Maitong MSX Research Institute: Why did USDe survive while LUNA went to zero, despite both being stablecoins that lost their peg?

The Intersection of the October 2025 Decoupling Event and Hayek's Predictions

On October 11, 2025, panic in the crypto market triggered an extreme shock to the synthetic stablecoin USDe ------ during an "epic crash" where Bitcoin plummeted from $117,000 to $105,900 (a single-day drop of 13.2%) and Ethereum fell 16% in one day, USDe briefly dropped to around $0.65 on October 11, 2025 (a decline of about 34% from its $1 peg), before recovering within hours. During the same period, the global crypto market saw a liquidation amount soar to $19.358 billion in 24 hours, with 1.66 million traders forced to close their positions, setting a record for the largest single-day liquidation in history.

From a micro-market perspective, the liquidity pool depth of USDe-USDT on the decentralized exchange Uniswap was only $3.2 million at the peak of the event, shrinking by 89% compared to before the event, leading to a 25% discount on a sell order of 100,000 USDe due to slippage (order price $0.70, actual transaction price $0.62); at the same time, six leading market makers faced a liquidation risk of a 40% drop in margin value as they used USDe as cross-margin, further exacerbating the market liquidity crisis.

However, this "crisis" saw a key reversal within 24 hours: the price of USDe gradually rose back to $0.98, and third-party reserve proofs disclosed by Ethena Labs showed that its collateralization ratio remained above 120%, with an over-collateralization scale of $66 million; more critically, the user redemption function remained normal, allowing assets such as ETH and BTC in the collateral to be redeemed at any time, which became the core support for restoring market confidence.

The MaiTong MSX Research Institute believes that this "drop - recovery" curve sharply contrasts with the complete zeroing out that followed the LUNA-UST decoupling in 2022, making this event transcend the ordinary "stablecoin volatility" category ------ it became the first extreme stress test of Hayek's theory of "The Denationalization of Money" in the digital age.

In 1976, Hayek proposed in "The Denationalization of Money" that "money, like other goods, is best provided by private issuers through competition rather than by government monopoly." He believed that the government's monopoly on money issuance "is the source of all the ills of the monetary system," and the biggest problem with the monopoly mechanism is that it hinders the discovery of better forms of money. Under the competitive framework he envisioned, privately issued money must maintain stable purchasing power, or it will be eliminated by the market due to loss of public trust; therefore, competitive money issuers "have a strong incentive to limit their quantity or lose their business."

Half a century later, the emergence of USDe precisely reflects this contemporary expression of thought. It does not rely on sovereign fiat currency reserves but is supported by consensus assets in the crypto market, maintaining stability through derivatives hedging, with its credibility and circulation entirely dependent on market choice and technological transparency. Regardless of the outcome of the decoupling and recovery in October 2025, the practice of this mechanism can be seen as a real-world experiment of Hayek-style "competitive discovery of quality money" ------ validating the potential self-regulating power of the market in monetary stability and revealing the institutional resilience and evolutionary direction of digital private money in complex environments.

Mechanism Innovation of USDe

The "collateral - hedging - yield" trinity structure of USDe permeates the logic of spontaneous market adjustment rather than centralized design constraints, which aligns closely with Hayek's emphasis that "market order arises from individual spontaneous actions."

Collateral System: The Value Base Built on Market Consensus

The choice of collateral for USDe fully follows the liquidity consensus of the crypto market ------ ETH and BTC together account for over 60%, and these two assets are not designated by any institution but have been recognized by global investors as "hard assets of the digital world" over more than a decade of trading. The auxiliary liquid staking derivatives (WBETH, BNSOL, etc.) are also products spontaneously born from the market to enhance capital efficiency, allowing for staking yields while not sacrificing liquidity; the 10% share of USDT/USDC serves as a "transitional stable tool" chosen by the market, providing a buffer for USDe during extreme market conditions.

