YZi Boosts Ethena Stake as Stablecoin Navigates Regulatory Challenges

YZi Labs has significantly increased its investment in Ethena Labs, the developer of the synthetic dollar-pegged stablecoin USDe, as the asset’s total value locked (TVL) surpassed $14 billion. This strategic move aims to accelerate USDe’s adoption across centralized and decentralized finance platforms while advancing the development of USDtb, a fiat-backed stablecoin, and Converge, an institutional settlement layer. USDe, now the third-largest USD-denominated crypto asset, has seen rapid growth, scaling to $14 billion in supply since its public launch, driven by its delta-neutral hedging model that generates yield without reliance on traditional banking infrastructureYZi Labs Boosts Support for Ethena as USDe Surpasses $13B^[1].

The partnership between YZi Labs and Ethena Labs builds on YZi’s early 2024 investment through its Season 6 Incubation Program. Nicola Wang, Investment Director at YZi Labs, emphasized the appeal of Ethena’s crypto-native stablecoin design, which differentiates it from bank-backed alternatives. The renewed backing will expand USDe’s integration on the BNB Chain, where Ethena has launched new money markets and protocol partnerships. Binance, which recently added USDe as a spot trading pair and collateral asset, has become a key driver of adoptionFormer Binance Labs YZi Increases Ethena Stake as USDe Reaches $13B TVL^[2].

Ethena’s TVL growth reflects strong institutional and retail demand, with over $14.14 billion locked in the protocol as of September 2025. The project’s cumulative revenue has exceeded $500 million, supported by partnerships with firms like BlackRock, Securitize, and Franklin Templeton. USDtb, a GENIUS Act-compliant stablecoin, is set to be backed by BlackRock’s BUIDL fund, while Converge—a settlement layer co-developed with Securitize and BlackRock tokenization partners—aims to bridge traditional finance (TradFi) and DeFi by tokenizing real-world assets (RWAs)Binance-Linked YZi Labs Doubles Down on Ethena and USDe^[3]. Converge’s launch is expected to facilitate institutional-grade transactions, leveraging USDe and USDtb as gas tokens and integrating with protocols like Aave Labs’ Horizon and Morpho.

Regulatory challenges have tested Ethena’s resilience, particularly in Europe. In August 2025, Ethena exited Germany after a regulatory standoff with BaFin over the compliance status of its yield-bearing sUSDe variant. Despite these hurdles, the project’s offshore structure and adaptability have reinforced investor confidence, including YZi’s decision to deepen its stake. Ethena’s CEO, Guy Young, highlighted the project’s vision: embedding stable, yield-bearing assets into the crypto economy’s core. “With USDe scaling across exchanges and DeFi protocols, that vision is becoming a reality,” he statedYZi Labs Deepens Stake in Stablecoin Issuer Ethena^[4].

The broader market context underscores the growing demand for synthetic stablecoins. US Treasury projections estimate the stablecoin sector could reach $2 trillion by 2028, while the Trump-backed GENIUS Act aims to solidify dollar-pegged assets’ dominance. Ethena’s delta-neutral model, which maintains dollar stability while capturing crypto market yields, has attracted major investors such as Dragonfly and Fidelity. The project’s expansion on BNB Chain aligns with Binance’s strategic focus on DeFi infrastructure, further positioning USDe as a competitive alternative to USDT and USDCEthena & Securitize Unveil ^[5].

YZi Labs’ $10 billion asset portfolio now includes over 300 projects across 25 countries, with Ethena representing a pivotal play in digital finance’s evolution. The investment firm’s support for Converge and USDtb reflects a broader trend of institutional capital flowing into yield-bearing stablecoins and RWA tokenization. As Ethena’s TVL and revenue metrics continue to climb, the project’s ability to navigate regulatory landscapes and scale across ecosystems will be critical to its long-term success in reshaping the digital dollar landscapeYZi Labs Boosts Ethena Labs as USDe Surges Past $13 Billion TVL^[6].