Young told Cointelegraph that the initial skepticism around USDe’s sustainability is “right” following the pitfalls of the last cycle.
The initial concerns around Ethena Labs’ USDe stablecoin yield are a natural sign of a maturing industry recovering from the collapse of the Terra-LUNA ecosystem, Guy Young, the founder of Ethena Labs, told Cointelegraph in an exclusive interview on Feb. 22.
Ethena’s USDe stablecoin caused widespread concerns in the crypto community after it launched on the public mainnet on Feb. 19. The USDe Ethereum-based synthetic dollar currently offers a 27.6% annual percentage yield (APY), according to Ethena Labs’ homepage.
The 27% yield caused concerns about the protocol’s economic sustainability, as it was considerably higher than the 20% yield offered by Anchor Protocol on Terra’s UST before the algorithmic stablecoin issuer collapsed in May 2022, erasing tens of billions of dollars of value in a few days.
