Hive Mind Podcast: Ethena CEO Analyzes the Stablecoin Market and Crypto Assets Trends

1. Ethena's stablecoin innovation and market insights

The founder and CEO of Ethena, Guy Young, introduced the company's USD asset project, with a total scale of approximately $360 million, of which cash accounts for as much as 72%. Ethena's goal is to bring in new capital to address the liquidity issues in the Crypto Assets market. The funds they have raised account for 8% of the project's circulating market value, which is significantly higher than other projects.

Guy Young stated that Ethena's strategy focuses on areas that can significantly outperform competitors, such as savings rather than payment scenarios. In 2024, the average annualized return of USD reaches 18%, which is four times Circle's interest income. Ethena captures the speculative premium in the derivatives market through basis trading strategies, providing higher returns for investors.

2. Competition in the Stablecoin Market and Ethena's Differentiation Strategy

Guy Young believes that in the future, stablecoin issuers will focus on niche markets instead of trying to be a one-size-fits-all solution. Ethena views Tether as a strategic partner rather than a direct competitor. Their innovation lies in productizing the use case of capturing Tether's basis, creating an enhanced yield product.

With the launch of Bitcoin and Ethereum ETFs, the basis trading space has significantly narrowed. Guy Young stated that Ethena's strategy is to become a bridge for institutions entering the Crypto Assets market. Although the basis will compress with institutional capital inflows, Ethena believes that its efficiency advantage will continue to attract funds.

3. The Genius Act and New Regulatory Opportunities for Stablecoins

The passage of the Genius Act provides a clear regulatory framework for the stablecoin industry. Ethena announced a partnership with Anchorage to adopt a dual-track strategy: USDTB will be issued through Anchorage in compliance with the Genius Act; USD will continue to serve the offshore DeFi market. Guy Young believes that the U.S. market has huge potential but intense competition, and offshore DeFi remains Ethena's core growth engine.

Regarding the rumors that Tether may enter the US market, Guy Young stated that this aligns with Ethena's dual-track strategy. He expects the global market to form a binary pattern between the US and non-US.

4. The Momentum of the Crypto Market and the Valuation Controversy of Layer 1

Guy Young is bearish on ETH and other Layer 1 assets in the long term, believing they are the most overvalued assets in financial history. He predicts that in the future, only five to ten projects with real revenue, users, and products will enter the equity market, priced according to traditional valuation standards.

Regarding the development prospects of Ethena, Guy Young expects that if it can optimize to a 20-25% market share, the scale could reach 20 to 30 billion USD. He also pointed out that the revenue of application protocols relies on high transaction volumes of Layer 1; if Layer 1 valuations collapse, these protocols may be affected.

5. The Financing Controversy of MEW and the Future of MeMe Coin Market

The recent market value drop of MEW has sparked discussions. Guy Young believes that the MEW team has the ability to turn the situation around, with $2 billion in cash available to build a social speculation platform. He suggests that MEW guide users to shift from MeMe coin trading to high-profit products such as perpetual contracts, to achieve natural expansion.

Regarding the motivation of the founders, Guy Young stated that the MEW founder is already financially free, and their drive lies in industry influence and innovative achievements. If 2 billion dollars are used for socialized financial products or cross-domain expansion, it could reshape the landscape of the MeMe coin market.