Ethena (ENA) Price Jumps 7% as USDe Enters Top Three Stablecoin List

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As a seasoned crypto investor with over a decade of experience under my belt, I must admit that the recent surge in Ethena’s native crypto ENA and its USDe stablecoin has piqued my interest significantly. The 7% rise in ENA over the past 24 hours, coupled with a staggering 160% monthly gain, is nothing short of impressive.

Ethena’s native cryptocurrency, ENA, experienced a 7% increase over the last 24 hours, breaking through the $0.90 barrier and reaching a market capitalization of approximately $2.66 billion. Additionally, the daily trading volume saw a 55% surge, exceeding $730 million, signaling robust bullish activity. The price rally of ENA is likely due to increased demand for its USDe stablecoin.

For the last seven days, the Ethena (ENA) price has soared approximately 40%, and this monthly surge now reaches an impressive 160%. This uptrend appears to be bolstered by substantial whale activity in Ethena, with BitMEX co-founder Arthur Hayes reportedly amassing a significant amount of ENA.

Ethena’s USD-equivalent digital currency, USDe, has rapidly grown to become one of the fastest expanding USD-tied stablecoins. In just the last 30 days, its market value has skyrocketed by 73% to an impressive $4.84 billion. As a result, it currently ranks as the third largest stablecoin available, surpassing DAI with a market cap of $4.71 billion. Guy Young, co-founder and CEO of Ethena Labs, has commented on this growth:

“As USDe blackholes affect every stablecoin in DeFi, causing disruption and changing lending market rates drastically, it has become clear that DeFi is currently too small to completely close the arbitrage gap. To address this, Ethena plans to connect directly with asset managers holding $100 billion to trillion-dollar portfolios, who can provide the necessary capital.

Ethena’s USDe Provides Highest Yield-Bearing

Market analysts have observed that the surge in USDe is fueled by robust fundamentals, spurred on by optimistic investor sentiment and increased interest in assets offering alternative returns. Conversely, USDT, USD Coin (USDC), which are primarily used for transactions, see most of their tokens being held as a means to accrue rewards. This suggests that the majority of users regard USDe less as a medium of exchange, but more as an asset generating yields.

On their official site, it’s clear that USDe holders could potentially earn an impressive 29% yearly return (yield). However, some skeptics have noted similarities between Ethena’s system and the failed Terra-Luna initiative. Unfortunately, Terra’s algorithmic stablecoin crumbled in May 2022 when its rapid expansion plan proved unsustainable, leading to a significant market slump in the cryptocurrency sector.

Although there are some concerns, the demand for this entity is robust, evident in its supply and lending rates for APR that outshine those of USDT and USDC on Aave. Notably, the DeFi protocol Ethena has teamed up with Derive.xyz, a leading derivatives platform on-chain, to boost liquidity and stimulate growth for both systems. In a statement on December 3, Ethena disclosed that this partnership involves significant investments in the millions.

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2024-12-04 18:36