Ethena continues to deepen its ties with traditional finance, announcing a deal with asset manager Janus Henderson that includes a strategic investment in the protocol's governance token.

Under the agreement, Ethena will allocate and help distribute Janus Henderson's tokenized funds of collateralized loan obligations (CLO), the protocol said in a Tuesday X post.

Meanwhile, Janus Henderson, with $480 billion in assets under management, made a strategic investment in Ethena's ENA token and plans to use USDe, Ethena's yield-bearing synthetic dollar, as part of its treasury cash management strategy, according to a Thursday announcement.

The firms are also exploring ways to offer USDe to Janus Henderson clients through exchange-traded investment products.

ENA jumped 5% following the announcement before paring gains. It was down 8% over the past 24 hours as braoder crypto markets slipd

"We are really excited about the possibility here," Nick Cherney, head of innovation at Janus Henderson Investors, told Coindesk in a message. "We believe very deeply that innovation in blockchain is being led by the defi community, and that we need to continue to forge partnerships with leading founders and protocols."

The deal fits into the trend of traditional finance firms increasingly embracing and backing decentralized finance (DeFi) infrastructure. Earlier this year, BlackRock (BLK) expanded its tokenized money market fund through a partnership with Uniswap and also invested an undisclosed amount in the decentralized exchange's UNI token, while Apollo Global Management (APO) stroke a deal with lending protocol Morpho to bring tokenized private credit assets onchain and investing in the protocol's governance token.

Last week, Coinbase Ventures disclosed its first investment in Ethena and announced a partnership that will bring Ethena products to Coinbase's more than 100 million users. Separately, Ethena expanded its relationship with crypto bank Anchorage Digital to support institutional lending activity through Anchorage's Atlas collateral management platform.

Ethena has grown into one of the largest decentralized finance protocols by offering yield through its USDe token, which combines stablecoin demand with derivatives-based hedging strategies. After reaching roughly $15 billion in assets during last year's market rally, the protocol currently manages about $5 billion as crypto markets continue to recover from a prolonged downturn.

"Ethena has proven that even now it is possible to innovate in the stablecoin arena, and we continue to see huge opportunity in their business," Janus Henderson's Cherney added.