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In this conversation, we chat withGuy Young - the CEO and Founder of Ethena Labs, the crypto infrastructure company building USDe which is the first-ever scalable stablecoin not reliant on existing banking institutions alongside a permissionless 'internet bond'.
Prior to Ethena, Guy spent nearly a decade working in the traditional finance industry across investment banking, hedge funds, and private equity firms, most recently at Cerberus Capital Management a $50bn investment fund.
His most recent position was of Head of Principal Investments at a Cerberus affiliate, where he led the firm’s expansion into Australian markets and oversaw strategic investments across banking, specialty finance, insurance, fintech and more.
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1’20”: Strategic Investments: Distressed Assets and Value Opportunities in Financial Services
4’19”: Analyzing Collapse: The Underlying Mistakes Leading to Financial Institution Failures
6’22”: Market Missteps and Innovation: The Human Element in Financial Risks and the Allure of Crypto Markets
9’37”: Decoding Value and Innovation: The Dynamics of Ethereum Economics and the Future of DeFi Tokens
16’40”: Balancing Returns and Risks: Understanding Ethereum's Capital Market Structure and the Role of Perpetual Swaps
21’47”: Synthetic Leverage in Crypto Markets: Analyzing the Persistent Tilt in Funding Rates and the $30 Trillion Perpetuals Phenomenon
25’26”: Strategic Hedging with ETH: Understanding the Perpetual Market Mechanics and Identifying the Risks
28’30”: Exchange Relations and Risk Mitigation: Balancing Volume and Counterparty Exposure in Perpetual Markets
31’42”: Impact of Scale on Ether: Assessing the Price Dynamics of Synthetic Assets and Their Influence on the Underlying Market
36’23”: Exploring Synthetic Stability: The Mechanics of Crypto-Native Dollars and the Potential for Traditional Market Integration
40’50”: The channels used to connect with Guy & learn more about Ethena
Sneak Peek:
Guy Young: …start with Ethereum, it's obviously just incredibly interesting that you have an open platform that really is just a blank service for people to come on and innovate and that there is some level of translating that innovation and what's built upon it into the underlying economics of Ethereum itself. And so, I think as part of the transition to proof of stake where you now have inability to be part of that network, securing the network and then sort of see some of the rewards as part of that, whether it's inflationary level rewards, or is it the rewards that you get from execution at the base layer. So really if you believe that this is an interesting platform where new financial applications or other types of applications can build and grow, there is a very clear line of sight into how Ethereum can accrue value within that structure.
I think part of the challenge of what you've seen with DeFi applications build upon Ethereum is really I think an idea that they can potentially create an enormous amount of consumer service and value for consumers and might lead to the disruption of equity value within the real world. But they do have significant challenges when it comes to actually capturing that value. So, I think perhaps one of my more cynical views on crypto as a whole is that it's going to create a ton of value but capture almost none of it. And there's a lot of reasons why that might be the case. I think part of that is driven by an open-source culture within crypto. It's really not difficult to fork a lot of these applications and try and rebuild it. And your ability to actually extract a durable value stream out of what you're producing when everything is open source and can be copied is obviously reasonably challenging three time unless you have something that's truly unique about what you're doing.
And so, I think that's part of the challenge where in 2019 and 2020 you saw the application-level layer of Ethereum and DeFi in particular greatly outperform Ethereum from a price perspective. And since then, it's really been…
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Finance is being pulled apart by the forces of frontier technology. From AI, to blockchain, crypto and DeFi, to mixed reality, chatbots, neobanks, and roboadvisors — the industry will never be the same. Here is the blueprint for navigating the shift.
Finance is being pulled apart by the forces of frontier technology. From AI, to blockchain, crypto and DeFi, to mixed reality, chatbots, neobanks, and roboadvisors — the industry will never be the same. Here is the blueprint for navigating the shift.
