DeFi’s Institutional Breakthrough - TOKEN2049 Singapore 2026

Well, cool. First off, thank you everyone for being here. I'm Robbie, one of the investment partners at A16Z. I help lead a lot of our DeFi efforts. I'm joined by an incredible group of panelists here. I don't think any of them need an introduction, but maybe we can quickly go down the line and do some introductions. And then you guys can each explain what you're working on respectively. And Stani, maybe we start with you.

Hey everyone. I'm Guy Young, founder and CEO of Ethena Labs. We started the business around 3 years ago now, and the core initial product was a dollar savings asset that anyone in the world could access with just an internet connection. Came out with the product around 2 years ago now, and scaled from zero to a peak of around 15 billion last year. That was the fastest growing dollar asset to ever breach 10 billion dollars in supply, and the only one that has done that in the last 7 years. And since then I've built out different pieces of the business. So we have a white label stablecoin infrastructure piece of the platform now, where other applications, chains, wallets, businesses can launch their own stablecoins on our stack. And then announced Ethena Pay neobank around a month ago, which is really our attempt at sort of taking our core savings product to an audience that exists outside of the crypto native user base in a mobile experience that they're used to. So, excited to be here. Thanks for having me.

Kain Warwick. I'm also a stablecoin founder, not as effectively as this guy, but I started Synthetix in 2017. Originally it was called Havven. It was a dollar-denominated stablecoin. We eventually pivoted into synthetic assets. So, we were one of the first to have synthetic equities, tokenized equities on chain, but we were a little too scared, and so we pulled the pin on it after about a year. And about 3 years ago I launched Infinex, which is a crypto app, super wallet, everything app that allows you to trade perps and spot and custody. It has a bunch of different features to kind of be everything that you need for your crypto life.

Awesome. So, the title of this panel is DeFi's institutional breakthrough, and I think what's kind of interesting, and we were chatting about this in the room before this, is we're actually seeing a lot of, you know, more traditional assets finding their way on chain, right? So, if you look at a lot of the growth for crypto over the past 6 to 12 months, you know, Hyperliquid's a great microcosm for this, where at one point half their entire trading book was RWAs that, you know, RWA perps that people want to trade. Stani, with you guys on Aave, increasingly you're seeing a lot of tokenized stocks, you know, finding product market fit. Guy, with respect to Ethena, you now have a lot of the collateral backing is shifted towards more traditional assets. And Kain, you guys have been supporting a lot of RWAs from sort of day one here. I'm curious, why now? In other words, what has sort of been the catalyst that you think has driven a lot of this growth and maybe Stani we can start with you.

It's well said. Guy, maybe similar question for you. What do you think has catalyzed this growth?

Yeah, I think it's an acceptance from institutional capital outside of the space that this is legitimate technology that's actually doing something to improve either the cost structure or distribution of their own products and businesses. So, if we look back even 3 years ago in the last sort of bear cycle in 2022 and 23, one interesting data point was actually total stablecoin supply I think came down around 40%. And if you remember back then, you had interest rates within crypto kind of collapse close to zero, but risk-free rates were paying 5% in the real world. And it was pretty insane that you couldn't actually just pick up a dollar that was sitting within crypto and just access the risk-free rate in TradFi. And so, you had this enormous like capital exodus from the system to just go and chase risk-free rates that sat outside of it. The interesting data point to me was this last bear cycle, I think total stablecoin supply was only down around 3-ish percent from the peak, which is pretty incredible for like a year-long bear market where a lot of things have been kind of shaken to the core. You've actually seen that capital came into the system and stayed there for the very first time in the last 10 years. And to me, that's a demonstration that we've actually done a pretty good job versus where we were 3 years ago in giving people a proper diverse set of other things they can be doing with their money other than being long Bitcoin basically when prices are going down. And so, I think we've seen, you know, the evolution of some of the tokenized equities that Stani was mentioning, but then also like the fixed income universe has expanded much beyond just tokenized T-bills, which is kind of where it started 2 years ago. And I think that that's the area where there's still a lot more to sort of come on chain where it feels quite underdeveloped versus the opportunity size that sits outside of it. I think the other piece is also just the nature and approach of founders and businesses in the space now acknowledging the fact that your business cannot just be levered to the crypto cycle to create like a durable business through time. And so, you know, the first applications in DeFi, the first iterations of those businesses or even centralized exchanges, really like the profile of the earnings of those businesses was just some derivative of what's happening to the price of Bitcoin or altcoins in the market. And I think the very best businesses now in crypto have found a way to untether themselves from just the cyclicality of crypto and tap into TradFi using technology within crypto that makes their business better. Whether it's the Hyperliquid example that you gave, you know, being able to pivot that business and benefit from the growth of derivatives on equities. And then, or even someone like Tether, for example, who doesn't care that much around where the price of altcoins are. They're just sort of clipping T-bill interest. So, I think that's just a trend you're going to continue seeing, which is crypto-native businesses taking the technology that they've applied to crypto assets and thinking about how do we make more durable businesses that aren't just reliant on the price of Bitcoin going up and down every 4 years.

Kain, anything you would add?

