Master stablecoin spread arbitrage on Bybit using USDe & USDtb. Learn how to earn high yields via low-risk leveraged crypto trading strategies.

 have been an essential part of the cryptosphere for more than a decade. Backed by collateral or 

 mechanisms and pegged to an established traditional finance asset, often the US dollar, they offer rate stability in the turbulent world of cryptocurrency. Traditional stablecoins, however, don’t generate yields. Their real value erodes over time due to inflation. 

 have entered the market in recent years to combat this issue.

Yield-bearing stablecoins feature an operational mechanism that allows them to stay pegged to a traditional asset and generate returns on the principal amount. This enables crypto investors to enjoy low-risk returns on their investments.

The yield-bearing nature of these assets also opens up a way to optimize their returns via spread arbitrage, particularly the leveraged version.

In its most basic form, leveraged spread arbitrage allows you to profit from the difference in borrowing and earning interest rates. Bybit offers a great way to earn higher stablecoin yields using this technique. You can borrow funds at lower interest through the margin trading option in your account by using your 

 principal and invest the borrowed amounts for interest in USDe or USDtb, two yield-bearing stablecoins offered by one of the leading 

What are USDe and USDtb, and why do they offer high yields?

The Ethena protocol is among the leading providers of yield-bearing stablecoins in the crypto market. The project’s first and best-known stablecoin, 

, is an algorithmic crypto pegged to USD that uses 

 contracts, to generate yield. ENA calls USDe a synthetic dollar. Thanks to its yield-bearing properties, USDe has been a tremendous market success. As of late May 2025, it ranks fourth among all stablecoins by 

Following the success of USDe, ENA launched 

, another dollar-pegged yield-bearing stablecoin. Unlike USDe, USDtb isn’t based on algorithmic trading strategies. Instead, it is indirectly backed by high-grade, low-risk traditional assets. USDtb is directly based on 

 (BUIDL), which invests in US treasury bills, repurchase agreements and other cash equivalents. As BUIDL generates yield from these assets, it flows over to USDtb, delivering low-risk, institutional-grade returns for the stablecoin’s holders.

While USDe and USDtb feature different models for generating returns — the former via active decentralized trading strategies and the latter via the backing of traditional assets — they are both known as yield-bearing assets. Their typical annual yields range from around 4% to 15%, depending on market conditions.

Spread arbitrage opportunity through interest rate gaps

Spread arbitrage is a trading technique that allows you to earn returns using the difference between borrowing and investing interest rates.

Using spread arbitrage at the most basic level involves borrowing funds at X% APR and investing them in a financial product that generates Y% APR. You earn a profit when Y is larger than X.

USDe and USDtb offer healthy yield opportunities and, under favorable market conditions, can generate yields that may exceed borrowing rates for assets like USDT and USDC. This creates opportunities for spread arbitrage using a combination of these stablecoins.

For instance, you may borrow USDT/USDC for 

 (UTA). You can then buy USDe/USDtb with your borrowed funds to enjoy a potential rate difference between their yields and the interest you pay on your borrowed USDT/USDC. Bybit regularly offers campaigns based on zero fees for swaps between key stablecoin pairs, potentially making your entire spread arbitrage process even more cost-efficient.

An example of a simple version of spread arbitrage involves swapping your USDT/USDC funds to USDe and earning stable returns. This scenario assumes no leverage and, therefore, no borrowing interest to pay. While this is a great way to earn low-risk returns from USDe, it doesn’t maximize the spread arbitrage strategy’s potential.

A more advanced version that delivers potentially higher returns is via the use of leverage. This involves borrowing funds in USDT, or preferably in USDC, which usually features lower borrowing interest, and investing the borrowed funds along with your own principal in USDe to boost the total yield from the stablecoin. For instance, if the USDC borrow rate is 4% and USDe’s APR is 5%, the difference in the rates, 1%, represents your profit.

Let’s review a typical example of how you can benefit from leveraged spread arbitrage, assuming your initial capital is 1,000 USDT and the leverage ratio is 6x.

