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This Week In DeFi – April 5

This Week In DeFi – April 5

Alex Miguel
April 05, 2024

Happy Friday, DeFi readers!

This week…

Wormhole airdrops $W token
Ethena introduces BTC backing for USDe
Pendle reaches top 10 DeFi TVL
Ripple plans to launch its own stablecoin

Wormhole airdrops $W token

Wormhole has launched its $W governance token this week, opening claims for 617 million tokens.

$W debuted at a price of $1.66 per token and a market valuation of $3 billion, but has seen a quick tumble as the wider market faces tough conditions.

The launch led to congestion on the Solana network, as well as a swarm of phishing scam attempts across social media.

Wormhole also assisted the Fantom blockchain in launching its canonical stablecoin, USDC.e, an official bridged version of Circle’s USDC token.

1/🪱🕳️ Discover @wormhole: An open source interoperability and messaging platform for multichain app developers that connects over 30+ blockchains and helps bring an open economy to Solana.
— Solana (@solana)
Apr 4, 2024

Ethena introduces BTC backing for USDe

Ethena Labs, creator of the controversial USDe synthetic dollar (not to be confused with USDC.e above), has introduced Bitcoin as backing for USDe – expecting to double the stablecoin’s scalability.

The project has reached $2 billion in TVL, combined with $2 billion of USDe in circulation.

USDe was previously backed only by Lido Staked Ether (stETH), marking the expansion to BTC as a significant move.

Excited to announce that Ethena has onboarded BTC as a backing asset to USDe
This is a crucial unlock which will enable USDe to scale significantly from the current $2bn supply
— Ethena Labs (@ethena_labs)
Apr 4, 2024

Pendle reaches top 10 DeFi TVL

Yield platform Pendle has hit a new milestone of $10 billion in trading volume to date, with $4 billion in total value locked – putting it in the top 10 DeFi platforms by TVL.

The protocol’s growth has been attributed to the Ether staking boom, with significant trading in liquid staking tokens and synthetic dollar protocols like Ethena.

Pendle is also known for its leveraged points trading, enabling users to hedge or leverage their loyalty points up to 28x.

Pendle have now gone from $127M to $4B TVL since this tweet.
They are now the 9th biggest DeFi protocol by TVL 🤯
And $PENDLE is up about 600%.
— Aylo (@alpha_pls)
Apr 4, 2024

Ripple plans to launch its own stablecoin

Ripple has unveiled plans to launch a US dollar-pegged stablecoin aimed at enterprise clients and payment companies.

The stablecoin, backed by USD deposits, short-term U.S. government treasuries, and cash equivalents, will be audited by a third-party accounting firm, with Ripple publishing monthly attestations.

Initially available on the XRP Ledger and Ethereum, Ripple's move comes as a strategic effort to offer a reliable alternative as uncertainties still surround Tether (USDT).

1/ The stablecoin market is booming – around $150B today, and projected to soar past $2.8T by 2028. There's a clear demand for trust, stability, and utility.
That's why later this year we’re launching a stablecoin pegged 1:1 to the USD on the XRP Ledger and Ethereum.… twitter.com/i/web/status/1…
— Ripple (@Ripple)
Apr 4, 2024

Stablecoin update – newsworthy stables this month

With the huge variety of stablecoins on the market, along with several new additions, it’s probably a good time to do a recap on the latest updates for the less-understood contenders:

Ripple’s stablecoin (ticker unknown): Ripple is launching a new stablecoin, emphasizing a compliance-first approach. Ripple aims to boost liquidity on its decentralized exchange with the stablecoin, which will be issued on both Ethereum and the XRP Ledger.

The token will be backed 1:1 by a reserve of cash and cash equivalents.

Ethena’s USDe: Ethena’s USDe has been at the center of a lot of controversy, as community members weigh up the viability of its backing system. Its reliance on derivatives markets for stability opens it up to many additional risks – which may grow as its market cap does.

PayPal’s PYUSD: PayPal’s PYUSD stablecoin has stayed relatively low-key in the DeFi world, perhaps due to its overly-centralized nature that goes against the ethos of crypto.

However, the company will now be allowing US clients to send cross-border transactions using the stablecoin (indirectly) as it appears to be trying to boost PYUSD adoption.

First Digital’s FDUSD: FDUSD has slowly crept up the ranks as Binance’s sudden go-to stablecoin, following the disappearance of BUSD. The token has reached a market cap of almost $3 billion, being issued by a subsidiary of Hong Kong-based First Digital Limited.

The token is issued on BNB Chain and Ethereum, with regular attestations of reserves.

Tether’s USDT: The big daddy of stablecoins, Tether’s USDT has surpassed a $100 billion market cap this year. It continues to stoke doubts across the community on its trustworthiness – but still reigns as the largest stablecoin on the market.

Tether has been stacking a lot of Bitcoin in its reserves lately, now holding around $5.2 billion worth of BTC.