Ethena's USDe Loses $8.3 Billion Post-Crash
- USDe lost $8.3 billion post-October crash.
- Delta-neutral model led to confidence loss.
- Stablecoin’s market cap drops by 56%.
Ethena’s USDe stablecoin experienced an $8.3 billion market cap drop following the October 2025 crypto crash, decreasing from $14.8 billion to $6.4 billion by December 24, 2025.
The significant decline highlights investor concerns over Ethena’s delta-neutral model and stablecoins’ vulnerability, affecting broader market trends amid ongoing financial market adjustments.
Ethena’s USDe stablecoin experienced a significant market drop post-October crash. The capitalization slid from $14.8 billion to roughly $6.4 billion by December 2025. The decline was further highlighted in an article on Phemex News.
Investor confidence waned following the failure of its delta-neutral model, heavily leaned on BTC positions and centralized exchange liquidity, with on-chain analysis tools offering insights into the systemic vulnerabilities.
Commotion in the market led to a 31.4% contraction in USDe supply as attributed to the reduced investor trust.
Investors urged a swift exit from synthetic stablecoins, echoing a trend towards safer, fiat-backed options, impacting the broader market. As noted by crypto market experts, “The broader retreat from synthetic stablecoins to fiat-backed options like USDT/USDC indicates a shift in investor sentiment following the crash,” 99Bitcoins.
The October 10, 2025 crash notably destabilized various sectors, instigating a market-wide retreat. This incident was a key example of the “fragile interaction between Binance, Ethena, and Hyperliquid” being disrupted, as 10x Research Analyst stated:
“In this case, the fragile interaction between Binance, Ethena, and Hyperliquid was disrupted on October 10. This broke the momentum, and unlike previous pullbacks, the market could not recover,” 10x Research.
Long-term projections hint at intensified regulatory scrutiny and potential technological pivots, with expert analyses revealing systemic vulnerabilities. This could drive the market to explore various cryptocurrency markets available for identifying safer investment opportunities.