You start with 1,000 USDT of your own crypto funds.

You then borrow 5,000 USDT, using your 1,000 USDT as collateral. This gives you 6,000 USDT of total capital to use for your spread arbitrage trading.

You take the 6,000 USDT and convert it to USDe. For example, let’s assume that you can earn a USDe yield of 5% annually from the stablecoin — a relatively conservative estimate. 

 USDe on ENA may deliver much higher returns depending on market conditions and the protocol’s performance (USDe’s yield rate as of late May 2025 is 6.2%). Let’s also assume that your borrowed USDT has an interest rate of 4%.

With the assumed yield from USDe of 5%, you earn:

Assuming the 4% interest rate on USDT, you must pay:

Performing spread arbitrage using USDe/USDtb on Bybit gives you multiple benefits:

1. Open a UTA account (if you don’t already have one) and enable margin trading for USDe/USDtb, USDT and USDC.

Set USDe/USDtb, USDT and USDC as collateral.

For the website version, here are the relevant screenshots.

If you use the Bybit mobile app, refer to the screenshots below.

, set 10x leverage, execute a trade to sell 4,000 USDT, or whatever amount you prefer to allocate to spread arbitrage, and borrow 4,000 USDC.

Use the borrowed USDC to buy USDe. Since Bybit offers you a way to earn interest on USDe on the platform, simply hold the borrowed funds in your UTA account to start earning yield.

Track your yields and repayments to see how your spread arbitrage is performing.

If you decide to stop using spread arbitrage, simply sell USDe and repay USDC.

Naturally, just like any other trading strategy, spread arbitrage using stablecoins involves certain risks.

One is the depegging risk. If USDe falls below $1, you may incur magnified losses. For example, with a 5x leverage, a 1% drop in the stablecoin’s rate will result in a 5% total loss.

 is the second type of risk. If yields from USDe drop below the borrowing costs, the entire spread arbitrage strategy will result in a net loss.

Leveraged spread arbitrage using stablecoins is a great way to earn returns with manageable risk. It may be suitable for users comfortable and familiar with the use of margin; traders looking for alternatives to earning yield from staking, 

 and similar DeFi strategies; and those who prefer more passive ways to generate yield from their funds.

However, this strategy is not particularly suitable for beginners, users not comfortable with leverage trading or those skeptical of synthetic stablecoins.

The spread arbitrage strategy described above, along with the examples, does not constitute financial advice. Before applying this strategy in any form, 

Intermediate

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High-yield stablecoin strategy: Mastering USDe/USDtb spread arbitrage on Bybit

This is a thought leadership article written by Mazurka Zeng, Head of Fiat at Bybit.

This post is written by Mazurka Zeng. Mazurka is the Head of Fiat at Bybit.

Stablecoins have become a cornerstone of the digital asset ecosystem, providing a crucial bridge between fiat currencies and the crypto world. 

As Head of Fiat at Bybit, I've seen firsthand how user needs are diversifying, pushing innovation beyond traditional fiat-pegged stablecoins.

Exponential growth in the stablecoin sector

The stablecoin sector is maturing, driven by increasing adoption and regulatory progress, like the 

 the US House Financial Services Committee, with the GENIUS Act 

 to final passage by the US Senate on May 20.

In my role overseeing Bybit's fiat operations, we've integrated stablecoins deeply into our ecosystem. They enable seamless transactions on the 

 platform. Further, they provide yield in 

 and facilitate seamless spending via the 

. This expanding utility fuels the need for a broader range of stable assets.

This growth is undeniable. The market capitalization of fiat-backed stablecoins surged to an all-time high market cap of $248 billion by May 22, 

 with a $151.9 billion market cap, even as it is facing MiCA compliance hurdles in Europe. This dominance, however, prompts a vital question: 

What's next for stablecoins beyond the established fiat-backed giants?

