Umami Labs CEO Alex O’Donnell grew up on the outskirts of Philadelphia earlier than attending Temple College to review literature and economics. That path led him to commit seven years of his life as a monetary journalist at Reuters, the place he specialised in M&As IPOs.
He mentioned his educational focus created a “fairly pure synthesis” when it got here ot monetary journalism. Nevertheless, he mentioned he turned “disenchanted” along with his business whereas he was cooped up at residence throughout the Covid-19 pandemic. “There actually was a three-way alliance between journalists, authorities officers and expertise corporations making an attempt to manage the circulation of data,” O’Donnell mentioned in an interview with Cointelegraph.
He started tinkering with cryptocurrency, which led to his introduction with Umami DAO — and in the end his creation of Umami Labs.
O’Donnell and his spouse, Sanjana, are getting ready for a “third, smaller individual” to affix their household subsequent yr. Within the meantime, he mentioned he’s additionally gearing up for one more crypto-related enterprise. The main points aren’t absolutely public but, however he mentioned he plans to launch extra info the months forward.
1) How’d you make the transition from journalism to crypto?
I’d been a journalist for the higher a part of a decade primarily overlaying mergers and acquisitions. I all the time had an curiosity in finance and tech. However I began turning into a bit disenchanted with the mainstream media across the time of the pandemic. That was the primary time I began turning into a bit extra cynical about my very own business’s position within the info economic system. So I began paying extra consideration to points like privateness, censorship and different issues I had not taken as a lot curiosity in earlier than.
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his wedding in 2023.](https://cointelegraph.com/magazine/wp-content/uploads/2023/11/AOD-1024x989.jpg)
In 2020 I spent most of my time overlaying the Covid-19 pandemic. There actually was a three-way alliance between journalists, authorities officers and expertise corporations making an attempt to manage the circulation of data. It wasn’t even that the official line was fallacious. It was that dissent was being stifled within the first place. That actually peaked my curiosity in decentralized platforms.
At that time, I began to develop into meaningfully fascinated about crypto. Provided that I got here from monetary journalism, decentralized finance (DeFi) specifically caught my curiosity. I actually began actively investing in several crypto protocols as a retail investor in 2021. I used to be getting extra concerned in DeFi communities, and one in every of them was the predecessor to Umami — ZeroTwOhm.
2) How did that result in you creating Umami Labs?
I received concerned in ZeroTwOhm as a daily retail investor aping in as many individuals did. It was a reasonably small neighborhood, so I used to be capable of fairly shortly get in touch with the builders constructing the protocol.
However they didn’t actually have a transparent sense of course about what they needed to do subsequent. They’d bootstrapped a number of tens of millions of {dollars} in capital that was largely simply sitting there. It felt like someone wanted to step in, and the builders had been, frankly, more than pleased at hand duty off to another person, which ended up being me.
3) What are you targeted on now?
What I’m most fascinated about now could be zeroing in on an issue that turned very clear to me throughout my time at Umami. Primarily, as Umami Labs geared as much as launch our first product in early 2023, I used to be assembly with quite a lot of crypto-focused hedge funds and enormous particular person traders. There was this gaping want for some strategy to securely earn curiosity on USDC, USDT, and different stablecoins with out having to simply utterly transfer off-chain.
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I already targeted at Umami on growing one other product that was designed to generate returns on stablecoins, however the true want is for one thing that’s as safe and boring and dependable as a standard financial savings account, however for individuals who had been holding stablecoins on on-chain wallets. There have been forays into that space by different gamers, however I’ve but to see a whole answer to that downside. It takes a mix of getting the fitting regulated entities off-chain and seamless mechanisms for on- and off-ramping on-chain.
That’s one thing I’m personally targeted on now. I’m collaborating with some others on growing one thing, and getting suggestions from potential early customers. We’ll have extra particulars to share inside the subsequent couple of months. However for now, it’s nonetheless within the early phases.
4) What do you assume would be the greatest crypto traits in 2024?
In my private opinion, I do assume that the excessive level of the crypto market in 2021 actually was the high-water market of this period of very DIY, unregulated, type of community-run bootstrapped protocols. I believe that moving into subsequent years, together with now, we’re going to see a reasonably stark shift wherein DeFi stops trying a lot like a very separate ecosystem. It is going to for all intents and functions develop into a subset of TradFi.
Associated: Coinbase launches regulated crypto futures companies for US retail merchants
I don’t assume the DeFi versus TradFi distinction goes to final. Clearly, we’re seeing a variety of ETFs present process the registration course of. Within the background, main gamers are acquiring licenses to have interaction in a wider array of economic actions within the U.S. Coinbase, for instance has, registered as a Futures Fee Service provider and likewise as a Designated Contract Market with the CFTC. That authorizes them to function an trade and open accounts inside the futures markets. These will probably be focus, after all, on Bitcoin and Ether.
Coinbase and Circle are accumulating completely different elements that may permit them to develop into deeply built-in operators inside conventional finance. I believe that could be very fascinating. In parallel to that, you’ve people resembling Constancy and Franklin Templeton and BlackRock growing regulated crypto funding merchandise. Franklin Templeton is growing its personal tokenized Treasury Invoice ETF. It’s fairly clear that will probably be a supply of momentum for the business over the following a number of years.
5) What’s essentially the most fascinating to you as an funding proper now?
Actually, the one factor in crypto that I’m fascinated about as a long-term funding is Ether and its staking and re-staking derivatives. I believe we’re nonetheless at some extent the place the overwhelming majority of potential investments in crypto are extraordinarily speculative. The underlying worth proposition of the tokens continues to be unclear. I believe ETH is without doubt one of the few exceptions. So I do maintain ETH, and I’m comfy with it as a long-term funding.
I’m listening to the staking protocols like Lido and Eigen Layer. Eigen permits individuals to take ETH they’ve already staked and re-stake it to any variety of associated staking protocols. That very considerably expands the vary of actions that may be carried out trustlessly. I anticipate to see, over time, quite a lot of constructing on high of Eigen and different related protocols. I believe we’ll see a proliferation of funding funds and ETFs focusing on taking ETH and staking it and re-staking it.
6) What do you assume is the principle hurdle to mass adoption of blockchain expertise?
There must be a whole fusion of protocols on the bleeding fringe of blockchain, and extra established corporations which might be built-in into the normal monetary sector and able to working compliantly from a regulatory perspective. We have to see established gamers integrating subtle sensible contracts and taking full benefit of blockchain’s potential. Then we’ll begin to see blockchain turning into a part of on a regular basis monetary transactions and actions.
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