The Ethena Market: Part 1 This is undoubtedly the most advanced market we have ever designed. It layers exciting new features on top of the battle tested lending and oracle engines in a design that is simply miles ahead of anywhere else. The trade is simple: loop USDe with USDG, pocket the spread for as long as possible and minimise all the other costs: * Bad liquidations due to secondary market volatility * Bad trade economics: high entry costs due to slippage and price impact, interest rate spikes eating up yield * Adverse selection: lending against hacked double/minted tokens, rehypothecation Each of them have layers of measures (some of many): ✅ Liquidations are permissioned ✅ Oracles: USDE is capped at 1, anchored to USDT, floored at 0.98 with circuit breaker when secondary market diverges (hacks, depeg trigger), USDG is capped at 1, floored at 0.97 ✅ Curve is flat and actively managed: rate spikes will not appear in normal course of daily operations. It's critical to understand: **the market setup has to fit the trade**, especially when trade is so custom Bad tooling and you end up overpaying, risk managers cannot operate, users worry. More to come.