Ethena Founder Guy Young: Decoding the New Landscape of the Stablecoin Market

Recently, Ethena's USDe stablecoin has attracted widespread attention, with its market value skyrocketing from $140 million to $7.2 billion within a year, an increase of over 50 times. After the relevant legislation was passed, Ethena quickly partnered with a federal regulated crypto bank in the United States to launch the compliant stablecoin USDtb. At the same time, Ethena initiated a large-scale financing and buyback plan, sparking heated discussions in the market.

Recently, Ethena founder Guy Young gave a podcast interview, sharing the reasons behind the company's rapid rise and his views on the market landscape. Here are the highlights of the interview:

1. Ethena enters the treasury bond sector to meet the traditional market's demand for crypto assets while addressing the issue of insufficient liquidity in the cryptocurrency market.

2. Ethena's latest financing is approximately $360 million, of which $260 million is cash. This funding will be used for open market purchases of tokens, which is expected to have a significant impact on token prices.

3. Ethena focuses on savings use cases, attracting users by offering high-yield dollar assets. In 2024, the average annualized return of USDe reached 18%, far higher than competitors.

4. Ethena generates profits through cash arbitrage or basis trading, mainly capturing the speculative premium in the cryptocurrency derivatives market.

5. Although the entry of ETFs and professional fund managers has compressed the basis, Ethena can still provide higher returns than traditional financial markets.

6. Ethena is collaborating with a federally regulated bank to launch a stablecoin, USDtb, in compliance with the new legislation, while retaining the offshore market USDe.

7. Guy Young is pessimistic about new entrants competing with existing giants in the stablecoin market, believing it is difficult to find a breakthrough.

8. Regarding the outlook for the crypto market, Guy Young is bearish on ETH and other Layer 1 public chains in the long run, but in the short term, ETH may benefit from a new market positioning.

9. Guy believes that BTC's market dominance should reach 90%, and the valuations of other Layer 1 public chains should significantly decrease, while a few projects with independent revenue and users may stand out.

10. Ethena currently holds a 6-10% share of the derivatives market, and Guy believes it has the potential to grow to 20-25%, which translates to a scale of 20 billion to 30 billion USD.