Ethena’s USDe Contracts as Dollar Stablecoins Hit Supply Milestones

Core Insights - USDe, a synthetic-dollar stablecoin by Ethena, has experienced a significant decline in its monthly supply, dropping from a market capitalization of $9.3 billion on November 1 to $7.1 billion by November 30, indicating a sharp contraction in its value [1][2] - The overall stablecoin market is witnessing substantial growth, with fiat-backed stablecoins like USDT, USDC, and PayPal's PYUSD attracting billions in inflows [4][6] Group 1: USDe Performance - USDe has recorded approximately $2.2 billion in redemptions, reflecting a 24% decline in supply for November, as per Coingecko data [2] - The decline in USDe's outflows suggests that users may be swapping USDe on the open market or withdrawing from liquidity pools, potentially unwinding their positions on Decentralized Applications (DApps) [3] Group 2: Competitor Analysis - PayPal's PYUSD has seen its market capitalization grow from $1.2 billion in September to over $3.8 billion, attributed to the introduction of a 3.7% yield for users holding PYUSD in PayPal or Venmo wallets [4][5] - The total stablecoin market cap stands at $311 billion, with USD-backed tokens dominating at approximately $303 billion, highlighting the competitive landscape [6]