USDe differs from stablecoins such Circle's USDC because it's a synthetic stablecoin and not backed by fiat assets at a 1:1 ratio. The stablecoin maintains its $1 peg by collateralizing stablecoins and leveraging a hedged cash-and-carry trade, which involves taking futures positions with large open interest available to stabilize value.
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USDe maintains its peg to fiat currency by hedging against the price drop of it’s crypt assets reserves by selling corresponding futures
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USDe stablecoin, in contrast to traditional stablecoins, which are backed by fiat currencies, is backed by digital assets, including other stablecoins
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