U.Today - Ethena, a crypto start-up, has achieved a significant milestone by securing an impressive $6 million in seed funding, according to a report from . The funding round, led by prominent investment firm Dragonfly, demonstrates growing interest in Ethena's cutting-edge stablecoin project.
Thus, in response to the challenges faced by previous stablecoin ventures, the start-up has developed a unique approach to ensuring its stablecoin, known as USDe, maintains a stable value relative to the U.S. dollar. By employing derivatives and a hedging mechanism, Ethena aims to ensure that the value of USDe remains pegged to the dollar.
The difference
EthereumThe start-up wants to distinguish itself from previous attempts at algorithmic stablecoins, such as the infamous . Moreover, Ethena's approach sets it apart from current stablecoin leaders USDC and USDT, which predominantly rely on traditional fiat-based assets like bills and bonds.
The success of Ethena's funding round is further amplified by the support it has garnered from prominent players in the cryptocurrency industry. Notable investors include big crypto exchanges and, additionally, . The founder of BitMEX and his family office have provided crucial backing to the project. This is especially noteworthy since Hayes himself has advocated for the development of an algorithmic stablecoin backed by derivatives, known as NakaDollar.