Synthetic Stablecoin Leader Expands ScopeEthena, the protocol behind the $6 billion USDe stablecoin, has announced ambitious plans to redefine financial services by evolving into a neobank. Launched in early 2024, Ethena has rapidly gained prominence, capturing 85% of on-chain USD asset growth in its debut year, excluding USDT and USDC. With an annualized run-rate exceeding $1.2 billion, it is the second-fastest crypto startup to achieve $100 million in revenue, trailing only Solana-based Pump.fun.The protocol's latest move focuses on expanding its product suite to bridge traditional finance and blockchain technology. Ethena’s founder, known simply as “G,” outlined the roadmap in a blog post, revealing plans to launch a dollar savings product and a Telegram-integrated payment solution in 2025. These offerings aim to leverage Ethena's existing infrastructure while introducing fintech tools to a broader audience. Ethena also recently debuted USDtb, a fiat-backed stablecoin linked to U.S. Treasurys through BlackRock’s BUIDL fund, diversifying its product portfolio.At the core of Ethena’s expansion is iUSDe, a new institutional-grade token designed to bring crypto-native returns into the realm of regulated finance. This token replicates the rewards structure of sUSDe but includes a programmable “wrapper” to comply with traditional financial oversight. Financial institutions can gain exposure to iUSDe through special-purpose vehicles (SPVs) managed by regulated investment firms, bypassing the need to interact directly with crypto infrastructure. According to G, the product offers a compelling value proposition: superior risk-adjusted yields stemming from crypto arbitrage strategies.Ethena’s synthetic dollar, USDe, maintains its peg to the U.S. dollar through a carry trade that arbitrages ETH futures and spot prices, capitalizing on market convergence trends. This mechanism has made USDe a preferred collateral asset across 60% of centralized exchanges, driving its integration into offerings from algorithmic stablecoin issuers like Frax and Sky. Ethena’s approach has positioned it as a significant player in both DeFi and CeFi, capturing 7% of open futures interest in crypto markets.The push into regulated markets signals a new phase for Ethena. By pricing iUSDe as a spread to risk-free U.S. Treasury yields, G believes it will attract asset managers, ETFs, and private credit funds. Ethena’s model not only taps into the unique negative correlation between crypto-native rates and traditional finance but also scales to meet the demands of larger capital markets.Beyond institutional products, Ethena is doubling down on payments innovation. Its Telegram app, built on the TON blockchain, will feature direct mobile tap payments, integrating seamlessly with Apple Pay for Telegram’s billion-strong user base. This effort targets Tether’s dominance as a payment tool by making USDe a viable alternative for transactions.Further developments include the launch of Ethereal, a bespoke appchain for crypto spot and perpetuals trading, and Derive, a protocol offering on-chain options and structured products. Ethena also plans to expand USDtb integrations across centralized exchanges, incentivizing platforms to adopt the asset through shared economics.Reflecting on the protocol’s journey, G described 2024 as a foundational year that set the stage for unprecedented disruption in 2025. Ethena’s ambitions, which aim to challenge traditional financial systems, underscore its mission to scale blockchain technology into mainstream financial markets. With a clear regulatory path and innovative products in its arsenal, the protocol appears poised to reshape how money moves across the internet.This article has been refined and enhanced by ChatGPT.