Revealing USDe: The Synthetic Dollar Stablecoin Taking Over DeFi

USDe’s supply surged over 75% in 30 days, becoming the third-largest dollar stablecoin through high yields and delta-neutral hedging strategies.

Strong DeFi integration, multi-chain expansion, and regulatory partnerships have helped USDe attract both retail and institutional investors across 24 blockchain ecosystems.

USDe’s model faces risks from market downturns, complex derivatives exposure, and regulatory uncertainty, despite enhanced transparency and strategic partnerships with major financial firms.

On August 4, 2025, the supply of USDe, the stablecoin issued by Ethena Labs, reached a major milestone. It broke through 9.3 billion coins, totaling around 9,310,382,206, a record high. Just one month earlier, the number was at 5.31 billion. That means USDe grew more than 75% in just 30 days, showing strong momentum in the decentralized finance (DeFi) space.

Now the third-largest dollar-pegged stablecoin after Tether (USDT) and Circle (USDC), USDe’s rapid rise reflects market recognition of its unique model. It also raises questions about its sustainability and risk. So, what exactly is USDe? Why has it grown so fast in DeFi? And where is it heading next?

CORE MECHANISM OF USDe: AN INNOVATIVE SYNTHETIC DOLLAR

USDe is a synthetic dollar stablecoin developed by Ethena Labs. It aims to maintain a 1:1 peg with the US dollar using blockchain-based tools. Unlike USDT and USDC, which are backed by dollars in bank accounts, USDe uses a delta-neutral strategy to keep its price stable. Ethena Labs uses crypto assets like Ethereum (ETH) or Bitcoin (BTC) as collateral and opens short positions on derivatives markets like perpetual futures.

This helps offset price changes in the collateral. For example, if ETH drops, gains from the short position can balance the loss, keeping USDe stable at $1.

This system avoids reliance on centralized reserves. At the same time, it generates returns for users through staking and interest rates from derivatives. Users can stake USDe into sUSDe and earn annual yields of 10%–19% on some platforms. This combination of high yield and decentralization makes USDe attractive in the DeFi world, drawing in many yield-seeking investors.

THE RAPID RISE: WHY USDe IS ATTRACTING THE MARKET

Since launching in February 2024, USDe has quickly grown from zero to over 9.3 billion in supply. Its success comes from strong yields, ecosystem support, and focus on compliance.

First, high returns are a big reason for USDe’s popularity. In July 2025, sUSDe offered over 10% annual returns on many DeFi platforms. That’s much higher than traditional finance and even competitive within DeFi. These returns come from how Ethena Labs uses funding rates in the derivatives market to generate risk-adjusted profits.

Second, USDe has expanded its ecosystem quickly. It now runs on 24 blockchains including Ethereum, Solana, and TON. It is deeply integrated with major DeFi protocols like Aave, Curve, and Uniswap. This gives USDe strong liquidity and wide use cases—from cross-chain transfers to lending and decentralized trading.

Ethena Labs has also launched a version called USDtb that complies with the U.S. GENIUS Act. It partners with Anchorage Digital and other regulated institutions, increasing USDe’s trustworthiness. This compliance helps attract institutional investors, bringing USDe into both crypto and traditional finance circles.

RISK FACTORS OF USDe

Even though USDe is performing well, its unique system comes with risks. First, the delta-neutral strategy works best in a bull market. In a downturn, it may face problems. Fantom Foundation CTO Andre Cronje warned that in a bear market, funding rates could fall sharply. This would reduce or even eliminate returns, similar to the collapse of Terra-Luna in 2022.

The Terra case showed that stablecoins relying on complex financial tools may be fragile during extreme market stress. Ethena Labs has improved transparency by making its collateral data public and partnering with institutions like BlackRock’s BUIDL fund. But systemic risk from market swings still exists.

Also, USDe’s hedging strategy depends on complex derivatives trading. This requires strong technical skills from the team and depends on market liquidity. If trading volume is low or if something goes wrong—like a hack or exchange failure—USDe’s price stability may be affected.

Finally, regulation is another challenge. While Ethena Labs leads in compliance now, global rules for stablecoins are still changing. Future laws could impact USDe’s operations. Investors must be cautious and consider their own risk tolerance when chasing high returns.

FUTURE OF USDe: POTENTIAL AND DIRECTION IN DeFi

Looking ahead, USDe is likely to stay an important player in DeFi. It has several growth paths.

Ethena Labs plans to expand USDe to more chains, including newer blockchains and Layer 2 networks. This will help it reach more users and use cases. By working with emerging chains, USDe can grow its global footprint.

The team may also add new financial tools or improve the hedging model to increase returns on sUSDe. This could strengthen its lead in the DeFi yield market.

More partnerships with traditional finance will also help USDe. Collaborations with BlackRock or Anchorage Digital could boost trust and attract institutional capital into DeFi. Ethena Labs also plans to introduce community governance through its ENA token. Token holders will help decide the future of the project, making it more decentralized.

However, competition remains tough. USDT and USDC still hold large market shares. USDe must keep innovating and balancing compliance with growth to expand its influence.

〈Revealing USDe: The Synthetic Dollar Stablecoin Taking Over DeFi〉這篇文章最早發佈於《CoinRank》。