YZi Labs, the venture capital firm owned by former Binance CEO Changpeng Zhao, has significantly increased its investment in Ethena Labs, the protocol behind the synthetic stablecoin USDe. This undisclosed funding round reinforces YZi Labs' commitment to building digital dollar infrastructure, following its early backing of Ethena in 2024 before the protocol's public launch.
USDe has rapidly grown to over $13 billion in supply, making it the third-largest stablecoin, while Ethena's total value locked (TVL) reached $14.22 billion. The protocol's Q3 report highlighted $9.25 million in returns, its highest this year. Nicola Wang, Investment Director at YZi Labs, emphasized Ethena's crypto-native design and yield-generating model that avoids reliance on banks, citing long-term potential.
Ethena is expanding its ecosystem, including a recent launch on BNB Chain to foster new integrations and partnerships. Future plans involve scaling USDtb, a fiat-backed stablecoin aligned with the U.S. GENIUS Act, and developing Converge, a settlement layer with Securitize and BlackRock's tokenization partners to bring institutional real-world assets on-chain. Guy Young, Ethena Labs CEO, stated that USDe's integration across exchanges and DeFi protocols is realizing the vision of yield-bearing digital dollars.
Despite this momentum, Ethena's native token ENA dropped over 8.5% in 24 hours and 35% in two weeks after failing to break resistance at $0.85. It now trades at key support, with risks of further correction if levels break.
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