Interview — Guy Young (Ethena)

"Crypto needs to go and meet users where they are in the real world, with a form factor they are used to."

At Consensus Hong Kong 2026, held from 10 to 12 Feb 2026 at the Hong Kong Convention and Exhibition Centre, there was one topic you could not escape: stablecoins and yield, and the way the two are quietly becoming core market infrastructure.¹ No project embodies that shift more literally than Ethena, whose synthetic dollar, USDe, turned "a dollar that pays a yield" from a slogan into one of the fastest-growing products the sector has produced.

Guy Young is an unlikely figure to have built it. Before founding Ethena in 2023, he spent six years at Cerberus Capital Management, the roughly $60B investment firm, latterly as head of principal investments at a Cerberus affiliate, where he led an expansion into Australian markets and looked at banks, specialty finance, insurance and fintech across the capital structure. Behind that sat seven years across investment banking, hedge funds and private equity. He left conventional finance not long after the Terra/Luna collapse of 2022, when Arthur Hayes published an essay sketching a crypto-native synthetic dollar. That idea became USDe, which launched in Feb 2024: a token that holds spot crypto collateral while shorting an equivalent amount of perpetual futures, so the position is broadly delta-neutral and the yield comes from staking rewards plus the funding rate paid to shorts.³ Governance sits with the ENA token; a separate, purpose-built product, USDtb, is backed by BlackRock's money-market fund.³ By late 2025, USDe had grown past $14B in supply.⁴

We met on the sidelines of Consensus, in a city that has made itself the meeting point of Eastern capital and Western regulation. Young is measured and, for a founder, strikingly willing to argue against the prevailing mood, whether the subject is token buybacks, the state of crypto's user base, or how many stablecoins the market can really support.

The Node: Why did you decide to build one of the hardest things there is: an algorithmic stablecoin?

Guy Young: It is a slightly insane thing, especially if you think about the two things that blew up last cycle: centralised exchanges, with FTX, and then Luna. The two biggest, highest-profile blow-ups. And we came together with a product that was, in some senses, a combination of the two, which is slightly insane.

I think it is also just because it is a big opportunity, and that is why people find it interesting and why it captures the imagination. This idea of a dollar with a yield that anyone on Earth can get access to is a powerful one. I only ever wanted to work on things that could be very big and meaningful if you did them the right way. Hard things, difficult things, lots of competition: if you do not have those things, that is actually the more worrying sign, because it suggests you are not working on something meaningful or with real upside. So I do not have an issue with that kind of difficulty.

Could you explain the architecture of Ethena, the ENA token and USDe, in layman's terms?

It is pretty simple. The way to think about it is almost as a different form of a bank. You have USDe, which looks a bit like a deposit: people put money in and expect to get some sort of return on the other side. And then there is the yield you generate on the asset. Hopefully, if you are a sustainable business, you make a healthy spread on top of that.

Within the space of dollar issuers, there is obviously a very wide range of how much you can actually make in terms of margin. Tether is one of the best examples of an incredible business that captures effectively all of the yield and manages to keep it. Ethena's business is slightly different, in that we share the majority of it with users, and then keep a spread that can be captured by the protocol and, ultimately, the token. We are in a position now, and this has been confirmed in several ways, where there is no side equity business taking any of the cash the core business generates. It all accrues to the token.

There is a big obsession at the moment with buybacks. I think they are useful as a signalling mechanism, to show you care about these things. But in some senses it is a slightly insane thing to even consider, because many of these projects are startups. No one is going to the AI startups and saying, you have to buy back shares after two years. It is actually a bit of a counter-signal: if you do not have anything to reinvest cash into in terms of growth, what does that say about the growth prospects of your business? For us, we have a macro view that stablecoins are at least ten times bigger from where they are now. In the next five years it will be a multi-trillion-dollar subsector within crypto, and the products that carry rewards will grow as a share of the total market. Fast forward three to five years, and we expect this to be a $100B to $200B supply of what we are building. In that context, you should be focused on getting to that maturity, not on capturing a few more buybacks right now. That is the prize you should be going after.

USDe's growth has been significant, with market share increasing month after month. How do you explain the success, and how do you win users' confidence?

The product is good and bad in that it is quite reflexive to the cycle. When interest rates and leverage demand in the space pick up, it becomes extremely attractive, and it is very easy to grow. It is not difficult to sell a dollar that has a 10, 15 or 20% return. The more challenging part is when the market unwinds, in the same way we saw in October: keeping the users you built up in the good times, and giving them the confidence that the product is resilient through both the highs and the lows of the cycle.

