It’s business as usual for Ethena’s USDe as the synthetic stablecoin appeared to weather the storm brought on by market volatility from the White House’s trade war threats.
USDe differs from stablecoins such Circle’s USDC because it’s a synthetic stablecoin and not backed by fiat assets at a 1:1 ratio. The stablecoin maintains its $1 peg by collateralizing stablecoins and leveraging a hedged cash-and-carry trade, which involves taking futures positions with large open interest available to stabilize value.
USDe spent most of the Monday trading day maintaining its $1 peg, with brief dips down to $0.999. Data from CoinGecko shows that the stablecoin’s market cap inched above $6 billion, up from about $5.7 billion a week ago.
Its funding rate also remained positive according to on-chain data. Funding rates are crucial for maintaining USDe’s peg to the dollar and managing market equilibrium.
A positive funding rate indicates that holders of…
