USDe circulating supply has shrunk by 70% since the October bull market peak, when it topped $14 billion.
Stablecoin infrastructure company StablecoinX has completed its merger with TLGY Acquisition Corp, a publicly traded special purpose acquisition company, allowing it to begin trading on Nasdaq on Friday.
StablecoinX is the first public stablecoin infrastructure company focused on supporting the Ethena ecosystem through decentralized verifier nodes and software infrastructure, and will trade under the symbol “USDE,” according to a statement on Thursday.
“We believe Ethena has emerged as one of the most important platforms powering the next generation of digital dollars,” said Edward Chen, CEO and Chairman of StablecoinX.
The Nasdaq debut is a big bet that stablecoins are becoming the plumbing of global finance, and comes despite a broader crypto bear market and Ethena’s relatively small 1.4% market share of the stablecoin market compared with those offered by its competitors, such as Tether and Circle.
Ethena’s USDe is a yield-bearing synthetic dollar-pegged stablecoin. Unlike USDt (USDT) or USDC (USDC), which are backed by actual dollars, USDe (USDE) maintains its $1 peg through a derivatives strategy.
It is backed by crypto collateral in Bitcoin and Ether and short futures positions on those same assets, enabling the long and short positions to cancel out the price volatility, helping to keep its value at approximately $1.
Ethena’s delta-neutral strategy works well in normal markets but is vulnerable during periods when futures funding rates go negative.
While stablecoin circulation has grown in recent years, USDe market capitalization has declined by 70% since its peak in October to around $4.5 billion today, ranking it sixth among stablecoins.
USDe supply has fallen since the bull market peak. Source: CoinGecko
StablecoinX’s treasury also holds approximately 3 billion Ethena governance tokens (ENA), or around 20% of the total supply, valued at approximately $275 million. The company announced a $360 million capital raise to purchase ENA on Sunday.
However, the asset is currently trading at $0.08, down 94% from its April 2024 all-time high.
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