MegaETH unveils own stablecoin 'USDm'…partners with Ethena

Ethereum Layer 2 (L2) project MegaETH said on the 9th that it has launched its own stablecoin 'USDm' in collaboration with Ethena, an Ethereum-based synthetic stablecoin protocol.

USDm was designed to support real-time transactions and application services, and was issued based on Ethena's stablecoin technology stack. MegaETH plans to apply USDm across wallets, applications, and on-chain services to expand network utility.

MegaETH emphasized that the launch is significant as the chain's first substantive economic model. Unlike existing Layer 2 projects that have relied on sequencer fee margins or token prices, USDm is structured to support operations through yields generated from reserve management. Instead of user fees, financial yield is used as the source of network operating funds.

USDm's reserves are mainly invested in BlackRock's tokenized U.S. treasury fund 'BUIDL', and the yields generated there are used for sequencer operating costs. This allows gas fees to be maintained at cost. The reserve composition is flexibly designed so it can be reallocated to other products depending on market conditions, and provides predictable yields based on institutional-level collateral. USDm implements this structure through Ethena's stablecoin issuance platform USDtb.

In particular, MegaETH said it reorganized the network incentive structure through this partnership and operates the sequencer at cost so that users and developers can use the network with low fees. A sequencer collects transactions occurring on an Ethereum scaling network, orders them, bundles them, and submits them to the Ethereum main blockchain.

A MegaETH representative said, "USDm lowers user fees and expands application scalability," adding, "If fees stabilize below 1 cent, various services that were difficult due to cost constraints until now will become possible." They added, "Through cooperation with Ethena, we will create a 'win-win' structure that benefits the entire ecosystem."