Stablecoin

Token

2024

USDe

Ethena

<a href="https://bitcoinworld.co.in/andre-cronje-raises-concerns-over-ethena-labs-usde-stablecoin/" title="Andre Cronje Raises Concerns Over Ethena Labs’ USDe Stablecoin" rel="noopener noreferrer nofollow"></a>
<ul>
 <li style="font-weight: 400">Renowned decentralized finance (DeFi) builder Andre Cronje has expressed concerns about the incentives behind Ethena Labs’ USDe stablecoin in a post on X.</li>
</ul>
Renowned decentralized finance (DeFi) builder Andre Cronje has expressed concerns about the incentives behind Ethena Labs’ USDe stablecoin in a post on <a href="https://twitter.com/AndreCronjeTech/status/1775398490404724914" rel="noopener noreferrer nofollow">X</a>.&nbsp;
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 Every so often we see something new in this space. I often find myself on the mid curve for an extensive amount of time. I am comfortable here. That being said, there have been events in this industry I wish I was more curious about, there have also been events I definitely did…
 — Andre Cronje (@AndreCronjeTech) <a href="https://twitter.com/AndreCronjeTech/status/1775398490404724914?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">April 3, 2024</a>
</blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
Cronje, known for his thought leadership in the DeFi space, indirectly mentioned the protocol and its synthetic dollar, highlighting his worries about Ethena Labs’ risk management practices, specifically addressing funding rates in perpetual futures contracts.
Cronje stated, “While things are going great now… eventually that turns, funding becomes negative, margin/collateral gets liquidated, and you have an unbacked asset.”&nbsp;
Although Cronje did not explicitly name Ethena Labs or USDe, his concerns were evident regarding the stability and backing of the asset.
Ethena Labs’ USDe stablecoin yield initially raised concerns when it launched on the public mainnet on February 19.&nbsp;
See Also: <a class="row-title" href="https://bitcoinworld.co.in/usde-investors-to-claim-their-share-in-ethena-labs-ena-token-airdrop/" aria-label="“USDe Investors To Claim Their Share In Ethena Labs’ ENA Token Airdrop” (Edit)" rel="noopener noreferrer nofollow">USDe Investors To Claim Their Share In Ethena Labs’ ENA Token Airdrop</a>
At the time, it offered an annual percentage yield (APY) of 27.6%, significantly higher than the 20% yield of the failed TerraUSD (UST) on the Anchor protocol.
Guy Young, the founder of Ethena Labs, responded to the concerns, <a href="https://www.youtube.com/watch?v=iT7IcCZK58U" rel="noopener noreferrer nofollow">stating</a> that the skepticism surrounding the project is a sign of a maturing industry.&nbsp;
Young emphasized that funding rates turning negative is not a major worry, as they had only dipped below -3% for a week in 2022, which was a particularly challenging year for the crypto market.&nbsp;
To address potential risks associated with negative funding rates, Ethena Labs incorporates other measures such as an emergency insurance fund and arbitrage mechanics.
<blockquote>
 Disclaimer: The information provided is not trading advice. Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
</blockquote>
#Binance #WRITE2EARN
The post <a href="https://bitcoinworld.co.in/andre-cronje-raises-concerns-over-ethena-labs-usde-stablecoin/" rel="noopener noreferrer nofollow">Andre Cronje Raises Concerns Over Ethena Labs’ USDe Stablecoin</a> appeared first on <a href="https://bitcoinworld.co.in" rel="noopener noreferrer nofollow">BitcoinWorld</a>.

Andre Cronje Raises Concerns Over Ethena Labs’ USDe Stablecoin

ItsBitcoinWorld

Other articles published on Apr 5, 2024

Ethereum Layer-2's Will Reach $1 Trillion | VanEck Report

Bitcoin Mystery: $250 Million Leaves Major Exchange as BTC Price Dips

How Is the Crypto Market Doing Today?

Two Key Trends to Watch Ahead of Bitcoin (BTC) Halving

Pushd Presale Hits Stage 6 at $0.144, Attracting Stellar and Cardano Investors, Rivaling Amazon’s...

Osmosis Price Prediction: OSMO At Make Or Break Level, What’s Next?

Join our free newsletter for daily crypto updates!