Bybit x Santiment Report: Is Ethena quietly becoming a threat to USDC and Other Stablecoins?

 Unlike traditional stablecoins that are fully backed by fiat reserves, Ethena uses a synthetic model called USDe, which aims to stay pegged to the US dollar through trading and hedging strategies. The company has also introduced a more conventional coin called USDtb, which is backed by real-world assets (RWAs). These dual products show Ethena’s plan to reach both crypto-native users looking for yield, and institutions that demand stability and regulatory compliance.

Ethena’s USDe coin first ascended into the #3 market cap ranking among stablecoins when it surpassed Dai (DAI) in December 2024. After changing positions several times in the first half of 2025, it established itself as the clear stablecoin preference in July 2025, trailing only Tether (USDT) and USD Coin (USDC). With its market cap north of $12.26B, there’s been plenty of speculation that it can continue ascending to challenge Circle.

Comparison of the #2 (USDC), #3 (USDe), #4 (DAI), #5 (FDUSD) and #6 (PYUSD) crypto stablecoins by market cap. Source: Santiment

But at the same time, Circle’s USDC remains one of the most established and trusted stablecoins in the market, currently the #2 market cap among stablecoins (trailing only Tether’s USDT). USDC is widely used by exchanges, payment processors and financial institutions, which makes USDC a tough competitor to challenge. The question we’ll tackle in this article is whether Ethena’s rapid expansion could eventually take a meaningful share of the market from USDC. By looking at Ethena’s partnerships, financial structure and regulatory challenges, we can better understand whether its growth path positions it as a genuine rival — or just another DeFi experiment.