jakiro
Original title:>Ethena: The Trillion Dollar Crypto Opportonity
Author: Eugene Ng Ah SIO, encrypted trader, KOL; Translation: 0xjs@作 作 作 作 作
TLDR:
Ethena is the fastest growing DEFI product in history.In just a few months, its income stable coins have expanded to $ 3 billion. Since its establishment, there is no growth rate of other stablecoins compared with USDE.The first chapter of the Ethena story focuses on creating a safe and excellent stable currency.After successfully adopting the test of extreme market fluctuations, it now hopes to chase the largest award in the field of cryptocurrency -Tether’s 160 billion US dollars.
It is here that Ethena has shifted from “DEFI Native Stable Coin” to competitors with fiat currency stable coins with excellent value propositions and greatly improving the distribution channels.The latest participation of USTB, the latest participation of BlackRock’s national debt products, and the decline in interest rates have brought opportunities to Ethena. Now it is in a favorable position and is expected to make USDE the leading stable currency in the cryptocurrency field.
Due to the low market efficiency, you now have the opportunity to buy the most powerful new competitors in the largest vertical field in the field of cryptocurrencies. It is only 1/4 of the WIF market value.
Market situation
This cycle has been dominated by Memecoins.The market has recognized the market manipulation game of token to the VC project tokens that is relatively unconfirmed. The valuation of these projects is outrageous, which is several times higher than the cost basis of most VCs.On the contrary, we completely accepted a more free MEMECOINS game.Memecoins’s performance continues to be better than other cottage, which has led to some people’s “financial nihilism” -the ignoring all fundamentals in order to pursue narrative.Although this is the most profitable transaction in the industry in the past two years, it has become more and more common, and has even attracted people’s historical high attention to Memecoins.
People’s attention to Meme reaches a historical high source: kaito
With the market’s intoxication of Memecoin, it slowly forgets an eternal lesson taught in all markets:
The most powerful speculation is always based on at least some facts
The rise of Memecoin is mainly the market phenomenon of encrypted and retail -led.What these retail investors have forgotten that over time, the most liquid currency is always built on the growth of parabolic lines on the basic level.This is because only Xie Lin, all encrypted native capital pools (retail investors, hedge funds, self -employed funds, and only bulls), all encrypted capital ponds.This is the story of SOL in this cycle. Those who follow the development of developers in early 2023 can form a basic argument for the growth of the Solana ecosystem, and then enjoy the re -valuation of nearly 10 times within a year.
You may still remember the 500 times liquidity of Axie Infinity and the millions of players they attracted at the peak of excitement.Another very familiar reference is that Luna’s $ 40 billion UST is circulating globally, and 1000 times the income you can achieve within 18 months (assuming you purchased LUNA rebounded from the low point and the risk of screwing correctly in order to get rid of the dilemma)Essence
Although financial nihilism is the overall trend of this cycle, people may think that it is because the current lack of strong PMFs of venture capital projects leads to this wrong consensus point.
However, only one project can make the public dream again.
I believe Ethena is the most qualified candidate project in this cycle.
Fundamental
When considering stablecoins, there are actually only two things that are very important.
1. Value proposition -Why do you hold this?
Ethena’s products and value claims are very simple.Stay in $ 1, get Delta neutral positions between ETH and ETH’s short positions, and get benefits.Assuming the normalization of financing interest rates, SUSDE provides the highest sustainable return on all stable currency today (10-13% APY).This substantial value has made Ethena the fastest growing stable currency in history. It reached the peak of TVL 3.7 billion US dollars in 7 months, and stabilized at $ 2.5 billion after a decline in financing interest rates.
In terms of income, USDE is far better than all other DEFI products
At first glance, it is clear that SUSDE is the indisputable king of all cryptocurrencies.Why do you want to hold Tether and give up all possible benefits of the dollar today?It is probably because it is the easiest and most liquid.This reminds us …
2. Distribution -How easy is it to get it and use it as a currency form?
When starting any new stablecoin, the distribution channel is the most important factor to determine.USDT is the first stablecoin today because it is the basic currency of any market for each centralized exchange.This is a huge moat, and the new stablecoin takes years to start occupying market share.
However, USDE successfully did a very special thing.With the support of Bybit, it has been opened to users on the second largest CEX, and the platform has an automatic revenue function.This allows users to get better stable currency mortgages without increasing friction.So far, no other decentralized stablecoin has been included in any main CEX, which shows how difficult it is.
Source: Artemis
At present, the number of stable coins of the centralized exchange is about 38.6 billion US dollars, which is equivalent to 15 times the current supply of USDE.If only 20% of the stable currency is considered to earn 5-10% on USDE, it will mean that the USDE’s service market will increase by nearly 4 times.Now imagine what happened when all major centralized exchanges use USDE as mortgages?
Catalyst 1: Structured interest rates decreased
Since Ethena was established, the relative return rate of SUSDE was 5-8%of the federal fund interest rate.This structural advantage allows billions of dollars in the cryptocurrency field to seek capital in Ethena within nine months after the launch.
