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      Ethena's USDe Token Experiences Price Drop on Binance Amid Market Sell-Off

      Ethena's synthetic dollar token, USDe, faced a significant price drop on the Binance exchange, falling to as low as $0.65 before recovering towards its intended $1 peg. This incident occurred during a broader market sell-off on October 10-11, 2025, which saw the token's price on Binance diverge sharply from its performance on decentralized finance (DeFi) platforms like Curve and Uniswap, where it remained stable with deviations under 0.3%.

      The price dislocation on Binance appears to have been caused by a combination of factors, including a thin internal order book that distorted oracle pricing and operational issues with deposits and withdrawals that hindered arbitrage opportunities. Traders and Ethena Labs indicated that these issues were specific to Binance, as the protocol's mint and redeem functions continued to operate normally, processing over $2 billion in redemptions within a 24-hour period.

      At the time of the incident, USDe's total supply exceeded $12 billion, having previously peaked at around $14 billion due to prior reward programs on Binance. In response to the price volatility, Ethena published an emergency Proof of Reserves report, confirming that the protocol was overcollateralized by approximately $66 million. This situation highlights the importance of the trading venue, as the price on Binance did not reflect USDe's actual redeemable value, impacting holders on that platform who faced real losses despite the underlying protocol's stability.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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