Binance Labs recently announced an investment in a startup focused on building products around stablecoins, called Perena. So what is Perena? How does the Perena project operate?
What is Perena?
Perena is an AMM (Automated Market Maker) decentralized exchange focused on stablecoin assets. Built on the Solana network, Perena aims to address the liquidity fragmentation of stablecoins while optimizing capital efficiency for stablecoin traders.
Besides AMM, Perena will continue to launch more products revolving around the stablecoin sector. Also, Perena has not yet launched a token; this article will be updated as soon as there is new information.
How Perena Works
According to the Perena team, stablecoins are one of the largest sectors in the crypto market, with over $170 billion in market capitalization, and have become a major part of payments and bridging between assets. However, this remarkable growth has led many projects to develop their own stablecoins. This results in fragmented stablecoin liquidity, low capital efficiency, and an unfriendly trading experience.
Therefore, Numéraire – an AMM exchange specifically for stablecoins – was developed to address these issues.
Numéraire’s model is designed based on a Hub-and-Spoke structure, consisting of a main liquidity pool and multiple surrounding sub-pools. The main liquidity pools are called Seed Pools, which include highly liquid stablecoins like USDC, USDT, etc. When providing liquidity to a Seed Pool, users receive USD* tokens.
Growth Pools are the sub-pools, consisting of USD* tokens and Perena’s partner stablecoins. Whenever a trade occurs, the swap process begins with a stablecoin being exchanged for USD*, then swapped back to the desired stablecoin.
With this operating model, liquidity providers in the Seed Pool accumulate more trading fees from the surrounding Growth Pools. Simultaneously, this mechanism helps new stablecoins minimize de-pegging risks by being linked to stablecoins with deep liquidity from the Seed Pool. For users, they can swap to different stablecoins with relatively low slippage.
However, this model has the drawback of being dependent on the Seed Pool. If the stablecoins in the Seed Pool de-peg, the token pairs in the Growth Pool will be affected. Although the Seed Pool includes stablecoins with abundant liquidity, large-cap stablecoins like USDT and USDC have also experienced de-pegging events. Finally, the swap fee between two partner stablecoins will be higher than usual due to the structure of the pools being paired only with USD*.
In addition, Numéraire’s liquidity provision model has two features:
- Bounded Liquidity: This feature limits the price range for liquidity provision to $0.99 – $1.01. This helps LPs optimize profits and limits slippage for users when trading, similar to the concentrated liquidity model (CLMM).
- Weighted Asset Exposure: This feature automatically balances the asset weight ratio of the pools. For Seed Pools, the ratio is 40% USDC, 40% USDT, and 20% PYUSD. For Growth Pools, the ratio is 50-50 between USD* and the partner stablecoin.
Team, Investors, and Partners of Perena Project
Project Team
The Co-Founder of Perena is Anna Yuan. After graduating from Harvard University, she worked at the Solana Foundation, Stablecoin Standard, McKinsey & Company, and more.
Investors and Partners
On December 11, 2024, Perena successfully raised $3 million in a Pre-seed round led by Borderless Capital. This funding round also saw participation from Binance Labs, SevenX Ventures, ABCDE, Primitive Ventures, Maelstrom, and others.
Perena’s strategic partners are all major projects like Cube Exchange, Marginfi, Mountain Protocol, and more.
Similar Projects
- Curve Finance: A decentralized exchange operating on the AMM mechanism within the Ethereum ecosystem, specifically designed for stablecoins.
- Haiko: An AMM project utilizing various operating models within the Starknet ecosystem.