Yeah, I think the interesting thing for me is that, you know, we started out, especially in DeFi, right, early DeFi days, saying we're going to build this parallel, much more efficient financial system, right? In order to build that, we needed capital to come in so that we could invest in it. And, you know, the kind of solution to that was launching a bunch of tokens, right? So, you know, we launched ETHLend, you know, the LEND token before it became Aave. We launched SNX, we launched Maker, you know, there were a bunch of tokens that were launched to fund this infrastructure buildout to build this parallel, much more efficient system, which we built. But, as we were doing that, the investability of these assets started to kind of become more questionable, especially compared to TradFi assets, because you don't have the same guarantees, there's a lot more tail risk, it's a lot more speculative. And so, you know, we ended up building the rails for the system, financing it with, you know, tokens, and then the macro shift towards equities being far more investable has kind of forced us to use these rails to now facilitate equity transactions, tokenized equity transactions, which actually is fine, like it works really well, but it's kind of ended up with last cycle there not really being an alt season because altcoins were not really investable when you compared them to their equivalent, you know, TradFi asset that you could invest in. And so, I just think there's like a little bit of irony to the fact that we couldn't have built this parallel system without launching a bunch of tokens. And now having built it, we're using it to kind of make the system we're supposed to be replacing much more efficient. I think there is a solution to that, and I think people are working on it, you know, Robert Leshner, who's a friend of mine, is trying to kind of meld tokens and equity into this like single asset that will give tokens much more kind of certainty for investors in terms of how they'll behave and investor protections, etc. And I think when we land that, then we will have, you know, a much more kind of investable structure for tokens to be launched and for new businesses that are going to build the next wave of infrastructure to, you know, run on our rails, but also be crypto native. So, you know, there's still work to be done there, but I think that's kind of the most exciting thing for me is to see either existing tokens that become more equity-like and the headwinds for that unfortunately has been regulatory, right? And, you know, we didn't pass some of the laws that we were hoping to pass this year. But I think that eventually we will get sufficient regulatory clarity that we can make tokens more investable again and that will be, you know, kind of the next wave of like token adoption.

So you all alluded to some version of sort of that there is this latent demand for tokenized RWAs on chain. I think the next logical question is how do you address that latent demand and moreover, how do you actually capture that value? And I think an interesting through line among the three of you here is you've all increasingly tried to own the end user. Aave started as infrastructure, right? You recently launched Aave app, which is your consumer-facing app that owns the end user. Guy with Ethena, historically you were a stablecoin issuer. You recently launched Ethena Pay, right? And that's your attempt to sort of own the end user as well. Kain, you guys sort of from the start, although with Synthetix it was more infrastructure, but Infinex from the start was sort of, you know, a front end that aggregates, you know, a lot of different infrastructure on the back end. Maybe this time, Guy, we can start with you. What is the logic behind, you know, launching Ethena Pay and ultimately where do you see value accruing within the stack?

Yeah, for sure. I think it really was just a sequencing pace for us as we kind of went through the journey where in the beginning I would argue that we were actually direct to consumer where we had no integrations with any exchanges, no apps and like the first two billion dollars-ish that came into Ethena was actually just us going direct to consumers as we tried to scale in the beginning. And then there's a recognition that the number of users that are operating on chain and are willing to load up a MetaMask account and come and engage with a DeFi protocol is unfortunately in the thousands or hundreds of thousands, not in the tens of millions. And so I think just taking our learning from the success that you saw with Tether and Circle, the history of these products is that the success of them is always intricately linked with the willingness of large exchanges to push stablecoins. So, like, you know, the largest kind of holder and distribution platform for Tether is still Binance in terms of balances that are sitting there. The relationship between Coinbase and Circle has obviously been an incredible accelerant for Circle's business to get to the scale that they did. So, it's great if you want to get to that sort of like zero to one was you doing it direct, one to ten is trying to work with distribution platforms that they themselves own tens of millions, hundreds of millions of users on the other side. And I think Ethena did a pretty reasonable job in sort of 2 years in terms of getting into the important platforms that could move the needle down. And I think the final piece is a recognition that we don't want to be in a position in 3 to 5 years where the distribution of our products is entirely reliant on someone else's platform and business. And the reason for that is that your ability to extract margin as a business and actually price set on your end product can't always be determined by someone else basically if they own the end user on the other side. And so, we ideated on like what's the actual approach for us to try and make that step that gets closer to the user. And from our perspective, there were only really two options in terms of applications that could reach the scale of hundreds of millions of users that weren't sitting within crypto. It's kind of sort of a neo-brokerage or a trading application, or it's a money application where it's about saving, spending, and sending money. And I think the second category was much more in the DNA of things that we've done well historically, and we feel much more comfortable. We have like a structural edge to go and chase down. So, yeah, I think the core thesis for us was we want to be able to make more margin on the product. And if we can own the user within our own application on a mobile app, that was the best form factor for us to go and achieve that. And I do think broadly with these apps, it has become a pretty saturated space, I'd say, in the last like 2 to 3 years. Tends to happen in crypto, right? Which is you'll have someone has a good idea, and then there's kind of like a list of 100 people doing the same thing in a year. And you see the same thing with perp dexes, money markets, you know, stablecoins, etc. etc. But I think from our perspective we try to ask the question of like what is your reason to try and win this market versus other people that are out there? And I think being able to control the dollar with the highest structural yield at scale in the space is a very powerful tool for you to be able to attract and keep users within this app because everyone else is always struggling to compete with just a number that people care about a lot, which is how much of a yield you're getting as a savings rate within this app. And so that's the angle that we're trying to lean into the most. It's pretty nascent and new. It's only been out for like a month. I think we've only got like 3% of the users on the waitlist that are actually on there. But I think just very excited about our ability to try and chase down users who aren't just within this space. And to me this feels like the app, you know, people talk about 100 million users coming in and using these things. To me if you ask me the question of what would that app actually look like, it's something like this, which is just a savings account that everyone can access on the mobile phone. Yeah.

Kain, you kind of alluded to this sort of framework of neo-brokerage and money app and those seem to be the two categories. I would probably put you guys in with the neo-brokerage, you know, category. Maybe you can say more about why you've made this very intentional decision to not necessarily own the infrastructure itself and instead sort of become just a front end, you know, to aggregate a lot of the other existing infrastructure.