Quick Overview of Converge: Ethena and Securitize's Compliance-First Public Chain
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Quick Overview of Converge: Ethena and Securitize's Compliance-First Public Chain
Converge's goal is to become the gateway for trillions of dollars in traditional capital to enter the blockchain.
Navigating Web3 tides with focused insightsBy Alex Liu, Foresight News
On March 18, 2025, at the Tokenize Summit in New York, Ethena, the leading synthetic dollar protocol, and Securitize, an asset tokenization platform, announced the launch of Converge — a blockchain network designed specifically for institutional investors. Positioned as a "settlement layer between traditional finance and digital dollars," Converge aims to enable seamless migration of existing smart contracts and DApps through full compatibility with the Ethereum Virtual Machine (EVM), with an official launch planned for Q2 2025.
Securitize CEO Carlos Domingo and Ethena founder Guy Young announce Converge
Converge: A Compliance-First, High-Performance Institutional DeFi Platform
Converge is designed to offer traditional financial institutions an infrastructure platform that meets stringent compliance requirements without sacrificing technical performance.
Leveraging EVM compatibility, the network enables seamless integration of Ethereum-based smart contracts and decentralized applications, significantly reducing migration costs for developers and users. Drawing architectural inspiration from technologies like Rollups, Converge ensures both scalability and security. To meet diverse global regulatory standards, the platform implements strict compliance measures, including KYC/KYB verification, institutional-grade custody services (provided by Anchorage, Fireblocks, etc.), and a permissioned validator node system.
The Converge network will support two parallel operating modes—enabling unrestricted DeFi application development while simultaneously offering compliant products tailored for traditional financial institutions. For instance, tokenized securities issued by Securitize can not only serve as on-chain collateral within customized money markets but also provide institutional investors with trusted, regulation-compliant access points to the ecosystem.
Core Assets and Network Security
In Converge’s design, USDe, USDtb, and sENA will serve as core financial assets underpinning the entire chain. The network will be secured by a permissioned system of institutional validators who must stake Ethena’s governance token ENA to ensure network stability and security. Additionally, USDe and USDtb will function as native gas tokens, enabling lower-friction transactions and improving overall transaction efficiency and user experience on the platform.
Synergy in Action: The Ethena-Securitize Alliance
This collaboration highlights the complementary strengths between crypto-native protocols and regulated traditional finance entities. Ethena, with over $6 billion in TVL powered by its synthetic dollar USDe, holds a pivotal position in the DeFi ecosystem. Its delta-hedging mechanism for maintaining stablecoin value has drawn attention from major institutions such as BlackRock. Meanwhile, Securitize, a pioneer in SEC-regulated asset tokenization, has issued more than $2 billion in on-chain securities and serves industry giants including Blackrock and KKR.
Both parties are contributing their core resources and technological advantages to Converge. Ethena plans to migrate nearly its entire $6 billion ecosystem to the new chain and launch native assets including USDe, USDtb (backed by Blackrock’s BUIDL fund), and iUSDe—a version tailored for asset managers. Securitize will deploy its comprehensive tokenization issuance and management system on Converge, covering equities, bonds, real estate, and other asset classes, while exploring innovative use cases such as on-chain stock trading.
Diverse Ecosystem: Powering Institutional DeFi with Top-Tier Partners
Converge demonstrates strong appeal in ecosystem development. It has already attracted leading DeFi projects such as Pendle, Horizon by Aave Labs, and Morpho, which will collaborate on developing customized institutional-grade financial products. On the custody and asset security front, Anchorage, Copper, and others will provide comprehensive support. Cross-chain interoperability solutions including LayerZero and Wormhole, along with RedStone oracles, will ensure reliable cross-chain asset transfers and data accuracy.
Furthermore, Converge’s validator nodes are jointly operated by traditional financial institutions and centralized exchanges, all required to stake Ethena’s governance token ENA. While this model may spark debate around decentralization, the team believes that involving regulated entities will greatly enhance institutional trust and lay a solid foundation for large-scale capital inflows.
Challenges and Outlook: Pioneering the Trillion-Dollar Market
Converge has attracted significant market attention, yet faces several challenges ahead. First, differing regulatory regimes across jurisdictions require continuous adaptation of rules governing the issuance and trading of security tokens. Second, demonstrating the cost and efficiency advantages of on-chain finance during the ecosystem's cold-start phase will be critical to attracting broader institutional participation.
Global DeFi total value locked continues to rise, while the traditional capital markets exceed $100 trillion in size. Even a minimal shift of capital onto the blockchain would represent a massive incremental opportunity. As Ethena’s founder stated, the crypto industry must move beyond internal circulation of existing capital. Converge aims to become the gateway for trillions of dollars in traditional capital to enter the on-chain world.
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