One compelling alternative that is gaining traction is 

. Unlike fiat-backed stablecoins, XAUT is pegged 1:1 to one fine troy ounce of physical gold, securely stored in Swiss vaults and meeting the LBMA Good Delivery standard. This offers users direct digital ownership of gold, combining its historical stability with blockchain efficiency.

Gold has long been valued as an inflation hedge. In 2025, amid ongoing economic uncertainty and geopolitical tensions, XAUT saw significant interest, reflected in its 25% year-to-date price surge. Furthermore, XAUT solves the traditional challenges of physical gold ownership — storage costs and accessibility issues. It allows for fractional ownership (down to 0.000001 troy ounce) and easy, borderless transfers, 24/7.

 markets. The strong user interest confirms a clear appetite for stablecoins backed by tangible, non-fiat reserves, especially during times of market volatility.

Another exciting development is the rise of regionally focused, MiCA-compliant stablecoins. In March 2025, Bybit.NL 

, issued by Quantoz Payments and StablR Limited, respectively. Both are fully backed by fiat reserves (USD) and designed explicitly to meet the EU's rigorous MiCA regulations, offering enhanced transparency and user protection within the European Economic Area (EEA).

, based in Malta, have both secured investment from Tether. Significantly, both issuers leverage Tether's new 

, designed to streamline the issuance and management of regulated digital assets. This backing signals strong confidence in these newcomers and their potential to foster compliant stablecoin adoption in Europe.

The stablecoin market is clearly diversifying. Gold-backed options like XAUT could increasingly appeal to those seeking stores of value outside the traditional USD-dominated financial system. Their stability profile offers a different kind of hedge compared to fiat-pegged tokens.

Simultaneously, MiCA-compliant, locally issued stablecoins like USDQ and USDR are poised to bridge traditional finance and crypto within Europe more effectively. Their regulatory clarity may foster greater trust among users and institutions, facilitating seamless digital euro and dollar transactions across the region.

At Bybit, our focus remains on empowering users. We're committed to providing a wide array of stablecoin options — from established leaders to innovative newcomers like XAUT, USDQ and USDR. By offering diverse assets and supporting regional compliance efforts, we aim to provide the tools users need to navigate the evolving digital economy confidently.

In a world where trust and flexibility are key, stablecoins must do more than just hold value — they must create value. At Bybit, we’re proud to be shaping that future.

Beginner

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Stablecoins beyond USDT: Exploring the potential of XAUT and newcomers USDQ & USDR

Elon Musk confirmed that X Money, a peer-to-peer payments feature for the X platform, will launch soon in a limited beta.

The S&P 500 rebounded in futures trading after Trump delayed a 50% EU tariff to July 9, easing trade tensions. Gold rose 0.08% to $3,317 per ounce on Tuesday, supported by a 0.20% drop in the US dollar and concerns over the growing US fiscal deficit. Gains were capped by weak domestic demand. The Coindesk Indices, which tracks the broader crypto market, fell 1.13%, with Bitcoin up 1.28% and Ether down 0.51%, in the past 24 hours. Trade these markets and more with up to 500x leverage on Bybit MT5 using this 

Today’s top performer is KAITO, up 7.2% after Huma Finance launched the $HUMA airdrop and staking program for Kaito ecosystem participants.

Kaito (KAITO), founded in 2022, is a $1,099/month AI-powered crypto search engine that aggregates data from web3 sources like Twitter, Discord, and forums, using advanced AI to deliver context-rich, sentiment-filtered insights. Huma Finance has 

 the $HUMA claim for top Kaito AI yappers and active ecosystem users, distributing 10bps of supply to each group. Eligibility requires past engagement and specific holdings, like 100+ sKAITO or YT KAITO. Staking is also live, offering rewards, feathers, and Vanguard status for long-term holders, with no lockup. Season 1 and 2 will distribute additional rewards over the next 3–6 months.

Check out the latest prices, charts, and data of 

, a peer-to-peer payments feature for the X platform, will launch soon in a limited beta. While it will allow debit card-linked transactions via Visa, there’s still no mention of crypto support—disappointing Dogecoin fans. Musk emphasized caution due to the involvement of users' savings.

