Stablecoin Protocol Ethena Closes $6 Million Seed Round Led by Dragonfly

Crypto startup Ethena raised $6 million in seed funding led by Dragonfly, with participation from Deribit, Bybit, OKX, Gemini, Huobi, and others.

Ethena is developing a new stablecoin, USDe, that maintains its dollar peg by using collateral from users to hedge price exposure by shorting Ethereum using perpetual swaps. By holding equal amounts of staked ETH and perpetual swaps, it ensures that any gains or losses by either asset are essentially canceled out.

It is also developing a digitally native, USD-denominated Internet savings bond that generates yield from a combination of staked ETH and swap margins.

Ethena hopes to fully launch its stablecoin and bond asset in the coming months after completing the testnet phase in the third quarter.