Ethena, a prominent decentralized finance (DeFi) protocol, has joined forces with Derive.xyz, a leading platform for on-chain derivatives, to enhance liquidity, foster growth, and provide additional rewards for users in both ecosystems. This new collaboration includes a multi-million dollar investment aimed at strengthening both platforms.
Partnership Overview
Ethena’s integration with Derive will allow the platform to leverage Derive’s diverse product offerings, including options, futures, and basis trading, to enhance liquidity and trading volume. Ethena’s USDe stablecoin and staked USDe (sUSDe) will be central to this integration, improving the execution of large trades at stable prices in Derive’s markets.
This move is expected to boost Derive’s market liquidity and improve the overall trading experience for users. Additionally, Ethena plans to introduce basis trading on Derive’s perpetual markets, pending approval from its Risk Council, further enhancing liquidity and order stability.
New Rewards and Benefits for Stakeholders
As part of the partnership, the Lyra Foundation, which governs the Derive protocol, will receive a multi-million dollar grant from the Ethena Foundation. Ethena will also reward holders of staked ENA tokens (sENA) with 5% of the DRV tokens granted to the Ethena Foundation. This move incentivizes continued participation from users, allowing them to benefit from the growth of both platforms.
Nick Forster, the founder of Derive.xyz, noted that combining Ethena’s liquidity with Derive’s advanced derivatives protocol opens up new opportunities for both retail and institutional traders. He highlighted that this partnership aims to set new standards in the DeFi space, offering cutting-edge products and innovative solutions.
Enhanced Collateral and Passive Yield Opportunities
Derive is also integrating Ethena’s USDe stablecoin as collateral, enabling users to trade while simultaneously earning passive yield. USDe, a synthetic dollar, uses a hedged strategy to maintain a $1 peg, making it a reliable collateral option for Derive users. Additionally, users can stake USDe (sUSDe) within Derive’s vaults, which combine Ethena’s staking rewards with Derive’s structured products for additional returns.
A Strong Future for Both Protocols
Ethena continues to grow in the DeFi space, with a total value locked (TVL) of over $4 billion and a user base exceeding 300,000. Its partnerships with major centralized exchanges like Deribit and ByBit further cement its position as a leader in the market.
Derive, with a TVL of $79 million, remains the largest decentralized protocol offering programmable on-chain options, perpetuals, and structured products. The launch of its DRV token in January 2024 is expected to bring even more liquidity and engagement to the platform.
The collaboration between Ethena and Derive promises to reshape the DeFi landscape, offering new liquidity channels, advanced financial products, and enhanced reward opportunities for users across both ecosystems.
