Just four months after its public launch, Ethena Labs' synthetic dollar, USDe, has surpassed a $3 billion supply. USDe maintains its value through yield-returning cash-and-carry trade and arbitrage mechanics.
Since April 5, the stablecoin's supply has increased by $1 billion, surpassing the $2 billion threshold. If its supply increases by another $2 billion, it will rival DAI as the largest decentralized or algorithmic stablecoin.
Ethena Labs' USDe stablecoin becomes 4th-largest by market cap
The USDe stablecoin currently holds the fourth-largest market cap, accounting for 3.3% of the overall stablecoin market. Tether (USDT) leads with a 57% market share.
Meanwhile, despite this monumental growth, some investors are cautious about USDe due to its rapid rise, comparing it to Terraform Labs's failed UST stablecoin. However, these concerns are unfounded, as each token operates differently. USDe's yield comes from staking revenue and a cash-and-carry trade, which is then distributed to holders.
Recently, the stablecoin integrated with Bybit, offering Bitcoin and Ethereum spot trading pairs. Additionally, Ethena has initiated an airdrop of ENA, its governance token, which has since reached a market cap of $1.4 billion. A synthetic dollar mirrors the value of the US dollar but is not backed by physical dollars held in reserve.
ENA price prediction
As of the time of writing, ENA was trading for $0.956 according to CoinMarketCap data. Its price has surged by over 4% today. Over the past four hours, Ethena has shown a bullish trend, with the 50-day moving average on an incline.
There is a strong trend, as Ethena's 200-day moving average has been sloping up for six days. Based on the way these moving averages are developing, the ENA price prediction would be bearish.
The relative strength index (RSI) is within the range of 30-70, indicating a neutral price trend that is likely to continue in the near future. ENA has seen almost 50% "green days" over the last month. Based on historical data, investing in ENA is currently profitable despite the risks, and it's also a reasonable long-term buy as a store of value.
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