On The Brink with Castle Island

Guy Young, the founder and CEO of Ethena, joins the show to talk crypto-backed stablecoins.  How Ethena began with an Arthur Hayes blog post The origins of synthetic stablecoins on Bitmex The difference between Hayes’ Nakadollar and the Ethena design Why synthetic stablecoins have failed in the past and how Ethena addresses this How staked ETH as the underlying collateral opens up a new design space How Ethena mitigates their exposure to exchanges with off-exchange custody Guy’s backstory and entrance into crypto Why the circumstances are favorable for the success of a synthetic stable today Why the short leg of the Ethena position has to rely on CeFi for now Where the yield from ETH positive funding ultimately comes from Limits to scale on Ethena on the short leg of the trade and ETH staking Guy’s explanation for where the yield from being long ETH comes from Correlation dynamics between the ETH yield and the funding rate Why it’s important that crypto yields are somewhat negatively correlated with tradfi y