Welcome to Ethena’s monthly governance update for May 2026, covering all major developments across the month. This report highlights the continued supply recovery following the April rsETH incident, the Risk Committee’s active work on expanding the USDe backing asset universe and the protocol’s deepening institutional and Solana footprint.
Key Takeaways
- Supply Recovery: USDe supply grew from $3.90B at end April to $4.51B by end May, a 15.6% recovery driven by renewed mint demand as post rsETH redemption pressure resolved.
- Yield: sUSDe 30-day moving average APY held near 4% throughout May. With liquid cash representing 89% of backing, protocol yield is primarily driven by DeFi lending rates and perpetual funding rates playing a secondary role given the 9% basis trading allocation.
- Protocol Solvency and Reserve Fund: The protocol remains fully collateralized at 101.51%. The Reserve Fund stands at $62.5M, approximately 22 times the Risk Committee’s recommended minimum of $2.84M. Total backing is $4.5B with $4.0B liquid cash (89%) and $391M in BTC and ETH basis trading positions (9%).
- Backing Expansion Proposals: The Risk Committee published three new backing asset proposals in May: USDG and RLUSD onboarding, USDe lending into Kamino and Jupiter on Solana.
- Solana DeFi Expansion: Kamino and Jupiter Lend were onboarded as lending venues for USDe backing assets. The Ethena markets on both platforms collectively surpassed $1B in TVL within days of launch. ENA launched on Solana via Sunrise DeFi (May 14), and Grayscale added ENA to its DeFi Fund at a 13.59% allocation (May 7).
- Whitelabel Contraction: Total Whitelabel stablecoin supply (jupUSD, USDm, suiUSDe) contracted from approximately $560M at the start of May to approximately $300M by month end, primarily driven by USDm (MegaETH) supply moderation.
- DeFi Footprint: Aave TVL related to Ethena assets closed May at approximately $580-600M, recovering from a mid-month dip following the May 7 sUSDe maturity expiry. Pendle TVL stabilized at approximately $230-240M after the May 6 sUSDe maturity expiry. Morpho TVL held in the $185-250M range.
Protocol & Risk Metrics
Supply and Yield
USDe: Supply closed May at $4.51B, up from $3.90B at end April, a 15.6% recovery. Growth was steady throughout the month, with a notable acceleration around May 13-14 coinciding with the Jupiter Lend institutional launch. This is the first meaningful supply recovery since the April rsETH driven contraction from $5.9B.
sUSDe: Total staked USDe ended May at $1.794B, a staking ratio of 39.74%, down from 44.0% at end April. The ratio declined as the supply denominator expanded through new minting while the absolute staked balance fell, reflecting lower opportunity cost of unstaking under the active 1-day dynamic cooldown.
Protocol Yield: The sUSDe 30-day moving average APY held near 4.0% for most of May. With liquid cash at approximately 89% of backing, sUSDe yield is primarily a function of DeFi lending rates across Aave, Morpho, Kamino, and Jupiter Lend. BTC and ETH basis trading positions ($391M combined, 9% of backing) contribute a secondary yield component through perpetual funding rates.
Source: Blockworks Ethena Dashboard, Overview, May 30th, 2026
Source: Blockworks Ethena Dashboard, sUSDe, May 30th, 2026
Source: Blockworks Ethena Dashboard, sUSDe, May 30th, 2026
Source: Blockworks Ethena Dashboard, sUSDe, May 30th, 2026
Liquidity & Redemptions
USDe DEX liquidity ranged between approximately $115M and $150M across May, peaking around May 13-15 coinciding with elevated mint activity. Curve on Ethereum was the dominant venue at approximately $55M, followed by Fluid on Ethereum. The mint/redemption contract held consistently at approximately $93-94M across USDT, USDC, and USDtb in roughly equal proportions, absorbing large mid-month USDT and USDC mint flows and a material USDtb redemption at month-end without peg stress.
Source: Blockworks Ethena Dashboard, USDe, May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe, May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Risk & Resilience Metrics
Solvency: The protocol backing ratio is 101.51%, with $4.57B in backing assets against $4.51B in outstanding USDe supply.