With markets closed for Memorial Day on May 26, Bitcoin spot ETFs recorded no activity. 

, allocating 10bps to the top ~500 Kaito yappers and 10bps to active users in the Kaito ecosystem. Eligibility requires holding 100+ sKAITO or YT KAITO and a linked SOL wallet. Two more drops are planned in Seasons 1 and 2, with rewards increasing to 12.5bps for yappers and 2.5bps for the ecosystem, plus extra for those staking $HUMA and $KAITO.

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Elon Musk confirms X Money beta launch

Explore key similarities and differences in using technical analysis (TA) for stocks vs. crypto, and how to adapt popular indicators for crypto trading.

 (TA) is a significant component of modern trading. The term refers to a body of analysis methods and indicators used to forecast future market movements based on past price and volume data.

In the stock market, TA indicators like support and resistance levels, Bollinger Bands, chart patterns and moving averages have been used successfully for decades. Many crypto traders apply the same TA methods to predict the prices of cryptocurrencies. However, due to the inherent differences between stocks and crypto, applying these methods to crypto trade directly may not be as straightforward as it seems.

In this article, we’ll explore which common TA indicators might work for crypto, at least with certain adjustments, and which might mislead you when applied in the unique world of cryptocurrency.

 are among the key concepts in TA. A support level is a price point at which a downtrend is widely expected to halt, while a resistance level is a price point at which an asset’s uptrend is expected to fizzle out. Traders expend considerable effort to identify likely support and resistance levels for a stock or cryptocurrency, considering factors like the asset’s overbought and oversold indicators, orders clustered around a certain price level, previous highs and lows, institutional buying behavior and more.

In both the equities and crypto markets, support and resistance levels can provide valuable insights. These levels are often more predictable in the stock market thanks to its more established nature, higher liquidity and strong institutional participation. On the other hand, the crypto market’s 

, whale activity, lower liquidity and susceptibility to news and online hype can make estimated support and resistance levels less certain. This is particularly the case with lower-cap altcoins, whereas support and resistance levels are more clear-cut for the top assets, such as 

Despite the lower certainty of support and resistance in crypto trade, both markets conform to the general rules of estimating these levels since they are driven by basic human psychology.

For instance, the round-number bias is a significant determinant of support and resistance. It manifests itself in clear support and resistance points around round numbers, e.g., $70,000 for BTC. Since many investors, particularly less experienced retail players, often think in terms of round numbers — e.g., I’ll buy this asset when it hits $70,000 — there tends to be clear order clustering around these points. The flurry of orders at or very near round numbers tends to provide support or resistance to the price.

Although support and resistance levels apply to both stocks and crypto, use them more cautiously in crypto as they are less certain. Treat these levels for cryptocurrency TA more like support and resistance zones than precise point estimates. 

 is a major TA indicator represented by a trio of bands plotted on the price chart. The middle band shows the asset’s 20-period moving average (MA), while the upper and lower bands represent two standard deviations above and below the MA, respectively.

In both the stock and crypto markets, Bollinger Bands can inform the trader of several things. For instance, band squeezes may indicate periods of reduced volatility. According to the indicator’s inventor, John Bollinger, these periods are often followed by increased volatility, so a squeeze may signal an upcoming increase in market turbulence. This use of Bollinger Bands is highly applicable in both the stock and crypto markets, as they both have volatility cycles.

Another common use of the bands in both markets is estimating the likelihood of trend continuation. When the price breaks out of the upper or lower band, it signals that the uptrend or downtrend, respectively, will continue. However, the crypto market is more prone to false breakouts, particularly during periods of low volatility and significant whale trading activity.

Large players — institutional investors in equities and whales in crypto — often employ volume-based strategies. These can be analyzed using TA tools like 

 (VWAP) and various volume profile indicators.

VWAP shows the average price ratio to the asset’s total trading volume. Volume profiles are a family of TA indicators that typically show trading volume distributions across price levels.

