Ethena Founder: Crypto-Native Capital may have run out of steam to pump meme coin valuations, tokens backed by TradFi endorsement will undergo a complete divergence from regular meme coins
BlockBeats News, July 25th, Ethena Labs founder Guy Young posted on social media: "One of my major concerns is that the native capital of crypto may have been exhausted, unable to propel meme coins past the previous cycle's peak. Observing the total nominal market capitalization peak of meme coins in Q4 2021 and Q4 2024, both stopped at around $1.2 trillion (a value that is almost identical after adjusting for inflation). Perhaps this is the global retail capital's valuation ceiling for 99% of meme projects?"
However, for tokens with real business operations, tangible products, and generating revenue for real users, there exists a massive blue ocean to expand channels to stock market institutional investors. Compared to the global stock market capitalization, the entire meme coin market is just a drop in the bucket. The current NAV premium arbitrage is clearly a flash in the pan, with Saylor being the only exception, ultimately due to its unique leverage advantage in its capital structure (quasi non-redeemable + quasi).
But why did Ethena still support StablecoinX's ENA treasury strategy? The core goal is to build a gateway for stock market funds to enter—these funds have a significant excess demand for stablecoins and digital dollar field's hyper-growth enterprises. This is unrelated to short-term NAV arbitrage; the key is to open the gate to an untapped capital pool. Ethena faces the well-known dilemma of VC unlocking pressure, and I have personally made countless mistakes in fundraising and still reflect on them. There is a severe capital misalignment in the crypto world: private VC capital far exceeds the liquid capital required to support token valuations, creating a mirrored opposition to the Web2 world (where private capital is only a fraction of the stock market).
Of course, this does not apply to all junk coins. Zero-revenue meme projects, even if dressed in an equity shell, remain air. But I firmly believe that for the few tokens that can obtain traditional financial endorsement and align with long-term growth trends, this will be a significant positive. Apart from mainstream coins, such tokens globally do not exceed 10, and they will ultimately differentiate completely from coins that have never attracted TradFi."
You may also like

February 10th Key Market Information Gap, A Must-See! | Alpha Morning Report

About ERC-8004: Everything You Need to Know

ai.com's Debut Flop: After $70 Million Transaction, Did It Get a '504' Timeout?

FedNow versus The Clearing House: Who Will Win the Fed Payments Fray?

Recovering $70,000 in Lost Funds: The "Fragile Logic" Behind Bitcoin's Rebound

Mr. Beast acquires Step, Farcaster Founder Joins Tempo, what are the international crypto circles talking about today?

February 9th Market Key Intelligence, How Much Did You Miss?

After being questioned by Vitalik, L2s are collectively saying goodbye to the "cheap" era
WEEX AI Trading Hackathon Paris Workshop Reveals: How Retail Crypto Traders Can Outperform Hedge Funds
Witness how WEEX's Paris AI Trading Hackathon revealed AI's edge over human traders. Explore key strategies, live competition results & how to build your own AI trading bot.

U.S. Oil (USOR) Price Prediction 2026–2030
Key Takeaways U.S. Oil (USOR) is a speculative Solana-based crypto project that aims to index the United States…

USOR Surges on Meme Narrative Despite No Real-World Asset Backing
Key Takeaways: USOR, a Solana-based token, has seen a notable surge driven by speculative narratives rather than verifiable…

How to Buy U.S. Oil Reserve (USOR) Cryptocurrency
Key Takeaways U.S. Oil Reserve (USOR) is a Solana-based token primarily traded on decentralized exchanges (DEXs). Claims have…

USOR vs Oil ETFs: Understanding Why the ‘Oil Reserve’ Token Doesn’t Track Crude Prices
Key Takeaways The U.S. Oil Reserve (USOR) token has become noteworthy for its claims, yet it does not…

Trend Research Reduces Ether Holdings After Major Market Turbulence
Key Takeaways: Trend Research has significantly cut down its Ether holdings, moving over 404,000 ETH to exchanges recently.…

Investors Channel $258M into Crypto Startups Despite $2 Trillion Market Sell-Off
Key Takeaways: Investors pumped approximately $258 million into crypto startups in early February, highlighting continued support for blockchain-related…

NBA Star Giannis Antetokounmpo Becomes Shareholder in Prediction Market Kalshi
Key Takeaways: Giannis Antetokounmpo, the NBA’s two-time MVP, invests in the prediction market platform Kalshi as a shareholder.…

Arizona Home Invasion Targets $66 Million in Cryptocurrency: Two Teens Charged
Key Takeaways Two teenagers from California face serious felony charges for allegedly attempting to steal $66 million in…

El Salvador’s Bukele Approval Reaches Record 91.9% Despite Limited Bitcoin Use
Key Takeaways: El Salvador President Nayib Bukele enjoys a record high approval rating of 91.9% from his populace,…