I think we have done a decent job of surviving some of these tail-end events, like the Bybit hack and then the October crash. In some senses, those are exactly the events everyone is expecting. If a product is going to blow up, something like those two would have caused it. So you need to go through them without any issues. That is a necessary condition to be able to grow to $20B, $30B, $40B, $50B. We went from zero to just under $15B in the first eighteen months. That has come off since the market cooled after October, and you saw open interest on centralised exchanges come down more than 50%, which is roughly how we have tracked.

A lot of it is really just taking a fundamentally different approach to normal fiat stablecoin issuers, and being aggressive about going to where people actually use these products. We always had the view that a lot of builders ignore CeFi as a distribution channel. They think of centralised exchanges as dirty black boxes, when that is still where all the users are sitting. You have to be open to working with them if you want to access the larger pools of users. Getting the centralised exchanges on board has always been a key focus for us, and I think we have done a decent job of it over the last eighteen months.

In crypto there are basically two audiences, institutions and retail. How do you address both?

The interesting thing about a dollar with a yield is that it is one of the few products that appeals to anyone. It does not matter if you are a hedge fund in New York, a family office in Hong Kong or a retail individual in Europe. It is a universal product. So we have different channels, with varying degrees of success. On the retail side, those are the users you see within DeFi, coming to the app directly. A lot of the institutional usage tends to be collateral and trading use cases you see within CeFi, plus the work we are doing with different asset managers to see whether we can distribute into their products in TradFi.

One of the interesting qualities here is that the rate on this product has a different correlation to the rates you see in the real world. When Fed funds rates come down, you sometimes see credit rates go up in crypto, because speculation picks up. That is a powerful quality when you are speaking to people in TradFi, because everyone is always looking for negative correlations to offset the rest of a portfolio. Being able to say this product could potentially go up while Fed funds rates go down makes it an interesting diversifier. It becomes more interesting as we get into more of a rate-easing cycle. We just also need crypto markets to stop collapsing in the way they have; the last six months has not been very helpful.

We are still waiting for a successful consumer app besides prediction markets, which are now a real thing. Should we expect something from Ethena?

Yes, and it is fairly obvious to guess what it might look and feel like. There is an interesting opportunity, not just for Ethena but for anyone providing DeFi products, even in money markets. Aave, for example, came out with its app relatively recently, and I think that is the direction a lot of these applications and businesses are going.

Part of that is admitting that, in some senses, we have run out of the crypto-native user, and we are just recycling the same chips between each other. You need to go and meet users where they are in the real world, with a form factor they are used to. Expecting the whole world to load up a MetaMask account and get comfortable working on a desktop application is just not the way most people are going to interact with these products.

So you have two choices. One is to be back-end infrastructure on a normal Web2 distribution platform, whether that is a Morpho vault on Coinbase or the Binance integration we did with them, where DeFi applications are effectively providing the infrastructure for CeFi user experiences. The other option is to build that yourself: you provide the actual product and interface, and you control your own destiny a bit more by being close to the user. That is one area we are spending time thinking about, and a pretty natural evolution of the product.

Regulation is still a significant topic, and the landscape keeps shifting in both Europe and the US. How do you navigate that?

It is not easy, especially because there is not even consistent regulation between the regulators in Europe and the US. You are in a strange position where the product itself is global by nature. You can buy USDe sitting in Europe or in the US, and it is the same fungible token, yet regulators have completely different views on the appropriate way to manage the reserves behind it.

It was very positive to see what is happening with GENIUS. Our approach in response has been almost identical to what Tether has done: you keep the legacy product aimed at more offshore markets, which for us is USDe and for them is USDT, and then you build a purpose-built product, which for us is USDtb, backed by BlackRock's money-market fund. That fits neatly with everything GENIUS is after. So you end up with two different products attacking two different markets under two different regulatory regimes, and you can custom-fit each one.

Broadly, though, while it is great to see what is happening with GENIUS in the US, we spend less time trying to compete in that market than in the rest of the world. One of the lessons from Tether's success is that it is a better business to provide dollar rails to the rest of the world than to America, because the US already has good financial infrastructure for moving money around. You have Venmo, you have money-market funds. The existence of all that other infrastructure means your ability to capture value and spread by competing there is massively reduced. So we do not have as much interest in competing with Stripe and Circle in the US. We have a product there, but it is the offshore markets that are more interesting to us.

