All the latest news and key insights you need from Ethena USDe
What Is ethena-usde?
1. What Is ethena-usde?
ethena-usde (commonly referred to as USDe) is a synthetic dollar stablecoin created by Ethena Labs on the Ethereum blockchain. Unlike traditional stablecoins that rely on fiat reserves, USDe is backed by crypto-native mechanisms—most notably delta-neutral hedging using long positions in liquid assets paired with short positions in perpetual futures. This creates a censorship-resistant, on-chain, composable stablecoin that offers both stability and yield within DeFi.
2. Why ethena-usde Was Created
ethena-usde was designed to solve the limitations of conventional stablecoins:
Avoid reliance on traditional banking and fiat systems that can be centralized or censored
Create a truly crypto-native form of stable money pegged to the U.S. dollar
Enable yield-bearing potential through DeFi-native strategies
By addressing centralization issues, USDe aims to provide an innovative and scalable stablecoin alternative.
3. How ethena-usde Works
Deposit Collateral: Users or Authorized Participants deposit collateral such as ETH, stETH, USDC, or other liquid staking tokens.
Mint USDe: The protocol mints USDe, maintaining stability through delta-neutral hedging that pairs long collateral positions with short perpetual futures.
Peg Maintenance: Arbitrageurs help stabilize the $1 peg by minting or redeeming USDe as price deviates.
Stake for Yield: Users can stake USDe to receive sUSDe, which accrues value from the protocol’s hedging profits.
Redeem Process: Users can redeem sUSDe back into USDe and swap into collateral or stablecoins, subject to redemption windows and limits.
4. Key Features of ethena-usde
Delta-neutral hedging reduces volatility and maintains stability
Yield generation through perpetual futures funding arbitrage and staking
Fully on-chain and composable with DeFi protocols
Censorship-resistant design independent of banks
Transparent minting and redeeming processes
Expanding collateral support including staked assets and top cryptos
Scalability with a target supply expansion up to $20 billion
5. Who Can Use ethena-usde?
DeFi users seeking a stablecoin with yield potential
Arbitrageurs and Authorized Participants maintaining the peg
Investors looking for passive yield via sUSDe
Institutions and CeFi platforms integrating stable assets
Developers building applications requiring stable, composable assets
6. What Is the $USDe Token?
$USDe is the native synthetic dollar stablecoin of Ethena. It is minted against crypto collateral and hedged through derivatives to maintain its peg. Its core utilities include:
Acting as a stable medium of exchange within DeFi
Supporting minting, redeeming, and liquidity provision
Enabling staking into sUSDe to earn yield from the protocol’s strategies
Serving as the foundation of Ethena’s goal to create scalable, censorship-resistant digital money