Synthetic tokens see a comeback as stablecoins market cap climbs

Synthetic stablecoins are regaining prominence, fueled by innovative financial engineering to mitigate volatility. SUI Group is set to introduce suiUSDe and USDi, marking the first native stablecoins within the Sui ecosystem. Developed in collaboration with Ethena Labs and the Sui Foundation, USDi will be fully backed by tokenized shares of a regulated money market fund, whereas suiUSDe employs a delta-neutral hedging strategy, combining crypto collateral with short futures to stabilize its value. Ethena’s USDe has already emerged as a leading synthetic dollar, now ranking third among global stablecoins with a market cap surpassing $14 billion. This launch follows the overall stablecoin market’s growth, which has crossed $300 billion as regulatory frameworks in the U.S. pave the way for clarity and institutional acceptance. Although synthetic options are increasing, traditional fully collateralized stablecoins like Tether’s USDt and Circle’s USDC continue to dominate the market share. Sui's entry into the competitive stablecoin space underscores its rapid ascent as a prominent blockchain project, currently valued at over $13 billion in market capitalization.

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