A major recent event in the world of decentralized finance (DeFi) has led to a huge sum of USDe (the DeFi stablecoin) being unstaked, in turn bringing about a surprise shift in USDe staking dynamics.
The developer behind the dashboard @tomwanhh reports that a staggering 880 million USDe were unstaked over the last four days. This has evidently led to some market surprises with analysts, because the annual percentage yield (APY) for USDe stakers has risen sharply during the same time. From myteam, the report was shared that the APY now appears to be around 9.2%, where it had previously been around 3.5% just a few days prior.
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A Shift in Staking Behavior: Unstaking Volume and Rising APY
In the last few days, the most remarkable change has been the rapid decrease in the amount of USDe that was staked on the platform. In only four days, there were 880 million USDe unstaked, and the staking ratio fell from a fairly solid 58% to a much less impressive 43%. This signifies a considerable drop in the amount of USDe that is being utilized to secure network operations and earn staking rewards, thereby raising some eyebrows and causing some sea plus over potential liquidity issues and the long-term sustainability of the staking model.
It is interesting to note that even though the amount of USDe that is staked has gone down, the daily APY that is paid to stakers has shot up from 3.5% to 9.2%. This is, of course, a good development for those who are still holding USDe in staking positions, as the rewards are now more than twice as attractive as they were just days ago. But could this rise in APY also mean that something is amiss with the market? Generally speaking, higher yields are a sign that a lot of assets are leaving staking, which could imply reduced confidence in the platform.
Though the APY increase is attractive for current stakers, it raises questions about network stability. Lower USDe lockup means a possibly decrease in protocol resiliency, and the broader ecosystem health, if this trend persists.
Abraxas Capital’s Large Redemptions: A Closer Look at the Data
One of the main reasons for this latest surge in unstaking activity seems to be the big institutional redemptions, with Abraxas Capital appearing to lead the way. Reported Arkham data suggests Abraxas Capital has redeemed a total of 330 million USDe thus far, which is a significant part of the total of 880 million USDe unstaked in recent days. (This was all prior to yesterday’s continued market dip.) Arkham also seems to suggest that these redemptions are connected to the recent maturity of the Pendle sUSDe pool.
1/ 880M USDe was unstaked in the past 4 days
2/ The staking ratio decreased from 58% to 43%
3/ Silver Lining?
Daily average APY shoot back up from 3.5% to 9.2%4/ Top Unstaking Addresses
According to Arkham's label, 330M unstaking volume comes from Abraxas Capital pic.twitter.com/uzKMIwZcH9— Tom Wan (@tomwanhh) March 31, 2025
Pendle’s sUSDe pool, a prominent DeFi instrument, has played a major role in incentivizing users to lock their USDe in exchange for yields. However, the maturity of these pools often leads to a period of liquidity events, with large players like Abraxas Capital redeeming significant portions of their positions. The timing of these redemptions appears to be the catalyst for the sudden shift in staking behavior and the subsequent drop in the staking ratio.
The influence of these extensive redemptions is serious. They might lead to a real decrease in the amount of USDe that is available for people to use. If Abraxas Capital keeps cashing in its USDe, we’re close to a situation where there might only be 3.something billion USDe usable in the world. That’s less than 4 billion, which some experts see as the floor for how many USDe there should be in circulation for the market to work kind of okay and not be super volatile.
What Does This Mean for USDe’s Future?
While the USDe stablecoin adjusts to these changes, many are left to wonder what they mean for the token’s future. Now that a significant portion of the USDe token is unstaked, goes the thinking, will other large players follow suit and start redeeming their held tokens? If this trend continues, the token’s supply could be further reduced, which would impact its price and its overall stability within the DeFi market.
Additionally, the instantaneous spike in APY could draw in new folks wanting to benefit from the higher rewards, yet it might also be a sign of some deep-rooted issues with the protocol’s staking model. A sharp spike in APY is almost always because there’s been a dip in participation, and while it could seem a positive development for those USDe-staking, it might also be an indicator that the protocol is having a tough time balancing all the necessary elements to maintain the long-term growth we should be able to expect.
The future of the USDe also may depend on how rapidly Abraxas Capital and other big players decide to redeem their holdings. If these institutional players continue to redeem large amounts, it could lead to a further drop in the staking ratio and an even more pronounced tightening of liquidity in the market. Conversely, if these whales decide to hold their positions and allow the staking ratio to recover, the protocol may avoid more significant disruption and may stabilize in the short term.
Looking Ahead: Will the Ecosystem Stabilize?
In the end, the next several days and weeks will be all-important in setting the course of USDe. That the staking ratio is going down, while the redemptions from Abraxas Capital are very large, could signal that we’re at the beginning of a larger trend. Or it could prove to be a short-term liquidity event that the ecosystem has no trouble overcoming. Whatever the case, market participants are on high alert and with good reason. They want to see the protocol stabilize. They want to see it overcome the challenges it’s currently facing and continue to thrive.
Currently, the increase in APY may offer stakers some temporary inducements, but the USDe ecosystem’s long-term viability will rest on its ability to hold onto liquidity, keep a nutritious staking ratio, and survive what could be further redemption strains. The DeFi space remains as unpredictable as ever, and only time will tell how these developments will resolve themselves.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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