Reserve Fund: The Reserve Fund balance is $62.5M, representing a coverage ratio of 1.387% of USDe supply. The Risk Committee’s current recommended minimum is $2.84M, making the fund approximately 22 times overcapitalized. No Reserve Fund accruals are occurring; future USDtb interest income is being redirected to sUSDe stakers per the April subcommittee recommendation.
Collateral Composition: As of May 31, total backing is $4.5B: approximately $4.0B in liquid cash (89%) and $391M in basis trading positions comprising $297M BTC and $94M ETH (9% combined). The remaining 2% consists of BNB, liquidity provision allocations, and other minor positions. The liquid cash component is the primary yield generating segment; the basis trading book contributes a secondary yield stream through BTC and ETH perpetual funding rates.
Exchange Venue Mix: For delta neutral positions, Binance is the dominant venue at approximately 70-75% of exchange exposure, Bybit approximately 20%, OKX approximately 5%, and Deribit approximately 2-3%. A notable intra month shift occurred between approximately May 9 and May 16, during which Bybit’s share temporarily expanded to approximately 80% before normalizing, reflecting position rebalancing during the supply expansion.
Liquid Cash Breakdown: Within the $4.0B liquid cash component, stables deployed in DeFi lending markets (Aave, Morpho, Kamino, Jupiter Lend) are the largest category at approximately 45-48%, followed by blue chip stables at approximately 25-28% and USDtb at approximately 15-17%. Under the dynamic cooldown framework, assets settle across three tiers: Tier 1 (1-day settlement) comprises blue chip stables, the mint/redeem buffer, and 1% of USDtb supply, representing approximately 30% of liquid cash (~$1.2B). Tier 2 (2-day settlement) comprises 99% of USDtb supply and withdrawable lending positions, representing approximately 30%. Tier 3 (5-day settlement) comprises utilization constrained lending positions, representing approximately 40%. The DeFi lending allocation spans Tier 2 and Tier 3 depending on real time utilization conditions across each venue. Tier 1 is not the dominant tier by asset share; the lending book collectively holds most liquid cash and generates the majority of protocol yield.
Cooldown Framework: The dynamic cooldown remains set at 1 day. The 1-day setting is maintained not because Tier 1 assets dominate backing but because Tier 1 in absolute terms ($1.2B) provides 4-5 times coverage of the P99 historical worst case daily redemption benchmark, above the 1.5x safety floor required for the 1-day setting. The daily Tier 1 redemption cap ranged between approximately $600M and $900M across May. The cooldown stress endurance metric confirms Tier 1 liquidity alone sustains at least 3 days of maximum stress outflows before the 1x safety floor is breached.
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Source: Blockworks Ethena Dashboard, USDe (Risk), May 30th, 2026
Ecosystem Expansion & Integrations
- Grayscale DeFi Fund: added ENA at a 13.59% allocation, the first major US institutional fund to include ENA.
- On-chain activity surge: Ethena recorded its largest single day (May 12) network growth in over three months, with whale transactions at a five week high and new wallet creation at its strongest level in over three months.
- Jupiter Lend dedicated market: Ethena launched a fully isolated market on Jupiter Lend, curated by Bitwise to bring institutional grade asset management and risk oversight. Jupiter Lend had grown into one of the largest lending venues on Solana within months of its own launch.
- Kamino dedicated market: A dedicated Ethena market went live on Kamino with an accompanying vault in partnership with Sentora. Together with the Jupiter Lend integration, USDe denominated activity arrived on Solana DeFi at scale for the first time.
- ENA on Solana: ENA launched on Solana via Sunrise DeFi, expanding multichain access to the governance token.
- Solana markets cross $1B: The combined Ethena markets on Jupiter Lend and Kamino surpassed $1B in TVL within days of launch, confirming rapid adoption of USDe denominated activity on Solana.
- Backing transparency update: Ethena updated its transparency page to show a more detailed breakdown of USDe reserves, reflecting the diversification of backing. Assets will continue to be added as new allocations are proposed and approved by the Risk Committee.
- LayerZero volume milestone: USDe surpassed $20B in cumulative cross chain transfer volume on LayerZero. Lifetime volume across all Ethena assets on LayerZero exceeded $30B, contributing to over $265B in total value transferred across the LayerZero network.
