Headline: Ethena’s USDe Loses $8.3B as October crash Sparks Deleveraging and Confidence Shock
Ethena’s synthetic dollar USDe has seen roughly $8.3 billion in net outflows since the massive market liquidation on Oct. 10, underscoring a broader loss of confidence in leveraged and synthetic collateral structures, according to a new report from 10x Research.
The October meltdown marked a structural turning point for crypto markets, the report says — switching the cycle from bull-driven expansion to a sustained period of deleveraging. The crash wiped out about $1.3 trillion in market value, roughly 30% of total crypto market capitalization at the time.
Why USDe was hit hard
USDe is backed by synthetic collateral and hedging mechanisms rather than fiat reserves. That model came under intense stress during the sell-off. CoinMarketCap data shows USDe’s market cap fell from about $14.7 billion on Oct. 9 to roughly $6.4 billion in just over two months.
The stablecoin also briefly lost its peg after the Oct. 10 crash, plunging to about $0.65 on Binance. Ethena Labs founder Guy Young said that the drop on Binance was caused by an internal oracle issue at the exchange — not by failures in USDe’s collateral, protocol, or redemption mechanics. He added that minting and redemptions functioned normally during the event, with approximately $2 billion redeemed within 24 hours across major DeFi venues and only minor price deviations elsewhere.
At the time of writing USDe is trading around $0.9987, per CoinMarketCap.
The wider fallout
The Oct. 10 event was the largest liquidation episode in crypto history: CoinGlass reports more than $19 billion in positions liquidated and a roughly $65 billion decline in open interest. Market activity has thinned since then — overall trading volumes are down by about 50% — and US-listed spot Bitcoin ETFs have seen about $5 billion in net outflows since late October.
10x Research frames the current weakness not as retail capitulation but as a pullback by regulated capital. With leverage and liquidity retreating, Bitcoin has reportedly decoupled from equities and gold and is trading more like an isolated risk asset than a macro hedge.
What this means
The USDe episode highlights how synthetic collateral frameworks can be particularly vulnerable in extreme liquidity events, even when protocol mechanics hold up. For traders and institutions, the crash underlines renewed emphasis on liquidity, on‑chain reserves, and exchange infrastructure (like oracle integrity) — and suggests a more cautious, regulated-capital-driven market environment for the near term.
For ongoing coverage and analysis on market structure and stablecoins, follow developments from Ethena, CoinMarketCap, CoinGlass and research outlets such as 10x Research.
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