How secure is the new Ethereum stablecoin USDe?

Algorithmic stablecoin? More than 20 percent return? Where have you heard that before? That’s right: Terra (LUNA), Anchor Protocol and the catastrophically imploded dollar coin UST. Do Kwon’s failed project was actually considered solid proof that a stablecoin cannot be secured by a volatile cryptocurrency. Even MakerDAO, which originally only used ETH to back its DAI stablecoin, has long since used USDC for this purpose. The stablecoin that is backed by real dollar reserves held by the regulated provider Circle.

“Let’s do it again”, only better, is what the Ethena Labs team apparently thought. On February 19th, Ethena launched its synthetic US dollar, USDe, onto the mainnet for the general crypto investor community. The “Internet bond” is intended to provide investors with a return of more than 27 percent per year and at the same time be decentralized and censorship-resistant. Although there is likely to be a lot of attention at the moment thanks to Ethena’s remarkable price performance – in the past seven days ENA has gained over 90 percent (as of April 9, 2024): experience advises skepticism.