Ethena’s synthetic-dollar stablecoin USDe saw one of its sharpest monthly contractions yet, while fiat-backed stablecoins like USDT, USDC and PYUSD attracted billions in inflows.
CoinGecko data showed that Ethena’s USDe stablecoin fell from a market capitalization of $9.3 billion on Nov. 1 to a valuation of $7.1 billion on Nov. 30. The token saw roughly $2.2 billion in redemptions, marking a 24% decline in supply in November.
Ethena’s USDe is a synthetic stablecoin that maintains its dollar peg through trading strategies with crypto and futures contracts rather than holding actual dollars. This means that USDe outflows mean that users are either selling USDe on the open market, withdrawing from pools or unwinding their positions on decentralized applications (DApps).
At the time of writing, CoinGecko data shows that the overall stablecoin market cap is at $311 billion. The market remains dominated by US dollar stablecoins, capturing $303 billion of the sector’s total valuation.
USDe outflows follow October depeg
USDe’s November contraction comes weeks after the synthetic stablecoin suffered a depegging event on the crypto exchange Binance. At the time, USDe briefly plunged to $0.65 on the exchange.
Ethena founder Guy Young said that the drop was caused by a Binance-specific oracle issue and not a problem with USDe’s underlying collateral mechanism that backs the asset.
Young said that the USDe token’s minting and redemption functions operated “perfectly” during the incident, with approximately 2 billion tokens redeemed across decentralized finance (DeFi) platforms.
On Oct. 9, USDe market cap hovered at $14.8 billion, making it the third-largest stablecoin at the time. Since then, the stablecoin lost over 53% of its market capitalization.
At the time of writing, CoinGecko data shows that USDe has a total valuation of $6.9 billion, dropping to the fourth spot in the stablecoin market cap rankings.
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Fiat-backed stablecoins grew by $3.2 billion in November
While the synthetic-dollar stablecoin struggled during the month, fiat-backed stablecoins recorded modest but steady gains over the same time period.
Tether’s USDt (USDT) saw a $1.3 billion increase to $184.6 billion, while Circle’s USDC (USDC) climbed to $76.5 billion, adding roughly $600 million to its supply.
PayPal USD (PYUSD) posted the strongest growth among the major dollar-pegged stablecoins, jumping from $2.8 billion to $3.8 billion in November. This marks 1 billion inflow for the month — a 35% month-on-month growth.
DefiLlama data showed that since PayPal PYUSD stablecoin grew by over 216% since September, when it had a market cap of $1.2 billion. This represents a $2.6 billion increase in just three months.
Meanwhile, Ripple’s (RLUSD) stablecoin, which breached a market capitalization of $1 billion for the first time in November, continued its growth throughout the month.
According to CoinGecko, RLUSD went from a $960 million market cap on Nov. 1 to a market cap of $1.26 billion on Nov. 30, marking a $300 million increase.
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