The entire collateral system consistently maintains an over-collateralized state, with a collateralization ratio still exceeding 120% at the time of the October 2025 incident, and real-time valuation and automatic liquidation are managed by smart contracts.

Stability Mechanism: Spontaneous Hedging in the Derivatives Market

The core difference between USDe and traditional fiat-collateralized stablecoins lies in its independence from "fiat reserves backed by national credit," instead achieving risk hedging through short positions in the derivatives market. The essence of this design is to leverage the liquidity of the global crypto derivatives market to allow the market itself to absorb price fluctuations ------ when the price of ETH rises, the profits from spot assets offset the losses from shorts; when the price of ETH falls, the profits from shorts compensate for the losses in the spot market, all without any centralized institutional intervention, driven entirely by market price signals.

When ETH plummeted 16% in October 2025, this hedging mechanism experienced a brief lag due to an instantaneous depletion of liquidity, but it did not fail ------ the short positions held by Ethena Labs ultimately generated $120 million in unrealized gains, and these profits did not come from administrative subsidies but from voluntary trading between long and short positions in the derivatives market.

Yield Mechanism: Spontaneous Incentives to Attract Market Participation

The "staking yield + circular lending" model designed by USDe is not the "rigid repayment of high interest" found in traditional finance, but rather a reasonable compensation for market participants taking on risk. The basic 12% annualized subsidy comes from the spontaneous investment of ecological funds to "increase the circulation of money"; the mechanism that amplifies leverage to 3-6 times and achieves annualized returns of 40%-50% through circular lending essentially allows users to autonomously choose the matching of risk and return ------ users willing to take on higher leverage risks can achieve higher returns; those with lower risk preferences can opt for basic staking.

Comparison of Three Types of Stablecoin Mechanisms: The Divide Between Market Choice and Administrative Intervention

The Truth of Market Tests: Why USDe Can Distinguish Itself from LUNA-UST

The decoupling event in October 2025 is often misunderstood as a "similar risk exposure" between USDe and LUNA-UST, but from the perspective of the Austrian School, the essential differences between the two are precisely highlighted in this test ------ the recovery of USDe is a success of "non-nationalized currency undergoing market testing," while the collapse of LUNA-UST is the inevitable outcome of "pseudo-innovation detached from real assets."

The Essential Difference in Value Anchors: Real Assets vs. Void Expectations

The value anchor of USDe is real assets such as ETH and BTC that can be redeemed at any time; even in extreme market conditions, users can still obtain equivalent crypto assets through the redemption mechanism ------ during the decoupling in October 2025, the redemption function of USDe remained operational, and third-party reserve proofs showed over-collateralization of $66 million, which is the foundation of market confidence based on this "redeemable value commitment."

In contrast, LUNA-UST had no real asset backing; its value relied entirely on "user expectations of LUNA's price." When market panic erupted, the redemption mechanism of UST required the issuance of more LUNA, and the infinite issuance of LUNA ultimately lost its value, leading to the collapse of the entire system. This "currency without asset backing" violated Hayek's principle that "money must have a real value basis" from the very beginning, making its collapse inevitable.

The Logical Difference in Crisis Response: Market Spontaneous Repair vs. Administrative Intervention Failure

USDe's response after decoupling completely followed market logic: Ethena Labs did not issue an "administrative order-style rescue plan," but instead conveyed signals of "mechanism transparency and asset safety" to the market through public reserve proofs, optimizing the collateral structure (reducing the proportion of liquid staking derivatives from 25% to 15%), and limiting leverage multiples, ultimately relying on users' spontaneous trust to achieve price recovery.

In contrast, LUNA-UST's response during the crisis was a typical case of "administrative intervention failure": the Luna Foundation Guard attempted to rescue the market by selling Bitcoin reserves, but such centralized operations could not withstand the spontaneous sell-off from the market ------ Bitcoin itself also experienced a decline during extreme market conditions, and the reserve assets were highly correlated with UST risks, leading to the failure of the rescue.

