Ethena Is Threat to USDC and USDT: Santiment

Ethena’s ecosystem has had quite a year, and analysts suggest the growth isn’t slowing down. According to Santiment, the platform’s native stablecoin, USDe, has rapidly climbed the ranks to become the third-largest stablecoin in crypto, trailing only Tether’s USDT and Circle’s USDC.

📊 Ethena's ecosystem has had quite a year, and we may continue to see market caps grow for $ENA and $USDe. The latter has quickly risen to the #3 largest stablecoin in crypto. We discuss it all in our latest report in collaboration with @bybit_official: https://t.co/Us7J7n37RS pic.twitter.com/EkccEsxVnv

— Santiment (@santimentfeed) October 24, 2025

 

Unlike conventional stablecoins backed entirely by fiat reserves, Ethena’s synthetic model relies on trading and hedging mechanisms to maintain its dollar peg. The company complements this with USDtb, a reserve-backed stablecoin supported by real-world assets.

This dual-coin approach positions Ethena to appeal to both crypto-native investors seeking higher returns and institutions prioritizing stability. Its expansion strategy has emphasized accessibility, culminating in a major breakthrough with the Binance listing of USDe trading pairs.

Growing Adoption and Market Challenges

Ethena’s rise began in late 2024 when USDe surpassed Dai (DAI) in market cap, briefly trading places before solidifying its position in mid-2025. Now, with a market cap exceeding $12.26 billion, many in the crypto community see Ethena as a potential challenger to USDC.

Over the past six months, Ethena’s user base has surged. The number of non-empty USDe wallets rose 72%, reaching over 32,500 holders by October 2025. However, the project faced a notable challenge when USDe briefly lost its peg during the October 10 flash crash.

This sparked debate over the resilience of synthetic stablecoins. Despite that setback, confidence has largely rebounded as Ethena strengthens its collateral and risk-management mechanisms.

Stablecoin Market Surge

This surge in USDe demand comes amid a booming stablecoin sector. The passage of the Genius Act in June 2025 provided regulatory clarity and has fueled further adoption.

The total stablecoin market cap has reached $316 billion at the time of writing, the 25th straight month of growth. Monthly transaction volumes doubled year-over-year, now exceeding $4 trillion.

Analysts now predict the market could top $500 billion by 2026 as institutional interest continues to expand.

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