Ethena to invest $46m reserve fund in tokenized assets

Decentralized finance protocol Ethena will allocate $46 million of its Reserve Fund in various tokenized real-world assets.

Ethena (ENA) announced the decision on Oct. 10, revealing the fund’s allocations, which include BlackRock’s tokenized fund BlackRock USD Institutional Digital Liquidity, Mountain Protocol’s yield-bearing stablecoin, the Superstate Short Duration U.S. Government Securities Fund, and Sky’s new stablecoin USDS.

According to Ethena, the four assets were selected based on their potential in the real-world assets market. Criteria for selection included product maturity, assets under management or total value locked, liquidity, redemption time, legal design, and risk-adjusted yield.

Ethena’s Reserve Fund RWA allocations

The choice of BlackRock’s fund, Superstate’s government debt fund, Mountain Protocol’s stablecoin, and Sky’s stablecoin came after careful consideration by Ethena’s risk committee. The five-member group with voting rights includes individuals from Gauntlet, Block Analitica, Steakhouse, Llama Risk, and Blockworks Advisory.

Ethena had announced plans for the real-world asset-backed reserve fund in July, with the proposal attracting 25 issuers from across the market. The committee selected these four from the pool of applicants.

In the details shared in a blog post, Ethena has outlined the following allocations: 40%, or approximately $18 million, into BlackRock’s fund; 29%, or roughly $13 million, into Sky’s stablecoin; 16.5%, or $8 million, into Mountain Protocol’s stablecoin; and 14.5%, or $7 million, into Superstate’s tokenized U.S. government debt fund.

Once the committee finalizes the allocations, they will be responsible for monitoring the assets and providing regular updates.