Feb 23, 2024 02:07 PM
(This post was last modified: Feb 27, 2024 12:41 PM by SUI-3183372.)
Ethena has introduced the USDe stablecoin, as well as sUSDe, a yield-bearing version, after raising $14 million from top crypto funds and exchanges. USDe aims to achieve stability through backings of Ether and Ether derivatives, offering "a more decentralized" alternative to the likes of USDC and USDT. Staked USDe, called sUSDe, currently offers a 24% annual yield, drawing interest for its competitive returns.
Unlike other Ether-backed stablecoins which require over-collateralization, users can mint USDe with about $1 in Ether. Ethena claims to have effectively solved the over-collateralization requirement with a "novel design": It opens short derivatives positions on centralized exchanges to offset the long spot positions represented by users’ deposited assets.
The Web3 community argues that this approach is too risky and that USDe will destabilize, drawing parallels to the Terra UST implosion. Ethena Labs have responded by rebranding USDe as a "synthetic dollar" rather than a "stablecoin" (lol) and emphasize its difference from traditional fiat-backed stablecoins, highlighting its unique backing and yield mechanisms:
"Ethena’s USDe is not the same as a fiat stablecoin like USDC or USDT. USDe is a synthetic dollar, collateralized with crypto assets and corresponding short futures positions. This means that the risks involved are inherently different"
USDe currently sits at $420.5m TVL and sUSDe currently offers 24.04% APY.
Always interesting to see how these play out, hopefully this one doesn't thrust us into 2 years of negative price action like UST did.
Full disclosure I hold absolutely zero of everything mentioned in this topic, I'm just a curious onlooker waiting for the show to start.
Unlike other Ether-backed stablecoins which require over-collateralization, users can mint USDe with about $1 in Ether. Ethena claims to have effectively solved the over-collateralization requirement with a "novel design": It opens short derivatives positions on centralized exchanges to offset the long spot positions represented by users’ deposited assets.
The Web3 community argues that this approach is too risky and that USDe will destabilize, drawing parallels to the Terra UST implosion. Ethena Labs have responded by rebranding USDe as a "synthetic dollar" rather than a "stablecoin" (lol) and emphasize its difference from traditional fiat-backed stablecoins, highlighting its unique backing and yield mechanisms:
"Ethena’s USDe is not the same as a fiat stablecoin like USDC or USDT. USDe is a synthetic dollar, collateralized with crypto assets and corresponding short futures positions. This means that the risks involved are inherently different"
USDe currently sits at $420.5m TVL and sUSDe currently offers 24.04% APY.
Always interesting to see how these play out, hopefully this one doesn't thrust us into 2 years of negative price action like UST did.
Full disclosure I hold absolutely zero of everything mentioned in this topic, I'm just a curious onlooker waiting for the show to start.







