Written by: Xiaobing
Ethena announced on September 25 that it has begun incorporating tokenized US stocks into USDe's basis trading strategy, with Binance as the first execution venue, and allocation starting today.
Founder Guy Young said: "This is the most significant expansion of USDe's funding mechanism since its inception."
Ethena's previous basis trading could only operate in the crypto perpetual futures market, holding BTC/ETH spot and shorting the corresponding perpetual contracts to earn funding rates. The size ceiling of this market is the total market capitalization of the crypto market, approximately $2.5 trillion.
The size of the stock market is over $150 trillion.
Basis Trading from Crypto to Stocks: The Same Logic, a Different Underlying
First, let's clarify the mechanics of this strategy.
Ethena's USDe (current supply approximately $4.9 billion) is a synthetic dollar whose yield comes from "basis trading," simultaneously holding a long spot position and a short perpetual contract position, with the price fluctuations of the two hedging each other (delta neutral). What Ethena earns is the funding rate paid by longs to shorts in the perpetual futures market.
Crypto version: Hold BTC spot + short BTC perpetual contracts = earn crypto funding rates.
Stock version: Hold bStocks (Binance's tokenized US stocks) + short Binance stock perpetual contracts = earn stock funding rates.
The structure is completely identical; the only change is that the underlying asset has switched from cryptocurrencies to stocks.
Why Expand to Stocks Now?
In summary: crypto funding rates are shrinking.
When leverage demand in the crypto market is strong, funding rates can reach as high as 20% annualized or even higher, and Ethena's yield rises accordingly. But during sideways or downtrend phases, funding rates compress or even turn negative, and shorts反过来 have to pay longs.
The crypto funding rate environment in 2026 is clearly not as lucrative as in 2024. USDe needs new sources of yield to maintain its appeal to depositors.
Binance's stock perpetual contracts offer an alternative option. According to data provided by Ethena, the open interest of Binance stock perpetual contracts has exceeded $2.9 billion, with a monthly compound growth rate of 105% in 2026. Over the past six months, the annualized yield of stock basis has averaged approximately 3.56%.
More critically, there is the size ceiling. The total open interest of the crypto perpetual contract market is approximately $15 billion, while the global stock market exceeds $150 trillion. Even if only one ten-thousandth of the stock market's volume enters on-chain perpetual contracts, the capacity available for Ethena to run its basis strategy would far exceed the current crypto market.
Risks to Note
Moving the same strategy to stocks involves several key differences in risk structure compared to the crypto version.
Counterparty risk of bStocks. bStocks are issued by BTech Holdings Limited, providing economic exposure to the underlying US stocks, but holders have no voting rights and do not directly hold the stocks themselves. Unchained's report noted that Ethena's risk advisor has flagged an issue: bStocks legally constitute unsecured exposure to a Binance-affiliated party, and this risk has not been mitigated before signing a side letter.
Weekend and trading halt gaps. US stocks do not trade on weekends, but perpetual contracts may continue to quote. This means that between Friday's close and Monday's open, the hedge may have a gap, with the spot side locked at Friday's price while the perpetual contract side continues to fluctuate. If a major event occurs over the weekend (war, corporate scandal, macroeconomic shock), the spot price may gap at Monday's open, and the hedged position could instantly become imbalanced. The crypto market operates 24/7, so there is no such problem.
Funding rates may turn negative. Like crypto perpetual contracts, the funding rate of stock perpetual contracts depends on the long-short ratio. If there are too many shorts (for example, a large influx of basis traders), the rate will compress or even become shorts paying longs. In such a case, Ethena would lose money rather than profit. The 3.56% annualized average looks stable, but this is backtested data and does not guarantee the future.
Binance concentration. Currently, Ethena's stock basis strategy is executed only on Binance, a single venue. This means Binance is simultaneously the issuance affiliate of bStocks, the trading venue for perpetual contracts, and the bearer of counterparty risk. The entire chain depends on Binance, and this concentration is diversified across multiple exchanges in the crypto version, but cannot yet be achieved in the stock version.
The Bigger Picture
For USDe depositors, stock basis is a diversification of yield sources. When crypto funding rates are low, stock basis can provide alternative yield, reducing the volatility of USDe's yield and its dependence on crypto market cycles.
What Ethena is doing, viewed within this week's news matrix, points to a larger trend.
The SEC has just granted tokenized stocks a five-year "innovation exemption," Ondo launched a BlackRock strategy-driven on-chain portfolio token, and Galaxy put sUSDS onto a public company's balance sheet.
Now, Ethena has connected tokenized stocks to a $4.9 billion synthetic dollar protocol as a core new component of its yield mechanism.
Each one is doing the same thing: making the asset boundary between on-chain finance and traditional finance increasingly blurred.
When the yield of a synthetic dollar can come from the perpetual contract funding rates of Apple and Nvidia stocks, the dividing line between the terms "DeFi" and "TradFi" becomes increasingly meaningless.
