CZ's Family Office Increases Stake in Ethena Labs Amid USDe Growth
CZ's Family Office Expands Ethena Labs Investment
YZi Labs, the family office of Binance co-founder Changpeng 'CZ' Zhao and Yi He (formerly known as Binance Labs), has increased its investment in Ethena Labs. This move comes as Ethena's USDe, a synthetic dollar, solidifies its position as the third-largest USD-denominated crypto asset, boasting a circulating supply exceeding $13 billion.
Ethena's Growth Strategy
The investment coincides with Ethena's expansion, including its integration with BNB Chain. Ethena is developing products aimed at bridging the gap between crypto and traditional finance:
- USDtb: A fiat-backed stablecoin currently in development.
- Converge: An institutional settlement layer being built in collaboration with Securitize and partners linked to BlackRock.
USDe: The Synthetic Dollar
USDe operates as a 'synthetic dollar,' backed by Bitcoin (BTC), Ether (ETH), and Solana (SOL). These assets are paired with short perpetual futures positions on exchanges to maintain a stable $1 peg.
Notably, USDe reached the $10 billion supply milestone faster than any other dollar-pegged crypto asset after launching less than two years ago.
YZi Labs' Perspective
Dana Hou, investment partner at YZi Labs, stated, 'Since our investment team first met Guy [Young] in late 2023, Ethena has become the category definer for yield-bearing synthetic dollars.'
Implications for Users and Institutions
These developments offer users more options for digital dollar holdings and utilization across both centralized exchanges and decentralized finance (DeFi) protocols. Institutional products like Converge aim to foster broader adoption of on-chain financial infrastructure by creating a familiar settlement layer for tokenized assets.
For projects looking to enhance the security and reliability of their platforms, services like smart contract audits and KYC/AML solutions, such as those offered by Codeum, are crucial.