Institutional Lending Framework

General
1

Institutional Lending Framework

A counterparty that meets the criteria below can be onboarded by the trading team without an individual Committee vote. Ethena sends the counterparty’s documents privately to the Committee at least three business days before first funding, and a Committee member can only call a counterparty in by naming a specific criterion it fails, with the Committee deciding within five business days. Anything outside the framework comes to the Committee as before.

Approved lending partner criteria

  1. One signing entity, borrowing bilaterally with full recourse, or a parent guarantee if relying on a parent
  2. Licensed or registered in a jurisdiction not on the FATF black or grey list
  3. No sanctions on the entity, its controlling affiliates, or owners above 25%
  4. No pending insolvency or license revocation, and no fraud or client asset findings in five years
  5. Collateral held in a segregated tri-party account at an approved custodian
  6. Daily collateral reporting that Ethena can verify

Accepted collateral

The approved collateral is BTC, cbBTC, WBTC, ETH, stETH, wstETH, SOL, XRP, USDC, USDT, and XAUT (Ethereum only, once the custodian, the venues the collateral manager can sell on, and a weekend liquidation test are confirmed). LTVs are set by the lending team on its rate cards, which Ethena shares with the Risk Committee each month.

USDe, sUSDe, ENA, USDtb, and the borrower’s own assets are never accepted. Any other asset comes to the Committee.

Ongoing

Ethena sends a monthly book report to the Committee. A missed margin call, a default, or a change in a counterparty’s standing stops new lending to it and goes to the Committee within 48 hours. The five counterparties already approved keep their approvals.