Prominent crypto market maker DWF Labs has completed development of its synthetic stablecoin, which will be backed by a mix of digital assets, including Bitcoin and Ethereum. In a September 5 post on the social network X, DWF Labs co-founder Andrei GRACHEV said that the synthetic stablecoin will be overcollateralized and backed by fiat stablecoins such as USDT Tether, USDC Circle, and unnamed select altcoins.

He added that each asset will offer different APYs to incentivize community adoption. Grachev predicts that the asset will generate huge liquidity in the market. This announcement comes a month after DWF Labs revealed plans to enter the growing stablecoin market. Grachev mentioned that the digital asset will allow users to earn attractive yields without sacrificing flexibility. While the details of how DWF Labs’ stablecoin will maintain parity with the US dollar remain unclear, its launch could bolster the fast-growing stablecoin sector.

As DWF Labs prepares its synthetic stablecoin, Ethena’s USDe, a “synthetic dollar,” is facing a significant supply cut. USDe was one of the fastest-growing stablecoins earlier this year, attracting investors with its innovative mechanisms and high-yield potential. However, its growth has slowed over the past two months, with its market cap falling nearly $1 billion to $2.69 billion from $3.61 billion on July 4, according to CryptoSlate.

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