In the third quarter of 2023, the startup from Portugal also intends to introduce a bond token built on the stablecoin platform.
Portugal-based Dragonfly led a $6 million seed investment round for Ethena, a business creating an internet savings bond and an Ethereum-based stablecoin secured by derivatives. The stablecoin and bond asset will launch in the third quarter with the startup’s funds.
Several cryptocurrency derivatives exchanges, including Deribit, Bybit, OKX, Gemini, and Huobi, as well as BitMEX founder Arthur Hayes and his family office, Maelstrom, participated in the funding round as additional investors.
Ethena, which was established earlier this year, is developing two new products that will combine to create a digital currency and savings platform. On-chain custody and settlement will be available for the fully collateralized stablecoin. By employing user-provided collateral to hedge the price exposure by placing bets against Ethereum using perpetual swaps, the coin will keep its peg to the US dollar. In order to keep the stablecoin’s value constant at $1, the system seeks to balance any profits or losses experienced by either asset.
The second product is a savings bond that was created digitally and was based on a stablecoin. With no connections to a government or organized banking system, the bond token performs similar services to a US Treasury.
In the press release, Dragonfly general partner Tom Schmidt remarked, “Ethena is building the holy grail of stablecoins: a coin that is truly stable, decentralized, and capital-efficient.” “Over the past few years, stablecoins have grown massively in popularity by providing access to USD-denominated savings and remittances for people around the world, but they’ve always been handicapped by one of these three issues. Ethena’s design solves these problems and benefits a wide audience. We’re happy to help them realize their vision.”