Large-cap cryptocurrencies and stocks often demonstrate similarities when analyzed using volume-based indicators. For example, a crypto like Bitcoin and a stock like Apple (AAPL) might consolidate near their VWAP. Also, a breakout above VWAP and an increasing volume of trade may signal bullish whale or institutional activity and the continuation of the uptrend.

Chart patterns (head and shoulders, triangles, etc.)

TA patterns are visual formations in price charts that reflect trader psychology and help predict potential future price movements based on historical behavior. Many patterns are used to indicate trend reversals or continuation, as are bilateral patterns, which suggest price movements in either direction. Below are the popular or common patterns:

Bear in mind that the same pattern may be interpreted as either a reversal/continuation or a bilateral signal depending on contextual factors like volume activity and volatility.

High and well-structured institutional activity in the stock market makes patterns more likely to be completed. In contrast, patterns may often fail in the crypto market due to the effects of news and online hype, whale manipulation, lower liquidity, trading bots exploiting patterns early and the lack of defined institutional activity. Therefore, crypto traders are advised to wait for patterns to be confirmed in the expected direction and use supporting signals like volume data and other TA indicators.

 is a TA indicator that shows the average price over a set number of past periods. Its most basic form, the 

(SMA), is based on unweighted averaging of the past periods.

Traders use several more advanced averages — the 

 (EMA) is probably the most common. EMA is based on a weighting procedure that gives more weight to more recent data periods.

In the stock market, the 50-day and 200-day MAs are reasonably reliable trend indicators. Institutional and retail investors respect these indicators, using them to estimate trends and plan their moves. However, the MAs in crypto are often much less reliable due to factors like higher volatility, lower liquidity, more emotion- and hype-driven retail traders, lower institutional activity and the prevalence of short-term high-risk strategy followers. As a result, prices in crypto might move violently well outside of MAs, sometimes multiple times in a single day.

MAs may still provide sound signals to crypto traders, but they must be used with specific adjustments. Treating MAs in crypto as general support and resistance zones is advisable, as is employing higher time frames (e.g., daily or weekly) for better accuracy.

 (RSI) is a primary TA indicator used to assess whether an asset is overbought or oversold.

The RSI value oscillates between 0 and 100 — below 30 indicates an oversold asset and above 70 signals excessive buyer activity.

RSI works reasonably well in the stock market, particularly for large-cap, high-volume stocks, but the applicability of this indicator in the crypto market is less certain.

It’s not unusual for a cryptocurrency RSI to stay in an overbought or oversold territory for extended periods. For instance, a hype-driven altcoin may remain above 70 RSI for a long time, getting pumped and promoted continuously, attracting more and more gigaprofit-chasing individual traders.

Therefore, if you plan to use RSI for crypto trading, be sure to verify its signals using other indicators and consider the broader context.

Using established TA methods may significantly enhance your crypto trading. However, not all methods are highly applicable to the cryptocurrency market.

While you may be able to use support and resistance levels, Bollinger Bands, and volume-based indicators successfully in crypto with certain adaptations, chart patterns, MAs and RSI require more substantial adjustments. You might even omit them from your active analysis toolbox. In any case, combining multiple indicators and using other contextual data to inform your trading moves is always advisable.

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Technical analysis in stocks vs. crypto: Key similarities and differences

Bybit Learn

Stablecoin

There are a total of five ways you can buy USDC on Bybit: via Bybit P2P, Bybit One-Click Buy, Auto-Invest, Bybit Card and Bybit Convert. Learn more here.

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 that maintains a 1:1 value with the US dollar through full reserves held in regulated financial institutions. This stability makes USDC an attractive option for traders looking to participate in the crypto market with reduced price volatility.

In this guide, we’ll explore the multiple ways to buy USDC on Bybit, detailing five distinct purchasing methods tailored to different preferences. You'll also discover practical applications for your USDC holdings, from trading opportunities to payment solutions and investment strategies.