The recent Federal Reserve Dot Crac (SEP 2024)
Powell lowered 50 basis points in the federal fund interest rate in September, marking that global risk -free interest rates began to decline.The dotmine map is currently estimated that the federal fund interest rate in the stable state is 3-3.5%, which means that the interest rate in the next 24 months will drop by about 2%.However, this has nothing to do with Ethena’s benefits. In fact, it can be said that this has a positive indirect and indirect effect on financing interest rates (market rising -& gt; risk returns -& gt; leverage demand increase -& gt; financing interest rate increase).
When the two are combined, this powerful mixture can soar the spread, which is exactly the real value proposition of Ethena products.
When the funding rate decreases, the benchmark rate premium will decrease from about 10% to 2%
The supply of USDE is extremely sensitive to the difference in yields related to U.S. Treasury bonds
With reference to the above two charts, it can be clearly seen that the demand for USDE is highly sensitive to US Treasury yield premium.Six months before the increase in yield premium, USDE supply has increased.With the decline in premium, the demand for USDE naturally decreases.With these historical data, I believe that the return of yield premium will cause USDE growth to accelerate again.The important thing is that this smooth wind is easy to understand, but also attracts most market participants.
Over time, I expect this to significantly increase Ethena’s market share, just like Luna and UST’s Defi yields began to decline in 2021 and USAS’s 20% guarantee in ANCHOR is more and more popular.Same.
Catalyst 2: USSTB
USTB was launched for the first time two weeks ago. In my opinion, it is definitely a product that changes the rules of the game, which can enhance the use of USDE.
The main points of USSB are as follows:
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Stable currency supported by 100% supported by BlackRock and Securitize
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The function is exactly the same as other stable coins. It obtains income from U.S. Treasury bonds, but does not increase the risk of custodians/transactions
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It can become a subset of USDE, so that when the tradfi yield & gt; cryptocurrency yield, SUSDE holder can get the national debt yield
The market is underestimated, because now there is almost no reason to hold any other cryptocurrency stablecoins except USDE, provided that you can rest assured that exchanges like Binance will not go bankrupt (even if they go bankrupt, USDE will not fall down.To zero, because it is completely guaranteed by BTC and STETH).In the worst case, you will get similar returns to competitors. If not, you will gain benefits according to market risk appetite.
By integrating USTB in the back end, Susde’s yield volatility is now significantly reduced, thereby eliminating the biggest doubts that Ethena cannot obtain sustainable return in the bear market.The reduction of yield volatility has also increased the opportunity for future CEX integration.
With these two catalysts,Ethena has a high -quality and stablecoin, which is dominated by all other competitors.
Tokens Economics: Good, bad and opportunities
One of the disadvantages of VC tokens is that if you hold the tokens for a long time, you will naturally become the withdrawal of the early investors, teams and other stakeholders who have obtained tokens.Based on this alone, the entire market has completely abandoned the largest product market in this round of the product market, and has favored the pure Memecoin.
Ethena is no different from the usual VC tokens.Since the high point, ENA has fallen by about 80%due to rising issuance valuations and the supply of airdrops.In these 6 months, the airdrops in the first season have been completely unlocked, and 750 million tokens have entered the market.These unlocks and the demand for leverage decline, and eventually crushed ENA’s narrative. This is why no one has this currency today is why I strongly suspect that the re -rating will fluctuate severe fluctuations.
So why should you come into contact with this evil VC tokens now?The answer is simple -in the next 6 months, the number of ENAs that enter the market will decrease sharply, which greatly suppresses the pressure of selling.Yesterday, the first batch of tokens issued, among the new ENA supply of $ 125 million, only $ 30 million of the air investors chose to lock the remaining tokens.In view of the long time, what will happen when the air -proof investors have been the main marginal sellers in the past few months?The price has been found at the $ 0.2, and now it has formed a historical bottom at $ 0.26.
From now to April 2025, the only additional inflation will be the remaining about 300 million US dollars of airdropping rewards to enter the market, but at a price of 28 cents, this is equivalent to unlocking about $ 450,000 daily (less than a daily transaction volume less than daily transaction volume1%).From this perspective, although the inflation pressure of TAO is as high as 400-5 million US dollars, it has risen by 250%in the past month.The point here is that when the stars are arranged, the expansion unlocking rarely affects the re -rating of the token.After April 2025, the team/venture capital company began to unlock, so this gave us about 6 months to exert the above arguments.
How big is the dream?
Although ENA is the only new product with a clear PMF in this cycle, ENA has not entered the top 100 on Coingecko.From the perspective of technical analysis, ENA’s HTF chart looks very clean.Coupled with the fundamental driving factor + inflation pressure, I can easily foresee that ENA restores a level of $ 1.This will not even make the market value of ENA reach the market value of $ WIF, and only reaches the 1.5 billion US dollars of POPCAT circulation supply recently.
Looking at it further, Ethena has the foundation to expand USDE to tens of billions of dollars, and then hundreds of billions of dollars.In the end, as the encrypted stable currency further received market share due to international cross -border payment, $ trillion was not impossible.At this point, if ENA is the best product to chase the largest market for cryptocurrencies, it is not the top 20 tokens, which will surprise people.
When we can get there, no one is sure, but I think Ethena is the next big dream of cryptocurrencies in this cycle.
