Following shockwaves in the cryptocurrency market, the USDE token in the Ethena ecosystem lost its $1 peg. The DEPEG incident occurred shortly after Donald Trump announced he would impose 100% tariffs on China. Ethena stated that USDE is experiencing volatility in the secondary market due to sudden market fluctuations and widespread liquidations. The protocol asserted that its minting and redemption functions are functioning smoothly and that USDE remains overcollateralized. The statement noted that futures contracts were trading below spot prices due to liquidations, leading to unexpected impacts on USDE's realized profits. Ethena stated that it would benefit the protocol by realizing these positions. As a result, the events reportedly left USDE more collateralized than the previous day. The protocol stated that it will share updates as developments unfold. *This is not investment advice.