Ethena Seeks New Yield in Perpetual Equity Contracts
Ethena, the protocol behind the synthetic dollar USDe, is seeking new sources of yield in perpetual equity contracts. The company plans to transfer its basis strategy from the crypto market to these contracts, where funding rates have been higher than Bitcoin's this year.
According to Ethena CEO Guy Young, the equity market has shown more stable demand for leveraged long positions, resulting in positive funding rates on 94% of days on Hyperliquid and 97% of days on Binance. In contrast, crypto funding rates have been lower, with a median rate of 3.9% for Bitcoin.
The expansion into perpetual equity contracts is expected to provide Ethena with a more stable cash flow, less dependent on crypto market sentiment. The global equity market is valued at around $166.5 trillion, compared to the total crypto market cap of about $2.2 trillion.