Ethena Expands USDe Backing Strategy into Equity Perpetual Futures

Ethena is expanding its backing asset management strategy to include equity perpetual futures as it seeks to diversify revenue sources. This move comes amid declining funding rates across crypto markets and eroding profitability of traditional basis trades.

The company's founder, Guy Young, explained that equity- and commodity-linked perpetuals have become a significant growth market for the protocol. He noted that equities tend to rise over the long term, leading to sustained demand for leveraged long positions, and funding is less likely to compress even in bear markets.

Open interest in equity perpetuals has grown rapidly, reaching approximately $6.2 billion by August 11, with around 200 contracts traded. This represents only 6.6% of the approximately $94 billion in crypto perpetuals. However, funding rates for equity perpetuals are significantly higher than those for Bitcoin, at around 13.9% median and 3.4 to 4.3 times higher than Bitcoin's year-to-date average.

Ethena is also expanding its composition of backing assets, with real-world asset perpetuals expected to surpass crypto derivatives within the next 12 to 24 months. The company has secured a $1 billion FalconX facility that can direct USDe backing toward overcollateralized institutional lending.