Collateral & DeFi Footprint
Ethena assets continue to serve as major collateral across lending and yield markets.
Aave Markets
Ethena related TVL on Aave started May at approximately $540-560M, inclusive of the PT-sUSDe-7MAY2026 position. TVL dipped to approximately $420-440M in the first week of May following the PT maturity on May 7, before recovering as USDe direct supply grew from approximately $220M to $340M and sUSDe collateral expanded. The month end total reached approximately $580-600M.
Source: Blockworks Ethena Dashboard, DeFi Footprint, May 30th, 2026
Pendle Markets
Ethena related TVL on Pendle fell from approximately $540M at month start to approximately $230-240M by May 8 following the expiry of the sUSDe 06 May 2026 maturity, then held stable for the remainder of the month. The dominant active market is sUSDe 18 Jun 2026.
Source: Blockworks Ethena Dashboard, DeFi Footprint, May 30th, 2026
Morpho
Ethena related TVL on Morpho declined from approximately $250M at month start to approximately $185-190M by mid-month, with a partial recovery toward month end. sUSDe remains the dominant collateral asset.
Source: Blockworks Ethena Dashboard, DeFi Footprint, May 30th, 2026
Whitelabel Stablecoins
Total Whitelabel supply (jupUSD, USDm, suiUSDe) contracted from approximately $560M at month start to approximately $300M by month end. USDm (MegaETH) accounts for most of the decline as its initial growth phase moderated. jupUSD held broadly flat at approximately $40M. The $300M month end total remains well above the $100M milestone first reached in February 2026.
Source: Blockworks Ethena Dashboard, Overview, May 30th, 2026
Governance Activity
The Risk Committee published three new backing asset proposals in May, alongside material progress on the Solana lending expansion.
- USDG as a USDe Backing Asset: LlamaRisk supports onboarding USDG as a USDe backing asset and Reserve Fund eligible asset. As of March 30, 2026, USDG circulating supply was approximately $1.70B. USDG is regulated under MAS (Singapore), MiCA (EU), and the GENIUS Act (US), attested monthly by KPMG LLP since February 2026. LlamaRisk recommends a phased allocation, monitoring redemption performance, onchain liquidity depth, and smart contract timelock implementation.
- Lending USDe Backing Assets into Kamino and Jupiter on Solana: Kairos Research provisionally supports isolated lending instances for Ethena on both Kamino Finance and Jupiter Lend on Solana, subject to parameter conditions. The proposal is directly connected to the Jupiter Lend and Bitwise institutional launch (May 13). By month end, Kamino and Jupiter Lend collectively represented approximately 20-30% of lending market deposits, with Aave’s share declining from approximately 80% to approximately 60%.
- Ripple USD (RLUSD) as a USDe Backing Asset: Blockworks Advisory published an eligibility assessment of RLUSD, issued by Standard Custody & Trust Company LLC (a Ripple Labs subsidiary) under NYDFS regulation. As of March 13, 2026, RLUSD circulating supply was approximately $1.56B across Ethereum and the XRP Ledger. The assessment evaluates reserve composition, peg stability and suitability for inclusion within the Ethena liquid stables backing portfolio.
Monthly Revenue
Total protocol gross fee income in May was approximately $16.5M, a decline from April’s $22M. With liquid cash at 89% of backing, protocol revenue is primarily driven by DeFi lending rates across Aave, Morpho, Kamino, and Jupiter Lend. USDtb interest income held approximately steady at $2.4M. Mint fees rose to approximately $0.9M (approximately 5-6% of gross revenue), elevated by large institutional mint flows during mid May. Fee allocation in May: sUSDe staking yield approximately 44%, partner rewards approximately 38%, Aave liquid leverage program approximately 18%. Partner reward share has risen from approximately 27.9% in January/February, reflecting the expanded distribution network.
Source: Blockworks Ethena Dashboard, Financials, May 30th, 2026
Source: Blockworks Ethena Dashboard, Financials, May 30th, 2026
Source: Blockworks Ethena Dashboard, Financials, May 30th, 2026
Source: Blockworks Ethena Dashboard, Financials, May 30th, 2026