Ethereum News Today: Ethena's USDe Soars 75% in July Surpassing USDS as Stablecoin Supply Grows to $9.69 Billion

Ethena’s USDe has experienced a dramatic 75% surge in supply during July 2025, solidifying its position as the third-largest stablecoin by total supply. The rapid expansion has pushed the stablecoin past SkyProtocol’s USDS, marking a pivotal milestone in its growth trajectory [1]. This vertical growth, following months of constrained supply, reflects a combination of favorable ETH price movements and the strengthening of Ethena’s underlying economic model.

Ethena’s stablecoin operates on an algorithmic framework, where the value of USDe is primarily supported by ETH price dynamics. As ETH prices surged above $3,800 in the past month, Ethena’s model became increasingly effective, enabling the platform to sustain and expand its stablecoin supply. The growth has added over 4 billion tokens to USDe’s total supply, bringing the market cap to $9.69 billion [1].

The expansion aligns with broader trends in the stablecoin market, where nearly all major stablecoins have seen increased supply in recent weeks. Collectively, stablecoin supply has grown by $1.96 billion over the last seven days. USDe now surpasses highly active alternatives such as Binance’s FDUSD in terms of market presence and usage [1]. The token is also integrated into key DeFi platforms, including Curve Finance, where it trades against USDC, FraxUSD, and mkUSD, further diversifying its utility and exposure.

Liquidity and trading volume have also seen significant improvements. USDe now accounts for over 30% of its trading activity on Bybit, with an additional 20% transacting through Uniswap V3 pairs. The token’s growing reputation has facilitated its inclusion in multiple DeFi ecosystems, positioning it as one of the few synthetic stablecoins to approach a $10 billion supply while maintaining relevance in both decentralized and centralized trading environments [1].

One of the key features driving demand for USDe is its staking mechanism. The staked version of USDe, sUSDe, has traded at a consistent premium, rising from $1.08 to $1.19 over the past year. This premium reflects the market’s confidence in the asset’s value and its ability to generate yield under favorable ETH conditions. However, unstaking remains subject to market conditions and potential delays due to high redemption demand [1].

The performance of Ethena’s native token, ENA, also reflects the project’s momentum. ENA traded near its three-month high at $0.60 in mid-July, reaching a peak of $0.68. The token has benefited from the broader "Ethena summer" narrative, which has reinforced market sentiment around algorithmic stablecoins during the 2025 bull run [1]. Notably, Ethena has demonstrated its ability to deflate its token supply during market corrections without triggering widespread instability, adding to its credibility in a volatile space.

USDe currently offers an average APY of 8.85%, a stark increase from 3.51% in early July. This growth is closely tied to the ETH price environment, with higher ETH values enhancing the platform’s ability to maintain stablecoin issuance and yield generation. However, the lack of traditional collateral means that Ethena remains exposed to ETH’s volatility, and any sharp decline could necessitate a contraction in supply [1].

Source: [1] Ethena's USDe expands by 75% as growth turns vertical in ... (https://www.mitrade.com/au/insights/news/live-news/article-3-1009127-20250804)