Ethena Labs and Securitize Launch Institutional-Focused Blockchain
By: Eliza Bennet
Ethena Labs and Securitize have recently announced the launch of Converge, a layer-1 blockchain tailored for institutional capital flows and the integration of tokenized assets with decentralized finance (DeFi). As highlighted in their recent announcement, this initiative seeks to create a purpose-built network catering to both permissioned and permissionless financial applications. The duo plans to release comprehensive technical documentation soon, paving the way for a developer testnet, with the mainnet launch anticipated in the second quarter of this year.
Converge is built on Ethereum Virtual Machine (EVM) compatibility, focusing primarily on facilitating DeFi speculation and offering storage and settlement solutions for stablecoins and tokenized assets. Although the potential for speculative activity is significant, there exists a larger opportunity in institutional adoption of tokenized financial products. Securitize has thus far issued approximately $2 billion in on-chain assets, including noteworthy financial instruments like the BUIDL fund from BlackRock and offerings from Apollo, Hamilton Lane, and KKR.
The introduction of Converge marks a significant step toward bridging traditional finance with innovative DeFi solutions. It operates with three application tiers: a permissionless DeFi ecosystem, permissioned applications for traditional financial institutions, and advanced financial products leveraging tokenized securities. This collaborative effort will see Ethena Labs introducing stablecoins and yield-bearing assets such as USDe, USDtb, and iUSDe. Additionally, Converge boasts partnerships with major infrastructure providers and institutional custodians aimed at asset management and key custody services.
The anticipated architecture of Converge is robust, featuring collaborations with Aave Labs, Pendle, Morpho Labs, and others committed to building institutional-grade DeFi solutions on the platform. Converge will integrate cross-chain operability via LayerZero, employ Pyth Network for price oracles, and utilize Wormhole for asset bridging. With backing from Anchorage, Copper, Fireblocks, and other leading custodians, Converge is set to redefine the landscape of institutional finance in the blockchain space.
