The synthetic stablecoin USDe of Ethena decreased by approximately 8.3 billion USD in market capitalization after the market crash on 10/10, nearly losing half of its previous level.

This development was recorded by 10x Research in the context of weakening confidence in the leveraged and synthetic collateral model, although USDe has recovered its price close to the pegged level of 1 USD.

MAIN CONTENT

  • USDe decreased from 14.7 billion USD to approximately 6.4 billion USD in market capitalization.

  • The crash on 10/10 liquidated over 19 billion USD, wiping out about 1.3 trillion USD in market capitalization.

  • USDe returned to 0.9987; trading volume decreased by ~50%, Bitcoin spot ETF in the US saw a net withdrawal of ~5 billion USD.

USDe lost market cap after the crash on 10/10

USDe has decreased by approximately 8.3 billion USD in market cap since the market crash on 10/10, from 14.7 billion USD (09/10) to about 6.4 billion USD currently.

According to 10x Research, the nearly fifty percent drop reflects a significant decrease in investor confidence in cryptocurrency models using leverage and synthetic collateral mechanisms. Capital volatility occurred after a major liquidation event and widespread market shock.

De-peg to 0.65 USD and weak liquidity signal

During the crash on 10/10, USDe temporarily deviated from the peg to about 0.65 USD, then recovered to 0.9987.

Guy Young, founder of Ethena Labs, stated that the temporary de-peg originated from an issue with the internal oracle of the exchange, not a protocol or collateral asset failure. The event on 10/10 was described as the largest in the history of the cryptocurrency market, with over $19 billion in positions liquidated and approximately $1.3 trillion in market cap wiped out, equivalent to nearly 30% of the total market cap at that time.

Although the price of USDe has nearly returned to the peg, market activity remains weak: trading volume has decreased by about 50%. Meanwhile, Bitcoin spot ETFs listed in the US recorded a net withdrawal of about 5 billion USD since the end of October; analysis suggests that the main reason stems from capital flow being more influenced by regulatory pullback than panic selling from retail investors.

Source: https://tintucbitcoin.com/von-hoa-usde-lao-doc-sau-sap-thang-10/

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