Ethena flags potential security incident involving Binance, says collateral sits off-exchange

The USDe issuer says exchange-exposed collateral is held with off-exchange custodians rather than on Binance itself Ethena Labs, the team behind the synthetic dollar USDe, said it is aware of a potential security incident involving Binance. The alert came on October 29, 2026. Ethena said its exchange-exposed collateral is kept with off-exchange custodians, not parked on the exchange itself. Neither the nature nor the scope of the possible incident at Binance has been disclosed. Ethena’s message focused on where its money is. What Ethena said, and what it means for USDe Ethena indicated that USDe’s core functions remain unaffected. That covers minting, redemption and the collateral backing the token. The company works with Off-Exchange Settlement providers, known as OES, including Copper and Ceffu. These custodians hold and manage USDe’s backing assets without handing ownership over to the exchange. The exchange gets to see the collateral and extend trading credit against it. It does not get to hold the keys. Why Ethena touches exchanges at all USDe is not backed by dollars in a bank account. It maintains its value through delta-neutral hedging, mostly using perpetual futures on cen...