Ethena Labs Confirms USDe Suffered Price Volatility

A history of Ethena USDe

Ethena’s USDe is a crypto-native, yield-bearing synthetic stablecoin launched in early 2024 that maintains its dollar peg through a delta-neutral strategy, backing long spot assets (like ETH) with short derivatives to hedge price volatility. Unlike traditional stablecoins backed by fiat reserves, USDe leverages on-chain collateral and derivatives funding rates to remain stable, while offering users yield via its staked variant, sUSDe.

Throughout 2025, USDe saw explosive growth, surpassing $9 billion in supply and becoming the third-largest stablecoin, aided by regulatory alignment efforts like its GENIUS Act-compliant USDtb partnership with Anchorage Digital. The protocol also expanded into Solana via JupUSD and endured a real-world stress test in October 2025 during a market-wide sell-off, briefly depegging but remaining overcollateralized.

Broader Market Context

The crypto market has faced steep corrections following renewed macroeconomic tensions, triggering billions in liquidations across leveraged positions. In this environment, concerns around stablecoin depegs and systemic risk have resurfaced. However, Ethena appears to have weathered the volatility while improving its collateral buffer.

The update offers reassurance to USDe holders and DeFi participants that the synthetic stablecoin’s mechanism remains intact, even under stress.