Ethena Labs, two companies working closely with BlackRock’s Money Market Token Buidl, have created an Ethereum-compatible blockchain called Converge.
Ethena, which offers harvest-bearing USDE tokens and buidl-assisted USDTB stubrecoin, moves and converges the $6 billion defi ecosystem, but BlackRock’s buidl token transfer agents brings a suite like a real-world range of tokens like the recent apollo subsidies.
From the early days of Defi, there have been coordinated efforts to expand beyond cryptocurrencies and introduce traditional assets as collateral. Today, traditional financial companies are looking to take part in tokenization races, so it makes sense for companies like securitization and Ecena to create a path to defi, institution-friendly paths.
“Tokenization itself only places securities in a separate ledger, creating cost savings and efficiency, but it doesn’t necessarily lead to anything important when it comes to what you can do with these assets.” “On the other hand, Crypto has developed a very novel way of using digital assets. If we can actually bring that defi innovation back into the RWA space, it could explode.”
Securitize and Ethena brought their first partner robust companies to Converge, including Pendle, Avara (the parent company of Aave Labs), Ethereal, Morpho and Maple Finance. The custody services are provided by Copper, Fireblocks, Komainu, Zodia, and interoperability is provided through Layerzero, Wormhole, and Oracle Support from Redstone.
Ethena founder Guy Young said he’s looking forward to what he can build using Converge Blockchain and, courtesy of Securitize, is housed in the chain and opening new use cases.
“It could be that they’re using something like this as collateral within TaylorMade’s money market, or they could be trading a variety of assets that don’t exist in chains at a real scale. “We believe that what was built for this intersection of Tradfi and Defi will be one of the biggest opportunities in the coming years.”
Converge is compatible with Ethereum Virtual Machine (EVM) and allows you to run Ethereum-based smart contracts, DAPPs and tools without any changes. According to a press release, it boasts performance along the industry-leading blockchain.
Ethena’s native governance token, ENA acts as a steakable asset (via SENA) in Converge, protecting the network with a permitted set of validators consisting of traditional financial entities and central exchanges. Both USDE and USDTB act as gas tokens for your network.
Converge is a public open chain with a known (KYC) wrapper that seems to go beyond just a whitelist of wallets, Domingo said.
“Today Defi is specifically designed for free and anonymous market participants and freely tradeable assets,” Domingo said. “There’s a lot more than purely white wrist wallets and KYC to bring about that innovation in the context of the collateral and assets pledged to the protocol as a regulated instrument.”
