Ethena Pay, the consumer payments application of the Ethena ecosystem, has launched Earn+, a new yield vault that advertises returns of up to 12% APY while looping USDe and USDT at roughly 11 times leverage. Announced on Oct. 28 via the official Ethena Pay blog, the product uses USDe as collateral and borrows USDT against it, and its design carries risks that may not be visible in the reported numbers.

The vault strategy is managed by Upshift and Steakhouse through Aave v4 on Avalanche, with Ethena Pay providing the front-end application that users see. The leverage comes from looping — supplying collateral, borrowing against it, and converting the borrowed funds into additional collateral — a long-standing DeFi technique whose defining feature is that it magnifies both sides of the trade at once: the advertised yield and the position's sensitivity to the collateral's price.

The Price Feed Follows a Different Token

Lending platforms use price feeds, known as oracles, to value collateral and debt, and Aave relies on these prices to measure how close a position is to being liquidated. In an Oct. 20 technical review, Aave Labs said the USDe price feed on Avalanche follows USDT, noting that this setup would fail to detect a drop in USDe's price that does not affect USDT.

The feed uses a Chainlink USDT/USD price with a $1.04 upper cap. If USDe slips while USDT holds steady, the vault could appear healthy while users lose real value.

LlamaRisk, in a recommendation amended Oct. 19, proposed a 93% collateral factor for USDe. The exact vault account, its current balances, and its live oracle setup have not been verified.

CryptoSlate modeled a hypothetical position at 11 times leverage, in which $100 of equity supports 1,100 USDe against 1,000 USDT of debt. In that example, if USDe falls to $0.99, equity drops 11%; at $0.98, the loss reaches 22%; and at $0.95, it climbs to 55% — all before fees and costs. Put differently, a 2% USDe discount at 11x leverage would erase 22% of a user's starting equity before costs.

Onchain analyst Utkarsh, who posts as 0xAnon, traced the source of the vault's yield in an X post on Oct. 28:

1/ @EthenaPay new Earn+ pays up to 12% on dollars I traced where that yield comes from onchain pic.twitter.com/UjrEHjmlWu

— Utkarsh | 0xAnon (@0xAnon0602) October 28, 2026

Borrowing Costs, Fees and Withdrawals

Because debt equals ten times the starting equity, borrowing costs are a material factor. A 1% increase in the yearly USDT borrow rate would cut simple annual returns on equity by about 10%, and interest also builds into the debt over time, which can lower a position's health. Aave Labs noted that plain USDe does not earn yield on its own, unlike staked sUSDe (USDe is Ethena's synthetic dollar, while sUSDe is its staked, yield-bearing counterpart).

Ethena Pay waives its own entry and exit fees. However, Upshift's documents allow for management fees, performance fees, and a fee for instant redemption, and a fee schedule specific to Earn+ has not been confirmed.

Upshift's risk rules let an owner multisig pause withdrawals and trigger emergency withdrawals. Its redemption system includes a standard batch queue and an instant option funded by a cash buffer.

Ethena caps total Earn+ deposits at $4.5 million. Individual limits are set at $20,000 for Standard users, $50,000 for Pro users, and $200,000 for VIP users. Ethena Pay as a whole holds more than $8 million in USDe and counts about 1,400 active users, with the app live in 47 countries; the US, EU, and UK are listed as coming soon. That distribution is part of what makes the mechanics above relevant beyond protocol specialists: Earn+ delivers a leveraged lending position through a consumer payments interface, where it appears as an advertised APY rather than as a set of oracle, collateral-factor, and fee parameters.

Withdrawal requests can be made at any time and, according to Ethena Pay, are processed within 24 hours, though its FAQ warns that some withdrawals can take longer. The near-term items to watch are concrete: verification of the exact vault account, its balances, and its live oracle setup, confirmation of an Earn+ fee schedule, and the app's pending rollout to the US, EU, and UK.

Source: Blockonomi