Speaking of fragmentation, do you think this is a winner-takes-all market?

We are seeing the emergence of custom, white-label type solutions, and I do think that trend continues: businesses, chains and apps wanting to control the brand, identity and economics. But none of those white-labels will get to $10B or $20B scale. They are all going to be slightly subscale, servicing what people call closed-loop systems. If you control the users within your own little wallet or environment, yes, you can put your own stablecoin in there. But there is no reason Binance would integrate your closed-loop, purpose-built stablecoin that is specific to your ecosystem. So we will see a proliferation of those products, but none of them reach mega scale like Tether and Circle.

I actually think we are almost done on that front. I do not think we will ever see someone new get to, say, $15B. We were the first to do that in the last five years. Binance's BUSD, back in 2020, was really the last token that got that big. And I do not think we see open digital dollars get to that scale again. You might see something like JP Morgan shifting a lot of deposits into a stablecoin, but that is more of a closed-loop thing than a neutral issuer providing assets across many businesses. That, I think, is winner-takes-most, or at least an oligopoly, where three or four entities have around 90% market share. That is how the market has existed for both stablecoins and centralised exchanges for the last few years, and I think for stablecoins, even more than exchanges, it continues.

Do you have any interest in stablecoins denominated in other currencies?

If they simply look and feel like normal stablecoins pegged to another fiat currency, we have less interest. Users have shown there is not much demand for those; the largest one in the market is around $400M, which is just not big enough to interest us. Different-currency savings accounts are a very different question. Could you create a product like a dollar with a higher reward rate, rather than something used purely for payments? That, I think, is a very big opportunity, because a lot of the world wants to save in dollars but cannot easily do so. In a lot of countries, if you can offer two, three, four percentage points over the local rate, the addressable market is basically the whole world. I will not say exactly how we think about our own product, but it is interesting to us, and it will be something we come out with relatively soon.

Editor's note: what has changed since this conversation

This interview was conducted at Consensus Hong Kong in Feb 2026. A few updates are worth flagging.

After peaking above $14B in Oct 2025, USDe's circulating supply fell roughly 60% to about $5.9B by Mar 2026, as the post-October leverage unwind drained the Aave and Pendle loops that had become its main demand engine. By Q2 2026 supply sat around $5.5B to $6B, still the largest crypto-collateralised synthetic dollar after Sky's USDS.⁵

On distribution, the institutional push he referred to took concrete form: during 2026 Ethena introduced iUSDe, an institutional version wrapped with the compliance, custody and reporting features intended to onboard hedge funds, family offices, asset managers and prime brokers.⁶

On the question of token value and buybacks, StablecoinX, a treasury vehicle built around ENA, closed its combination with TLGY Acquisition Corp and began trading on Nasdaq under the ticker "USDE" on 26 Jun 2026, backed by roughly $890M in PIPE financing and holding around 3B ENA tokens, a chunk of it earmarked for further purchases.

Last point, since the conversation, Ethena has moved to diversify USDe’s backing, cutting its reliance on perpetual futures and adding institutional lending and real-world assets to make the reserve more resilient across market cycles. ⁷

Sources

1. Consensus Hong Kong 2026, CoinDesk (conference dates and venue): https://consensus-hongkong.coindesk.com/

2. Ethena USDe project overview and mechanism, Messari: https://messari.io/project/ethena-usde

3. USDe supply peak above $14B (Oct 2025), crypto.news: https://crypto.news/stablecoinx-hits-nasdaq-as-ethenas-usde-supply-keeps-shrinking/

4. "Ethena's USDe Q1 2026 report," Stablecoin Insider; USDe supply decline to c. $5.9B, crypto.news: https://stablecoininsider.org/ethena-usde-q1-2026-report/

5. iUSDe institutional product, Ethena USDe Q1 2026 report, Stablecoin Insider: https://stablecoininsider.org/ethena-usde-q1-2026-report/

6. "StablecoinX debuts on Nasdaq," Crypto Briefing; "StablecoinX raises $890 million," Brave New Coin: https://cryptobriefing.com/stablecoinx-nasdaq-debut-ethena-ecosystem/

7. “USDe Backing Diversification: Building Resilience Across Market Cycles”, Ethena.fi, April 2026