UNCHAINED: Ethena’s USDe Grew to $2 Billion in 7 Weeks. Is It Safe?

Ethena’s synthetic dollar, USDe, hit a $2 billion market cap in just seven weeks, raising eyebrows. Ethena Labs founder Guy Young explores the risks of reinventing the digital dollar.

Listen to the episode on Apple Podcasts, Spotify, Fountain, Overcast, Podcast Addict, Pocket Casts, Castbox, Google Podcasts, Amazon Music, or on your favorite podcast platform.

This week, Ethena was in the spotlight after the airdrop of ENA, its new governance token. Ethena’s flagship product, the “synthetic dollar” USDe has amassed a $2 billion market cap in less than two months. Meanwhile, ENA’s market capitalization sits around $1.4 billion, with a fully diluted valuation of $15.5 billion. 

In this episode, Guy Young, founder of Ethena Labs, discusses the risks associated with Ethena, including custodial risks and counterparty risks to exchanges. Young also talks about the use cases of Ethena’s governance token, and discusses the potential for Ethena to be integrated with DeFi and CeFi.

Show highlights:

An introduction to what Ethena is and how USDe worksWhy the team doesn’t want to refer to USDe as a stablecoin and prefers to use the term “synthetic dollar”What the risks of USDe are, including custody, counterparties, and smart contractsWhy Guy is “pleased” with how the ENA airdrop went throughHow ENA will be used and what its role will be in the governance of EthenaWhy Ethena is now onboarding Bitcoin as collateralWhy Guy thinks that there’s been an “exaggeration” regarding the situation with Maker and AaveGuy’s response to the critics who say that Ethena is essentially Terra/LunaWhether USDe would only work in a bull marketHow the Ethena insurance fund works and what it aims to accomplishWhat’s next for Ethena after onboarding Bitcoin, with Solana potentially being the next asset

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Guest

Guy Young, founder of Ethena Labs. 

Previous appearance on Unchained: How Ethena’s USDe Challenges Traditional Stablecoin Models

Links

Ethena: 

Unchained: What Is Ethena’s USDe Synethic Dollar? A Beginner’s Guide

Decrypt: Ethena Just Launched to a $1.2 Billion Market Cap: Here’s What You Need to Know 

Dust on Crust by Arthur Hayes

Airdrop:

Unchained: Airdrops From Wormhole and Ethena Labs Set to Inject $2.4 Billion Into Crypto Market This Week 

CoinTelegraph: Ethena will become highest revenue-generating crypto project — Delphi Labs CEO

ENA Airdrop and Season 2: Sats Campaign 

Learn more: What Is a Crypto Airdrop? A Beginner’s Guide

MakerDAO/Aave controversy: 

The Block: MakerDAO proposes allocating $600 million worth of DAI into USDe and sUSDe

The Defiant: DeFi Projects Clash After MakerDAO Adds Ethena’s USDe As Collateral

Comparisons to Terra’s UST: 

Unchained: As Ethena’s USDe Quickly Reaches $2 Billion in Market Cap, Some Wonder If It’s as Risky as Terra’s UST

The Defiant: Ethena Stablecoin’s 27% Yield is Triggering Terra-Induced PTSD

Andre Cronje’s thoughts on USDe

Cointelegraph: Ethena Labs founder clarifies USDe stability amid high yield worries

Unchained Podcast is Produced by Laura Shin Media, LLC.  Distributed by CoinDesk. Senior Producer is Michele Musso and Executive Producer is Jared Schwartz. 

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