Ethena Labs announced today that it has partnered with Donald Trump's token project World Liberty Financial (WLFI). Together, they will list Ethena's sUSDe token as a collateral asset on WLFI's Aave v3 instance.
The partnership will benefit both parties. Ethena Labs will gain new use cases for its sUSDe token, while WLFI will have a collateral asset that has already passed the risk analysis of the Aave core.
Ethena Collaborates with WLFI Aave
According to the announcement, this partnership is tied to WLFI's new governance proposal. If the proposal is passed, Ethena Labs' staking version of the USDe stablecoin, sUSDe, will become a core collateral asset on the WLFI Aave instance.
"If the proposal is passed, WLFI users will be able to earn sUSDe rewards and WLF token rewards. This integration will increase the stablecoin liquidity and utilization of the protocol, just as the integration of sUSDe on the Aave core instance did," the company wrote on X (formerly Twitter).
WLFI has faced significant setbacks due to a failed pre-sale launch, but has received new investment capital following Donald Trump's electoral victory.
Last week, WLFI invested $1 million in the AAVE governance/utility token, boosting its value by around 30%. The protocol plans to launch its Aave instance in October.
Meanwhile, Ethena Labs launched a new stablecoin USDtb earlier this week. This new stablecoin is backed by BlackRock's tokenized fund BUIDL, and the high interest in it has generated another market rally for ENA.
However, this "strategic partnership" can bring healthy returns to both parties. WLFI mentioned in the governance proposal that sUSDe has already passed the risk analysis on the Aave core, and therefore is likely to pass similar reviews on the new instance.
Ethena will jointly incentivize the staking of sUSDe on the Aave instance if the WLFI proposal is passed.
WLFI will benefit from Ethena's total value locked (TVL) and user base by deploying sUSDe on the Aave instance. Ethena will gain new use cases for the sUSDe token, increasing stablecoin liquidity and overall utilization.
Through this simple partnership, Ethena has found a way to strengthen this revenue-generating token, allowing it to focus on developing and promoting other products.
