The stablecoin USDe has jumped 75% in under three weeks, allowing it to overtake rivals and secure the third position in the global market.
Sharp Rise of USDe
According to recent data, the stablecoin USDe has shown impressive growth, reaching a capitalization of $9.3 billion. This achievement allows it to surpass stablecoins such as USDS and secure the third position after USDT and USDC.
Operational Mechanism of USDe
The secret behind USDe's rapid rise lies in its design. USDe maintains its peg to the US dollar by holding spot crypto positions like BTC, ETH, or SOL while taking short positions in futures markets. This 'delta-neutral' setup generates yield for stakers when funding rates favor short sellers, a condition that dominated much of July.
Future of USDe and Market Impact
However, USDe's model is dependent on market conditions, and a shift in funding or liquidity could threaten its sustainability. Additionally, the rise of USDe creates new demand for USDT, inadvertently enhancing the market leader it is competing against. Analysts suggest that if USDe's growth rate holds steady, it could challenge USDC's position within two years, but it is crucial to remember that algorithmic and synthetic stablecoins can falter as quickly as they rise.
Currently, USDe stands as the fastest-growing stablecoin of 2025, but its long-term survival will hinge on its ability to deliver consistent yields without breaking its peg.