The Difference in Long-Term Viability: Market Adaptability vs. Mechanism Fragility

After the decoupling, USDe not only restored its price but also enhanced its long-term adaptability through mechanism optimization: limiting circular lending leverage to 2 times, introducing compliant government bond assets (USDtb) to enhance collateral stability, and diversifying hedging positions across exchanges ------ these adjustments did not come from administrative orders but were spontaneous responses to market feedback, making the mechanism more aligned with the market principle of "matching risk and return."

In contrast, LUNA-UST lacked market adaptability from the outset: its core Anchor protocol's 20% high interest relied on continuous subsidies from ecological funds rather than real payment demand (the actual payment scenarios for UST accounted for less than 5%). When subsidies could not be sustained, the funding chain broke, and the entire system collapsed instantly. This model of "relying on unsustainable administrative subsidies" is doomed to fail in market competition.

Mechanism Flaws and Critical Reflection: The Growing Pains of Non-Nationalized Currency

The innovative value of USDe is undeniable, but the pressure test in October 2025 and its daily operations still reveal deviations from Hayek's idea of "complete market self-regulation," exposing risks that need to be heeded. These flaws are not essential defects that cannot be corrected but are obstacles that must be overcome in its evolution toward mature non-nationalized currency.

Concentration Risk in Collateral: Systemic Binding to Crypto Asset Cycles

Over 60% of USDe's collateral is concentrated in ETH and BTC, which, while aligning with the current liquidity consensus of the crypto market, falls into the dilemma of "binding to a single market cycle." The decoupling in October 2025 was essentially a chain reaction triggered by a unilateral decline in the crypto market ------ when ETH plummeted 16% in one day, even with derivatives hedging, the instantaneous shrinkage of collateral market value still triggered market panic.

What is even more concerning is that the current auxiliary collateral in the form of liquid staking derivatives (WBETH, etc.) has not detached from the Ethereum ecosystem, essentially being a "secondary derivative of crypto assets," failing to achieve true risk diversification. This "internal circulation of crypto assets" in the collateral structure appears fragile compared to the logic of traditional currency relying on the value of the real economy.

Limitations of the Hedging Mechanism: Implicit Dependence on Centralized Exchanges

USDe's derivatives hedging heavily relies on the liquidity of leading centralized exchanges; the brief lag in the hedging mechanism in October 2025 was caused by a liquidity gap due to a leading exchange suspending perpetual contract trading. Currently, about 70% of USDe's short positions are concentrated in two exchanges, making it difficult to completely escape passive acceptance of centralized platform rules.

Moreover, the drastic fluctuations in funding rates expose the singularity of the hedging tools. USDe currently relies solely on perpetual contracts for risk hedging, lacking a diversified combination of tools such as options and futures, making it challenging to quickly adjust hedging strategies when long and short forces are extremely imbalanced, reflecting that its mechanism design has not fully utilized the market's diverse risk pricing capabilities.

RWA Anchoring Upgrade: The Advancement Path of Non-Nationalized Currency

In light of the existing mechanism flaws, integrating RWA assets such as gold tokens and US stock tokens to optimize the anchoring system is not only a precise correction of USDe's deficiencies but also an inevitable choice in line with the explosive trend of the RWA market (projected to reach $26.4 billion in 2025, a year-on-year increase of 113%). This upgrade does not deviate from the core of non-nationalization but rather enhances the vitality of Hayek's ideas in the digital age by connecting with the value of the real economy.

The Underlying Logic of RWA Anchoring

The value of money should stem from real assets with broad market consensus, and RWA assets possess this attribute ------ gold, as a millennium-old hard currency, has a value consensus that transcends countries and eras; US stock tokens correspond to the real economic returns of listed companies, anchoring the ability of enterprises to create value; government bond tokens rely on the tax capacity of sovereign nations, providing a low-volatility value benchmark. The value of these assets does not depend on the crypto market cycle but comes from production and trade in the real world, capable of building a "cross-market value buffer" for USDe.

