"Ethena Labs' USDe Stablecoin Survives Record Redemption"

Ethena Labs, the developer of the USDe stablecoin, has reported a significant milestone in its redemption process. On February 22nd, the company processed its largest single-day redemption, successfully liquidating all unrealized risk exposure without any losses or redemption issues.

The event, which was announced by Ethena Labs founder @leptokurtic_ on social media, occurred at the peak of the unrealized risk exposure. Despite this, the exposure was always a small portion of the USDe excess reserve, and the company's USDe stablecoin never experienced under-collateralization. Even if the unrealized risk exposure did not drop to zero within hours, it could have been fully absorbed, ensuring that USDe remained overcollateralized.

This event serves as a validation of Ethena Labs' design decisions to mitigate user risk using the OES custody solution. The straightforward design approach avoids costs and engineering complexity that could be added by custodians in the off-chain hedging system. Ethena Labs did not experience any support loss or redemption request issues during this process.