sUSDe yield and the basis trade shift
sUSDe yields reached 5.06% on October 29, 2026, following a shift in reserve composition where DeFi lending now accounts for 35% of backing. This rate remains higher than the 3.75% Sky Savings Rate for sUSDS despite a decrease in USDe supply.
On October 29, 2026, sUSDe yields 5.06% on Ethereum, which remains significantly lower than the double-digit returns that characterized the asset during the high-momentum market phases of 2024. This rate sits below the 30-day average of 4.99% and remains far from historical highs. The yield comes from funding rate arbitrage and staking rewards, though the composition of the USDe reserve changed significantly. The protocol manages risk through a diverse backing strategy. As of October 25, 2026, DeFi lending accounts for 35% of the USDe reserve. Stablecoins make up 27% of the total backing. Institutional lending contributes 15%, while hedged crypto accounts for the remaining 15%. This shift reduces the protocol’s dependence on the delta-neutral basis trade. The supply of USDe fell to $4.53 billion by October 29, 2026, from a peak of $14.82 billion in October 2025. The protocol maintains a solvency level of 101.4% against $4.59 billion in backing as of October 25, 2026. The Reserve Fund holds approximately $62.07 million to cover periods when funding turns negative. The annualized run-rate for protocol revenue accelerated to $234 million by April 2026.
sUSDe versus Sky and Ondo
sUSDe yields generally exceed those of Sky’s sUSDS, which relies on the Sky Savings Rate. As of Q2 2026, Sky governance set the Sky Savings Rate at 3.75%. You might notice the spread narrowing between synthetic and treasury-backed tokens.
| Asset | Yield Source | Current Rate (Oct 2026) |
|---|---|---|
| sUSDe | Perp funding and staking | 5.06% |
| sUSDS | Sky Savings Rate | 3.75% |
Ondo’s USDY uses treasury bills to generate interest. sUSDe stays uncorrelated with government debt because it relies on market sentiment. The Sky system generates surplus from stability fees and liquidation revenue. sUSDS functions as a tokenized implementation of the Sky Savings Rate. Unlike USDe, which uses a delta-neutral hedge, Sky’s system uses a stability fee to generate surplus. The Sky system also allocates excess surplus to either accumulating SKY or redepositing tokens alongside USDS into an AMM liquidity pool. Users access the Sky Savings Rate on Base by swapping USDS or USDC for sUSDS on the PSM3. USDe circulation reached $4.6 billion on October 25, 2026.
Liquidity, redemptions, and volatility
Unstaking USDe requires a cooldown period. Ethena uses a dynamic model that adjusts between 1, 3, 5, or 7 days. On October 25, 2026, the cooldown remained at 1 day. If you prefer immediate liquidity, you can trade sUSDe on the secondary market at a discount.
The October 10, 2025, volatility event demonstrated how venue liquidity affects the peg. During that period, USDe dropped to 0.65 on Binance because Binance used its own order book for pricing. On-chain pools on Ethereum and Plasma maintained a tighter peg near 0.99. The protocol handled $1.9 billion in redemptions between October 10 and October 11 without mechanical stress. Binance eventually paid about $300 million in compensation to affected users. The April 2026 rsETH incident also tested the system when attackers took $292 million from KelpDAO’s bridge. This event forced leveraged loops built on USDe and sUSDe to unwind. The Ethena risk team monitors margin ratios to maintain 2x maintenance margin on each venue. Will funding rates return to 2024 levels if crypto volatility increases?
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