- OKX CEO Star Xu clarified that USDe is just not a stablecoin, however a tokenized hedge fund.
- Mr. Xu praised Ethena Labs’ danger administration and transparency.
- He referred to as on exchanges to use sturdy danger controls earlier than treating USDe as collateral.
OKX CEO Star Xu clarified that the sharp decline in USDe costs shouldn’t be seen as stablecoin depegging, however as market stress on artificial greenback merchandise.
Xu referred to as USDe a “tokenized hedge fund” constructed by Ethena Labs, saying merchants misunderstand its construction as a stablecoin that provides risk-free yield.
His response was primarily based on detailed evaluation by AltLayer founder YQ Jia, who advised that the October 10-11 market crash could have been a coordinated assault on Binance and USDe holders.
Whereas acknowledging the validity of Jia’s evaluation, he harassed that the narrative surrounding “USDe depegging” is basically flawed.
USDe is just not greenback pegged and works extra like a structured fund
Xu defined that USDe’s delta impartial technique combines crypto collateral and futures gross sales to steadiness publicity. Though such a setup goals for low volatility, it nonetheless carries the chance of funding charges and liquidation in excessive conditions.
“Calling USDe a stablecoin is deceptive to merchants,” Xu stated. “It capabilities extra like a structured funding car than a set asset.”
He added that this mannequin is just not a easy stablecoin experiment, however displays the following stage of on-chain cash market engineering.
Athena’s transparency praised regardless of market shocks
Mr. Xu praised Ethena Labs for sustaining transparency relating to collateral and danger metrics regardless of the decline.
He stated Ethena’s public dashboard and reserve proof disclosure set a brand new benchmark for on-chain danger administration transparency.
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OKX, an early angel investor in Ethena’s ENA token, could increase assist for USDe as soon as volatility stabilizes.
Xu stated that to keep away from alternate collateral danger throughout occasions of liquidity crunch, exchanges want to use dynamic danger administration earlier than accepting artificial property like USDe as collateral.
Shift focus to regulation and danger classification
USDe’s plunge to $0.6567 introduced again reminiscences of the LUNC and UST collapses, however Xu argued that evaluating it to these algorithmic stablecoins misses the nuance.
As a result of USDe distributes yield by spinoff publicity, regulators could view it as a security-like product relatively than a funds stablecoin.
Analysts count on the SEC and Asian regulators to evaluate whether or not such artificial asset fashions match into the present framework for tokenized funds. So Xu’s broader message is to grasp your merchandise earlier than you label them and construct guidelines that match your precise danger profile, not advertising and marketing catchphrases.
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