The BUIDL token launched by BlackRock in 2024 (anchoring assets such as US government bonds) has already validated the feasibility of RWA anchoring. Its core difference from USDe lies in that BUIDL relies on centralized institutions for issuance, while USDe can achieve decentralized confirmation and valuation of RWA assets through smart contracts, truly practicing the logic of "market spontaneous management."

Adaptation and Configuration Strategies for Diverse RWA Assets

The RWA anchoring upgrade of USDe should follow the principles of "market consensus first, risk diversification adaptation," and in conjunction with the current maturity of RWA tokenization, a "core - auxiliary - flexible" three-layer configuration system can be constructed, as shown in the table below:

This configuration can reduce the proportion of crypto asset collateral in USDe from the current 80% to 40%-50%, preserving the liquidity advantages of the crypto market while achieving cross-market risk diversification through RWA assets. For example, the price correlation between gold tokens and ETH is only 0.2, allowing gold tokens to serve as a "value anchor" during declines in the crypto market, preventing panic from concentrated sell-offs like in October 2025.

Reinsights from the Austrian School: The Evolutionary Logic from Innovation to Maturity

The flaws of USDe and the RWA upgrade path further confirm the profound implications of Hayek's "The Denationalization of Money": non-nationalized currency is not a static mechanism design but a dynamic market evolution process, and only through continuous self-correction and innovation can it succeed in monetary competition.

The Evolution of Value Foundations: From Single Market Consensus to Cross-Domain Value Anchoring

The current crypto asset collateral of USDe represents the "primary form" of non-nationalized currency in the digital age ------ its value consensus is limited to participants in the crypto market. By integrating RWA assets, the essence is to expand the value consensus to traditional finance and the real economy, upgrading USDe's value foundation from "digital consensus" to "cross-domain real value." This evolution fully aligns with Hayek's assertion that "the value of money should stem from the broadest market trust"; when USDe anchors diverse assets such as crypto assets, gold, and US stocks, its ability to withstand risks from a single market will significantly improve, truly becoming a "value carrier that transcends sovereignty and single markets."

The Improvement of Adjustment Mechanisms: From Single Tools to Diverse Market Synergy

Currently, USDe's hedging mechanism relies on a single derivatives market, reflecting "insufficient utilization of market tools." Hayek emphasized that "market self-repair" should be based on diverse market synergy ------ the integration of RWA assets not only enriches the collateral but also creates the possibility of synergistic hedging between the "crypto derivatives market + traditional financial market." For example, the volatility of US stock tokens can be hedged through traditional stock options, while gold tokens can connect with forward contracts in the London gold market, making the hedging mechanism more resilient and avoiding dependence on the liquidity of a single market.

Conclusion: The Leap from Innovation Benchmark to Evolutionary Model

The market test in October 2025 not only validated the value of USDe as a benchmark for non-nationalized currency innovation but also revealed its inevitable path from "primary innovation" to "mature currency." Its essential distinction from LUNA-UST lies in real value support and market adjustment capability; while its current mechanism flaws are the unavoidable costs of growth in the innovation process.

The MaiTong MSX Research Institute believes that the upgrade strategy integrating RWA assets such as gold tokens and US stock tokens provides a clear evolutionary direction for USDe ------ this is not a denial of existing innovations but a deepening and refinement guided by Hayek's ideas.

For market participants, the evolutionary journey of USDe offers deeper insights: the core competitiveness of non-nationalized currency lies not only in the courage to break sovereign monopolies but also in the ability for continuous self-correction; the standard for judging its value is not only short-term stability but also long-term resilience in connecting with real value and adapting to market evolution. Once USDe completes the RWA upgrade, it will no longer be just an innovative experiment in the crypto market but a true "cross-domain value carrier" with the potential to challenge traditional monetary systems.