Ethena's USDe Plummets: 1011 Crash Triggers Historic $8.3B Exodus

2026-01-05 14:56:18

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Ethena’s synthetic stablecoin USDe has experienced a dramatic decline in recent months, with its market capitalization collapsing from approximately $14.7 billion on October 9 to around $6.3 billion today. This represents a staggering loss of nearly 50% in market value over just two months, according to latest market data.

The sharp deterioration coincided with the turbulent market conditions in early October, commonly referred to as the ‘1011 crash.’ The event triggered significant user redemptions, with on-chain data revealing user withdrawals totaling roughly $8.3 billion from the protocol during this period.

Market Implications of the Decline

The substantial outflow highlights the volatility surrounding synthetic stablecoins and raises questions about investor confidence in Ethena’s USDe mechanism during periods of market stress. The rapid depletion of liquidity demonstrates how quickly synthetic assets can face redemption pressure when market conditions deteriorate unexpectedly.

Current Status

Despite the sharp retracement from its October peak, USDe continues to maintain its position as a notable player in the synthetic stablecoin space. However, the steep losses since the 1011 crash serve as a cautionary reminder of the risks inherent in newer stablecoin models during volatile market environments.

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