Ebisu

Ebisu is a stablecoin credit market that enables users to borrow ebUSD—a stablecoin backed by blue-chip, yield-bearing assets—at user-set interest rates. The protocol offers leverage vaults for automated 4x exposure to assets like WBTC and weETH, and provides yield opportunities for depositors through stability pools and DEX liquidity provision. Built on Liquity V2, it operates as a permissionless, self-regulating credit market connecting borrowers and earners.

Yield in Ebisu comes from three main sources: borrower interest payments, upfront fees, and profits from liquidating undercollateralized positions. This yield is shared between two groups: Stability Pool depositors and DEX liquidity providers.

Stability Pool depositors earn:

• 75% of all interest and upfront fees paid by borrowers (in ebUSD)
• Collateral from liquidated positions, bought at a 5% discount (a "liquidation bonus")

DEX liquidity providers (for example, those supplying tokens to an ebUSD-USDC trading pool) earn:

• Trading fees from swaps in that pool
• The remaining 25% of borrower interest and upfront fees

The protocol uses a market-driven rate system. Borrowers set their own interest rates, competing based on "redemption risk": loans with lower rates are the first to be repaid (redeemed) if ebUSD's market price falls below its target value. This creates a balance where borrowers are incentivized to offer competitive rates.

Yield potential increases as more people use ebUSD and the available pools are less crowded (lower utilization).

Leverage vaults (like the 4x exposure vaults for WBTC and weETH) automate leveraged positions using bots that rebalance to maintain the target leverage. These vaults do not directly create new yield; they simply pass through any yield from the underlying collateral assets.

Ebisu raised $600,000 in a funding round announced July 30, 2025. Backers include individuals and firms: DCF GOD, Sam Kazemian (Frax Finance), Delucidator, Jai Bhavnani (RoyCo), kinnif (Fisher8 Capital), Zellic, 0xMinion (GBV Capital), Alan Curtis (EigenLayer), Chunda McCain (Nucleus), CJ, Gabe Tramble (Shoal Research), Gajesh Naik (EigenLayer), Garrett MacDonald (Permanent Ventures), llama intern, MEV Collector, Robert Chen (OtterSec), Scott Moore (Public Works), Stephen Tong (Zellic), Xin Yan (EthSign).