StablecoinX debuts on Nasdaq as Ethena's USDe supply collapses 70%
In brief
- StablecoinX merged with TLGY and started Nasdaq trading under ticker USDE Friday
- USDe supply collapsed 70% from October's $14 billion peak to $4.5 billion
- StablecoinX raised $360 million to acquire ~20% of ENA governance token supply
- Ethena controls just 1.4% of the stablecoin market, behind Tether and Circle
- ENA token down 94% from April 2024 all-time high, trading at $0.08
The Ethena Bet
StablecoinX completed its merger with TLGY Acquisition Corp and began trading on Nasdaq on Friday under the symbol USDE. Edward Chen, CEO and Chairman, said the company believes Ethena represents a critical platform for the next generation of digital dollars.
The timing reflects a bold wager. USDe circulating supply has shrunk by 70% since the October bull market peak, when it topped $14 billion. Today that supply sits around $4.5 billion. Ethena holds just 1.4% market share of the stablecoin market, trailing giants like Tether and Circle.
How USDe Works
USDe is a yield-bearing synthetic dollar-pegged stablecoin that maintains its $1 peg through a derivatives strategy. Unlike traditional stablecoins such as USDT or USDC, USDe is backed by crypto collateral in Bitcoin and Ether and short futures positions on those same assets. This delta-neutral approach lets Ethena generate yield for users.
The model has a vulnerability. Ethena's delta-neutral strategy works well in normal markets but is vulnerable during periods when futures funding rates go negative. When hedges flip, the peg can weaken.
StablecoinX's Capital Raise
StablecoinX announced a $360 million capital raise to purchase ENA on Sunday. The company's treasury now holds approximately 3 billion Ethena governance tokens (ENA), representing around 20% of the total supply, valued at approximately $275 million.
ENA is currently trading at $0.08, down 94% from its April 2024 all-time high.
StablecoinX operates three business lines: a decentralized verifier node (DVN), a middleware software stack called Stablecoin Harness, and distribution services. The public listing gives the company access to capital markets at a moment when the broader crypto market has tanked 52%, with $2.3 trillion leaving the space since October.
