Binance USDe Depeg: Internal Oracle Issue, Not Ethena Protocol Problem

A brief loss of the synthetic dollar USDe’s peg on Binance occurred during Friday’s market crash, plummeting as low as $0.65. However, this event was attributed to an internal oracle malfunction, not issues with the Ethena protocol or its collateral, according to Guy Young, founder of Ethena Labs. Young clarified that USDe’s core mechanisms functioned correctly, with minting and redemption continuing smoothly during the crash. Price deviations were limited at less than 30 basis points as $2 billion in USDe was redeemed across platforms like Curve, Fluid, and Uniswap within a day.