Ethena Catches The Eye as Stablecoin Supply Jumps 75% In a Month

Ethena’s USDe stablecoin supply has grown by 75% over the past month, reaching $9.3 billion. The rise has pushed it ahead of FDUSD, making it the third-largest stablecoin after USDT and USDC.

This expansion has also lifted Ethena (ENA) to the sixth position among decentralized finance (DeFi) protocols by total value locked, according to DeFiLlama. Analysts attribute the surge in minting to strong staking yields and recent corporate actions within its ecosystem.

High Yields and Strategic Moves Fuel Ethena’s Momentum

On-chain data shows that staked USDe (sUSDe) currently offers an annualized yield of about 9%, supported by high perpetual funding rates during the market rally. These returns have drawn more participants, creating a cycle of fresh USDe issuance.

Similar supply spikes occurred in May and December 2024 when high yields and strong market momentum fueled the same pattern. The present rally, combined with elevated funding rates, appears to be driving a repeat of that trend.

Adding to the momentum, the launch of StableCoinX, a treasury company, on July 21 introduced a new source of demand. It pledged to purchase $260 million worth of ENA tokens, equal to about 8% of the circulating supply at the time.

Notably, the Ethena Foundation holds the authority to block any sale of these tokens. This ensures the tokens remain allocated for reinvestment and infrastructure rather than re-entering market circulation.

USDe Demand Boosts Ethena

In a recent post on X (formerly Twitter), founder Guy Young noted that USDe inflows in less than 20 days are up $3.1 billion. Notably, this figure exceeds the combined inflows to all bitcoin ETFs and BlackRock’s ETHA Ethereum ETF within the same period.

Remarkably, the sharp rise in inflows has coincided with Ethena’s total value locked (TVL) climbing to $9.5 billion and revenue increasing. The parallel movement suggests a strong link between USDe demand and the protocol’s overall performance.

This strong demand has also spilled over into ENA’s market performance, with the token surging 140% in the past month. The rally sharply outpaced bitcoin’s 6% rise and Ethereum’s 40% gain over the same period.