New Faces of Stablecoins MultiChain Order Book Elixir Launches Stablecoin deUSD to Compete with Ethena
The modular liquidity protocol Elixir recently launched the stablecoin deUSD, which will serve as the preferred collateral within the Elixir ecosystem. The official statement mentioned that most DEX platforms partnered with Elixir will utilize deUSD. The principle is similar to Ethena, where users deposit stETH and sDAI, while simultaneously shorting ETH on exchanges to earn funding rates. Currently, the Sei official stablecoin fastUSD is fully collateralized by deUSD, and Elixir will launch its mainnet on October 31st. Staking deUSD will allow users to earn double Elixir rewards, with Curve LP receiving a 10x bonus.
Valued at 800 million, liquidity protocol Elixir received investments from Arthur Hayes, Hack VC, and Mysten Labs.
Elixir founder Philip Forte is a partner at BlockVenture Coalition, and COO Cole Petersen has previously worked at the company. The team’s CTO Christopher Gilbert was a lead engineer at Tokensoft. Elixir received investments from Hack VC, Arthur Hayes’ family office, and Mysten Labs’ Sui team, reaching a valuation of 800 million after a recent funding round. The protocol is primarily a cross-chain modular liquidity protocol that collaborates with DEX platforms, with Elixir staking equivalent to betting against derivative traders on Dex.
If funding rates turn negative, deUSD’s profit source will be sDAI.
deUSD is minted by staking stETH and sDAI, with the protocol shorting an equivalent amount of ETH to earn funding rates. Even if the funding rates are negative, deUSD can still be profitable as it will participate in safer yield protocols like Sky Protocol. The core of deUSD is the Overcollateralization Fund (OCF), which, by monitoring the OCF’s operation, will switch to Sky Protocol’s sDAI in negative rate scenarios. sDAI provides revenue sharing for Sky Protocol fees and a mix of US Treasury bond yields, ensuring that deUSD holders can still earn profits and receive support in any market conditions, distinguishing it from similar protocols like Ethena.
When the OCF is about 20% remaining, deUSD’s collateral assets will be entirely sDAI. 30% of deUSD’s profits will fund the OCF, with this ratio expected to decrease as the OCF scales.
The goal is to achieve full decentralization, and deUSD has been adopted as Sei’s stablecoin asset reserve.
Currently, deUSD arbitrage is still centralized exchanges, but once DEX platforms have enough liquidity, Elixir will transition the entire mechanism to DEX. Elixir is currently being used in DeFi protocols like Vertex, RabbitX, BlueFin, and Orderly. Future collaborations will include dYdX, ApeX, Hyperliquid, Synthetix, SynFutures, and Aevo DEX platforms. Sei’s recently launched fastUSD is backed by deUSD as an asset reserve, and deUSD can be traded against other stablecoins on Uniswap, PancakeSwap, and Curve. On October 31st, Elixir will launch its mainnet, and over the next 10 months, Elixir will distribute 750 million Elixir tokens to users. Staking deUSD will earn double points, while Curve LP will receive a tenfold bonus. Users can currently participate in Elixir by staking deUSD.
