12th May 2026 > > Ethena, Arthur Hayes, & the CLARITY Act.
- 11 hours ago
- 3 min read
tl;dr
Ethena and all its flaws. Arthur Hayes calls it. The CLARITY Act is still dead and buried.
Market Snap
Market Wrap
Charles Schwab is recommending that clients put 2-7% of their investments into BTC which aligns with my long-held belief that 5% of all investment monies will flow into cryptos, almost entirely into BTC.
Curious Cryptos’ Commentary – Ethena
The CCC has long been sceptical about the Ethena ecosystem, and for one very good reason.
At the heart is an algorithmic stablecoin. I am sure everyone remembers the golden rule about such financial chicanery – all algorithmic stablecoins are destined to burn and die. The CCC has never given financial advice, and we are not about to start now. But I think I can fairly point out that in the CC Treasury investment guidelines is a blanket ban on anything Ethena related.
I have found this new analysis:
The headline is “15 ways Ethena can have a fund loss”.
It is a damning tale of problems created, accidentally or otherwise, within the Ethena ecosystem:
“Onchain admin risks, protocol design, operational failure or external dependencies, there are many ways in which this protocol could lose funds.”
If you are involved in Ethena I suggest you have a long look at this long list of faults. It is very apparent that there is a huge degree of centralisation, enough to call into question whether it should be described as part of the crypto revolution at all.
Curious Cryptos’ Commentary – Arthur Hayes
Arthur’s latest musings were published today:
As always, it is worth a read. His core message is that he is calling the end of the bear market – he isn’t the only one to be fair – with this startling claim:
“The bull market began in earnest when the US attacked Iran on February 28th.”
Nice.
His reasoning circles back to the ongoing and never-ending fiat money printing that will be required to fund the massive amounts of investment in building out A.I. and the need to expand the Fed’s balance sheet once more:
With mid-terms rapidly approaching, juicing of the financial markets by the Fed responding as always to the demands of its political masters all but guarantees a rosy outlook for BTC from here on in.
Curious Cryptos’ Commentary – The CLARITY Act
Fresh from the CCC’s prediction that hopes for the CLARITY Act have been dashed, the Senate Banking Committee has released the latest version in the last few hours for debate this week:
Chairman Tim Scott had this to say:
"This bill reflects serious, good-faith work across the committee and delivers the certainty, safeguards, and accountability Americans deserve. It puts consumers first, combats illicit finance, cracks down on criminals and foreign adversaries and keeps the future of finance here in the United States."
This is all well and good, but they key problem remains – the demand for an ethics provision by Senator Elizabeth Warren targeting the Trump family interest in cryptos:
"This bill puts investors, our national security and our entire financial system at risk — and it will turbocharge Donald Trump’s crypto corruption. In just one year in office, the president and his family have raked in at least $1.4 billion in gains from crypto deals alone, and yet this bill stunningly includes zero provisions to prevent that."
You can certainly find yourself in the deeply unfamiliar, and frankly disturbing, position of agreeing with Warren for the very first time ever, but that doesn’t change the fact that Trump will not sign a bill into law that is at least partially motivated by wanting to restrict his family’s business affairs.
Progress can only be made if at least ten Democratic senators do not agree with Warren, and that therefore the Senate passes the bill without an ethics provision. That still looks an insurmountable obstacle to me.
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