Guy Young, the founder of Ethena Labs, stated that the recent price drop of the USDe stablecoin on Binance
$17.65B
Instead, he pointed to the way Binance handled price data during a broader market selloff.
According to Young, the system used to create and redeem USDe worked as intended throughout the event. Over a 24-hour period, users exchanged around $2 billion worth of USDe on platforms like Uniswap
$403.75M
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He explained that the main issue was that Binance used its own trading data to determine USDe’s price. At the time, Binance’s order book for USDe had limited liquidity, which led to a price drop than on other platforms.
Young said this approach caused the price on Binance to fall to $0.65, while elsewhere, USDe stayed closer to its expected value.
He also noted that Binance had restrictions on deposits and withdrawals during the event, which prevented traders from correcting the price difference.
Meanwhile, a trader known as ElonTrades suggested that Binance’s “Unified Account” feature played a role. This system allowed traders to use USDe as collateral and was based on Binance’s internal price data.
Since Binance had not yet switched to using outside price sources, a change planned for October 14, attackers may have used this gap to their advantage. ElonTrades claimed that up to $90 million in USDe was sold on Binance to drive down its price.
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