Key Takeaways 

How did Ethena’s founder react to the USDe ‘depeg’?

Per the founder, the incident was isolated to Binance because it uses its own oracle.  

What’s the best way to prevent the depeg? 

Tracking external prices with rich liquidity. 

The market is still digesting the 10th of October crash that wiped out over $19 billion in leveraged positions. As one of the escalating factors, Ethena’s [ENA] synthetic stablecoin USDe depeg also hit headlines. 

During the de-leveraging event, USDe dropped sharply to as low as $0.65, about a 35% drop, and effectively depegged from $1 on the Binance exchange. 

In comparison, Bybit had only 5% drop while Kraken’s slipped by about 80 basis points (0.80%).

This underscored that the depegging appeared as an isolated issue within the Binance platform, according to Ethena founder Guy Young.

“I do not think it is accurate to describe this is a USDe depeg when a single venue was out of line with the deepest pools of liquidity that experienced no abnormal price deviations whatsoever.”