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Guy Young (0:00)

This particular bear market had a few different exogenous things that came together that in many different ways were like some of the worst things that could have happened to Ethena, even outside of normal market conditions. So far, we've never lost a single dollar of people's money, which is probably the most important piece.

Ran Neuner (0:14)

Walk me through how Ethena makes revenue.

Guy Young (0:16)

It's pretty simple, there's kind of two big revenue lines. One is the interchange on the card spend. So we'll make a percent basically on every card spend that comes through. And then the other big piece is just the buying out of your early investors.

Ran Neuner (0:28)

What was the logic? What was the rationale there? What were you trying to achieve? Where did you get the money from?

Guy Young (0:31)

All of these different pieces were kind of like the combination of a lot of negative feedback that I've read either on the timeline on Twitter or had just received directly from users. Ethena was almost like the poster child for VC coin that like VCs are just going to be dumping on you the whole time. Let's just double down on ourselves and actually buy out the investors. It was in the tens of millions of dollars basically at pretty much at the stone cold bottom.

Ran Neuner (0:54)

You didn't know how long the bear market was going to last. Instead of choosing to keep your runway, you chose to buy back the tokens. That's a real signal of how much you guys back the value of a token. Now tell me about why you chose Avalanche. Was it a case of the foundation getting very much behind you and giving you guys big support and big grants? And what did they give you guys?

Guy Young (1:11)

I'm not sure. Yeah, I'm in a position where I can narrow it down.

Ran Neuner (1:14)

But surely you can tell us what they gave you. I mean, it's public blockchains, isn't it?

Guy Young (1:18)

It is actually quite a big one, I think.

Ran Neuner (1:23)

Guy, that looks like quite a brutal bear market. Like that, when I look at that line over there, it's like quite a brutal bear market for Ethena. Tell me a little bit about how this period was for a yield generating coin that basically relies on market exuberance.

Guy Young (1:39)

Quite an intro.

Yeah, I mean, we, I guess, have been through a few different challenging periods since we came out in the last three years. It hasn't been sort of plain sailing since the beginning. I think it's been, yeah, maybe two or three different periods where we've had, you know, general cool down in the market and conditions that aren't as easy to sort of grow as when we first came out. I think being pretty pleased, I think, with the motivation and kind of just focus from the team, which is kind of blocking out the noise in the market and just trying to focus on the things that matter, which is just, you know, growing products and finding ways to add new things to the arsenal in terms of what Ethena can do. And so I think during this period, obviously been quite a market period in the last year, but it's been a lot of time investing into Ethena Pay, which we announced last week, which is a very big piece for us, which we can jump into sort of like the thesis and why it's exciting to us, I'm sure, through this call. But yeah, I wouldn't say it's like the first time that this has happened, and generally pretty pleased with the motivation and sort of like continued focus from everyone on the team, despite everything that was going on in the market. And yeah, only had like, I think, one resignation in the last three years at Ethena, which is a pretty proud piece for us and coming out of the bad market, the cycle.

Ran Neuner (2:55)

That's absolutely insane. One resignation from a team of how many people?

Guy Young (3:00)

It grew from around just under 30 at the back end of last year to roughly around 40 at the moment. And that's insane. Obviously, yeah, and also I think for, you know, team members who had kind of come in, made life changing amounts and then lost it kind of three or four times in two years. It's a pretty big emotional roller coaster for people on the team. So I think, yeah, to have everyone sort of stick around through those eyes and nose, I just think speaks to, you know, people being mission driven around what we're doing and like the products that we're spending time on.