During the market crash on October 10, 2025, Ethena's synthetic stablecoin USDe plummeted to as low as $0.65 on the Binance exchange, representing a 35% drop from its $1 peg. However, Ethena founder Guy Young insisted this was not a true depeg, attributing the issue solely to Binance's internal oracle system, which diverged from broader market data.
Young noted that while USDe's price on Binance crashed, other exchanges like Bybit and Kraken experienced minimal deviations of 5% and 0.80% respectively. On-chain liquidity pools on platforms such as Curve, Uniswap, and Fluid maintained prices within 30 basis points of the peg, consistent with USDC–USDT spreads. Ethena's mint and redemption functions remained operational, processing over $2 billion in transactions within 24 hours, with collateral worth over $9 billion accessible for redemptions.
The price dislocation triggered forced liquidations for leveraged traders using USDe as collateral on Binance, exacerbated by the exchange's unified account system. Analysts like Pavel Altukhov and ElonTrades suggested possible manipulation or technical glitches, with some alleging intentional exploitation of Binance's price feeds. In response, Ethena has advocated for oracle reforms and transparency, offering real-time proof-of-reserves access to providers like Chainlink and Chaos Labs. Tether CEO Paolo Ardoino seized the moment to promote USDT as a safer collateral alternative.
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