CryptoQuant: USDe holders should monitor the Ethena Reserve Fund to avoid risks in a timely manner

Mars Finance News, CryptoQuant stated that USDe holders should monitor the project’s reserve fund to avoid risks associated with potential negative funding rates. It warned that when funding rates turn negative for an extended period of time, Ethena short position holders will need to pay large sums to long position holders.

To this end, Ethena has allocated funds to a reserve fund, but if USDe’s market capitalization continues to grow, the fund will need to increase significantly. The report added: “In order to withstand the bear market, Ethena needs to maintain interest rates above 32%. This will make the reserve fund large enough to withstand extremely negative funding rates during the bear market.” It is reported that Ethena Labs, the company behind USDe Investors who stake USDe or other stablecoins on the platform are currently offered an annual rate of return of 17.2% (rolling average rate over the past seven days).