Thread by @ethena_labs

Introducing @convergeonchain: The settlement network for traditional finance and digital dollars, powered by @ethena_labs and @Securitize

Our vision is to provide the first purpose built settlement layer where TradFi will merge with DeFi, centered on USDe & USDtb and secured by ENA

We see two core use cases for blockchains:

i) Settlement for permissionless spot and leveraged DeFi speculation

ii) Storage and settlement for stablecoins and tokenized assets

While the speculation use case has and will continue to play an important role in crypto, we see a less competitive and much larger opportunity to win the second category over the next decade

Ethena and Securitize are uniquely positioned to do so, together

We believe the biggest theme of this cycle and the coming years is the onboarding of institutional flows of capital

Even after significant growth, DeFi TVL today at $100 billion remains insignificant compared to global capital markets

There remains a lack of purpose-built infrastructure tailor made to onboard major pools of capital into crypto native products

Ethena and Securitize are uniquely positioned to capture this opportunity together

Securitize is the market leader in tokenized products, having issued ~$2 billion across a wide range of on-chain securities, including Blackrock BUIDL and funds from Apollo, Hamilton Lane, and KKR, with more than 500,000 user accounts

Importantly, Securitize will deploy on Converge as the issuance layer for its core future tokenized assets

This will expand beyond tokenized treasury products and funds to include all forms of securities across asset classes

This initiative deepens our existing relationship with Securitize, who is a partner for USDtb, our stablecoin backed by Blackrock BUIDL

Ethena will bring its core product set in USDe, USDtb, and iUSDe to to be issued natively

These crypto-native assets and primitives will be exported into TradFi in purpose built formats they can underwrite and interact with, bringing billions in new capital flows onchain

Ethena today is one of the most influential onchain protocols, with integrations across all major DeFi protocols and the majority of centralized trading venues

While we have seen significant success with existing use cases for USDe-enabled applications, there is still a wide design space of net new financial primitives we will look to support building on USDe within the chain

Dollars remain the structural plumbing through which onchain capital flows, both for settlement and payments but also all core DeFi primitives like trading, lending, derivatives and leverage

Every protocol today in DeFi that touches dollars can be rebuilt around Ethena and have structurally improved economics by default

Applications will be built on Converge specifically to enable TradFi to interact onchain with iUSDe, USDe, and Securitize-powered assets

5 protocols have already committed to support on Converge by building and distribute institutional-grade DeFi products on the network:

- Horizon by Aave Labs: Bridging TradFi & DeFi with purpose-built markets for Securitize tokenized assets, including Ethena's institutional iUSDe
- @Pendle_fi Institutional: Rate speculation infrastructure for scalable institutional opportunities like iUSDe
- @MorphoLabs: Modular money markets for Ethena and Securitize assets
- @maplefinance / @syrupfi: Verifiable on-chain institutional yield and credit products built on and for USDe and RWAs
- @etherealdex: High-performance derivatives and spot trading built for Ethena liquidity with USDe collateral

We're excited to work closely with all these major partners in building cutting-edge products to onboard institutional inflows

For the first time traditional finance and internet finance will co-exist within the same execution environment, together, onchain

Along with a permissioned application set, Converge will also facilitate permissionless onchain finance within the same blockspace

The ecosystem will have three distinct pillars operating in parallel:

i) Fully permissionless user access to a DeFi ecosystem and applications which have already found product market fit building on USDe, alongside Ethena incubated and accelerated projects such as @etherealdex

ii) Permissioned applications where TradFi can interact with KYC'd parties using Ethena assets iUSDe and USDtb on purpose built applications such as those aforementioned

iii) New permissioned financial applications built on Securitize tokenized assets and securities; for example, leverage on credit and fixed income assets, to trading single name equities via both spot and perpetual swaps

Converge will deliver a highly-performant EVM compatible network, with an equivalent developer experience to Ethereum mainnet

Ethena and Securitize will be releasing more details related to the technical stack and developer documentation in the coming weeks

A more formal developer testnet will follow shortly after that

Mainnet is scheduled to launch in Q2

We invite builders looking to build products to onboard the institutional flows to crypto, and export unique crypto primitives to traditional finance

Major infrastructure providers and developer tooling will be present from day one including @LayerZero_Core (powering Ethena asset cross-chain interop), @PythNetwork, @wormhole, and @redstone_defi who have all committed to support. @Anchorage, @CopperHQ, @FireblocksHQ, @KomainuCustody, and @ZodiaCustody will bring institutional-grade custodial services and key management to @convergeonchain

USDe, USDtb and sENA will sit at the core of chain

Converge will be built with a permissioned set of institutional validators who will need to stake ENA to secure the network

Both USDe and USDtb will be enable the network's native gas token, allowing for users to more easily transact with lower friction

It is time for convergence