Whether you prefer trading directly with other users or making quick purchases with a credit card, there's an option for you. Let's examine each method in detail.

 allows individuals and businesses to buy and sell USDC via peer-to-peer mode without intermediaries. You simply transact with another trader to purchase or sell your crypto with zero fees.

There are two main parties on the P2P platform — makers and takers. Makers place ads for buying or selling cryptocurrency, while takers are the users who place orders through the existing ads created by makers. Neither makers nor takers pay any fees on completed orders.

If you decide to go the P2P route to buy your USDC, you can either place a buy ad as a maker, or select an existing offer as a taker. Placing ads is completely free, although specific trading activity requirements exist. If you're a beginning trader on the platform, and want the easiest way to purchase USDC, selecting an offer from an existing ad as a taker is probably the preferred route.

If you need to trade USDC in large volumes (typically tens or hundreds of thousands of USDC per transaction), you may also choose to consider 

, which offers high order limits — up to $200,000 per order — as well as expedited transaction processing.

 feature to complete your USDC order efficiently. HotSwap combines offers from P2P traders with liquidity options from third parties, potentially delivering more choices and options.

Steps for buying USDC via the standard P2P option

2. How to buy USDC via Bybit One-Click Buy

The One-Click Buy service lets you quickly purchase crypto using several supported payment modes: P2P, bank card payments, third-party payments and your account's fiat balance. You can use a credit or debit card (including the Mastercard-powered 

), bank transfers, Apple Pay, Google Pay and other payment methods.

 is another way to purchase USDC on Bybit. The Auto-Invest option allows you to automatically buy crypto at regular intervals using the popular 

Bybit Card is a Mastercard crypto debit card that allows you to make online payments. The card is available to users in specific regions — EEA and CH, AIFC, Australia, Brazil and Argentina — with more locations to be added in the future. It's accepted by more than 90 million merchants within the Mastercard network. Upon successfully applying for your Bybit Card, you may proceed to 

 while you order and wait for your physical card to arrive. 

It's easy to buy USDC using the Bybit Card, as you enjoy reward features like loyalty points and cashback for USDC transactions. The steps for buying USDC using the Bybit Card are nearly the same as shown above in the One-Click Buy section, the only difference being that you'll need to specify your Bybit Card as the preferred payment method.

 lets you easily swap crypto assets without directly trading through the P2P route or other channels. Using Bybit's order books, the platform matches your order with current suitable orders and executes the requested swap. By leveraging Bybit's vast trading volumes and activity, Bybit Convert enables swift and efficient swaps.

If you have non-USDC crypto funds in your account, you can take advantage of the 

 function to buy the stablecoin as follows:

Steps to for buying USDC via Bybit Convert

USDC is more than just a stablecoin for trading; it offers various applications within and beyond the Bybit ecosystem.

USDC serves as a reliable base currency for trading various cryptocurrencies on Bybit.

Trading with USDC helps mitigate volatility risks between trades, as its value remains stable at approximately $1, allowing traders to preserve capital during market downturns.

USDC has emerged as a popular payment method due to its stability and wide acceptance.

Platforms on which users can make USDC payments include Travala for travel bookings, Newegg for electronics, and various crypto-friendly merchants via payment processors, such as BitPay and Coinbase Commerce.

USDC offers various investment opportunities on Bybit and beyond.

The benefit of investing with USDC is that your principal amount remains stable while generating returns, which is particularly attractive in volatile market conditions.

USDC combines dollar stability with digital efficiency on the Bybit platform. This guide has detailed five ways to purchase USDC, and explored its versatile applications for trading, payments and investing. Armed with this knowledge, you can confidently navigate Bybit's ecosystem and make the most of what USDC has to offer.

A complete guide on how to buy USDC on Bybit

Compete for 2,500 USDT USDT Every Week

A complete guide on how to buy USDC on Bybit

Grab Up to 5,000 USDT in Rewards

Compete for 2,500 USDT USDT Every Week

Grab Up to 5,000 USDT in Rewards