Ethena Labs Raises $14M for Synthetic Dollar; Xcad Founder Defends KSI; US Banks Request Favorable SEC Crypto Regulations
Summary:
Ethena Labs, a tech startup developing an Ethereum-based synthetic dollar, has raised $14 million in a new funding round. The founder of Xcad Network defended YouTuber KSI after accusations of pump-and-dump actions involving his project. In another development, a US coalition of banks and financial services groups appealed to the SEC to revise current rules, potentially allowing American banks to hold custodianship for spot Bitcoin exchange-traded funds.
Ethena Labs, a budding technology company pursuing the creation of a synthetic dollar on Ethereum, has recently garnered $14 million in fresh capital. Simultaneously, the head of the project criticized by YouTuber KSI for alleged pump and dump activities has defended him a day after the accusations. Moreover, a coalition of banks and financial services organizations in the US has called for an update to current SEC regulations that could enable US banks to act as custodians for spot Bitcoin exchange-traded funds.
Ethena Labs, a technology startup, has successfully raised $14 million to expedite their project of a synthetic dollar based on Ethereum. This recent funding, unveiled on Feb. 16, is an addition to a previous round that generated $6 million and was led by the likes of Binance Labs, Gemini, and Bybit, among others. This current fundraiser was chiefly supported by Dragonfly, a venture capital firm. Ethena Labs is currently working on USDe, a synthetic dollar underpinned by delta-hedging tactics that use Ether (ETH) as its main collateral. Having launched in December, USDe has managed to gather over $200 million in total value locked, as per industry figures.
The company further explained that USDe preserves its approximate target to the U.S. dollar by delta-hedging resources supplied by users minting USDe. This process uses short-staked Ethereum collateral with perpetual swaps to achieve 'delta-neutral' stability. Given the immense success of stablecoins in the blockchain industry, with a total market capital valued at $138 billion, Ethena's project aims to leverage this triumph.
Oliver Bell, the founder of Xcad Network, has stepped up to shield YouTuber KSI from the onslaught of pump-and-dump allegations. Following investigator ZachXBT's expose, which pointed out KSI's X account promoting then dumping $850,000 worth of XCAD tokens, Bell countered the claims. In a statement made on Feb. 15, Bell justified KSI's right to sell his tokens, highlighting that KSI purchased significantly more tokens than he sold.
Despite the growing controversy, major players in the US banking and financial sector are appealing to the SEC for an update to its crypto asset definitions. This change could potentially permit these entities to take on more significant roles in the crypto space, such as custodians to spot Bitcoin exchange-traded funds. The request was detailed in a letter to SEC Chair Gary Gensler on Feb. 14 by a collective of the Bank Policy Institute, American Bankers Association, Financial Services Forum, and Securities Industry and Financial Markets Association.
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Additional reporting by Geraint Price, Sam Bourgi, and Felix Ng.
Published At
2/16/2024 11:14:15 PM
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