Ethena’s USDe Becomes the World’s Third-Largest Stablecoin Amid Soaring Demand

USDe, the stablecoin issued by Ethena Labs, has become the third-largest stablecoin by market capitalization, following only USDT ($163.8B) and USDC ($64B), according to CoinGecko data. Since mid-July, USDe’s supply has surged by over 75%, reaching $9.5 billion.

This growth coincides with a broader trend: the total market capitalization of stablecoins has been rising for seven consecutive months, now nearing $275 billion.

At the same time, Ethena’s total value locked (TVL) has reached approximately $9.4 billion, positioning the platform among the top 7 DeFi projects globally.

The rapid increase in USDe issuance has also impacted ENA, Ethena’s native token. Over the past month, ENA has appreciated by 130.8%, currently trading at $0.58.

One of the key factors behind the surge in USDe’s popularity is its yield potential: holders can earn between 10% and 19% APY. Currently, the annual staking return is 10.86%. Adjusted for U.S. inflation (2.7%), this results in a real APY of around 8.16%, making USDe attractive compared to traditional financial products.

According to Brandon Kay from The Block Research, the recently adopted GENIUS Act in the U.S. has further boosted demand. Ethena’s partnership with Anchorage Digital has enabled it to issue USDe in line with the new regulatory requirements.

Anthony Yim, co-founder of Artemis, called yield-bearing stablecoins the “unexpected winners” in the wake of the GENIUS Act.

Julio Moreno, Head of Research at CryptoQuant, noted that investors are increasingly turning to interest-bearing stablecoins like USDe and USDS for staking opportunities within protocols. He forecasts the total stablecoin market could surpass $300 billion by the end of 2025 if the current pace continues.

However, some experts urge caution. Temujin Louie, CEO of Wanchain, argues that asset tokenization by traditional finance (TradFi) players could slow down the growth of decentralized stablecoins. According to him, tokenized money market funds may replicate the advantages of stablecoins—speed, flexibility—while maintaining regulatory oversight.

Meanwhile, parts of the crypto community have compared USDe to the failed algorithmic stablecoin UST by Terra. But Ethena insists that USDe is fully backed and hedged. The project has also added BTC and USDT to its reserves and appointed independent auditors.

Earlier this year, German authorities halted USDe sales over “serious deficiencies” and non-compliance with MiCA. In April, Ethena Labs officially exited the German market.

From: forklog.com.ua