Guy Young, founder of Ethena Labs, has a simple explanation for why decentralized exchanges keep eating into the business of their centralized rivals. They are more efficient at doing the job.
Speaking on Delphi Digital’s Hivemind podcast in October 2026, Young pointed to the structural advantages DEXs hold over centralized exchanges (CEXs).
What Young actually argued
Young’s case rested on three pillars: execution, custody, and economics. In his telling, DEXs can execute trades better, handle custody in newer ways, and run on a slimmer cost structure.
The custody point is the one that stands out. On a centralized exchange, users hand their assets to the platform, which then holds them on its own books. On a DEX, trades settle through smart contracts, so users generally keep control of their funds until the swap happens.
The podcast discussion also touched on why builders find DEXs appealing. Composability, permissionless innovation, and lower operating costs came up as differentiators. CEXs, by contrast, have to manage excess capacity and shoulder centralized custodial obligations.
Composability means protocols can plug into one another like LEGO bricks. A lending app can tap a DEX’s liquidity without asking anyone’s permission. Centralized platforms tend to be walled gardens by design.
The data behind the shift
In May 2025, decentralized exchanges captured a record 25% share of global spot trading volume. That worked out to more than $410 billion in trades routed through on-chain venues in a single month.
Through 2026, the ratio of DEX to CEX trading bounced around but stayed in elevated territory. In Q2 2026, the trading ratio of the top 10 DEXs to CEXs sat at roughly 23.5%.
Perpetual DEX volumes held a share of around 2% in early 2024. By 2026, that share had climbed above 10%.
What is fueling the move on-chain
Memecoins played a big role. Many of these tokens launch on-chain long before any centralized exchange lists them, which forces eager traders to go where the action is.
Wallets have also gotten easier to use, lowering the barrier to entry. There is also the broader appetite to rely less on trust-based intermediaries.
On-chain activity on networks including Solana, Base, and Robinhood Chain added fuel. Each has given traders cheap, fast places to swap tokens without touching a centralized order book.
Why Ethena has skin in this game
Young is not a neutral observer here. Ethena’s flagship product, the USDe synthetic dollar, depends on access to deep trading venues.
USDe holds its value through delta-neutral hedging. Ethena holds crypto assets and simultaneously takes offsetting short positions, so gains and losses on one side cancel out the other. To run that strategy, Ethena uses both DEX and CEX venues.
USDe supply peaked at nearly $15 billion in 2025 before falling to approximately $4.9 billion as of late September or early October 2026.
Disclosure: This article was edited by John Chen. For more information on how we create and review content, see our Editorial Policy.