Umami Labs CEO Alex O’Donnell grew up on the outskirts of Philadelphia before attending Temple University to study literature and economics.That path led him to devote seven years of his life as a financial journalist at Reuters, where he specialized in M&As IPOs.
He said his academic focus created a “pretty natural synthesis” when it came ot financial journalism. However, he said he became “disenchanted” with his industry while he was cooped up at home during the Covid-19 pandemic. “There really was a three-way alliance between journalists, government officials and technology companies trying to control the flow of information,” O’Donnell said in an interview with Cointelegraph.
He began tinkering with cryptocurrency, which led to his introduction with Umami DAO — and ultimately his creation of Umami Labs.
O’Donnell and his wife, Sanjana, are preparing for a “third, smaller person” to join their family next year. In the meantime, he said he’s also gearing up for another crypto-related venture. The details aren’t fully public yet, but he said he plans to release more information the months ahead.
1) How’d you make the transition from journalism to crypto?
I’d been a journalist for the better part of a decade primarily covering mergers and acquisitions. I always had an interest in finance and tech. But I started becoming a bit disenchanted with the mainstream media around the time of the pandemic. That was the first time I started becoming a bit more cynical about my own industry’s role in the information economy. So I started paying more attention to issues like privacy, censorship and other things I had not taken as much interest in before.
In 2020 I spent most of my time covering the Covid-19 pandemic. There really was a three-way alliance between journalists, government officials and technology companies trying to control the flow of information. It wasn’t even that the official line was wrong. It was that dissent was being stifled in the first place. That really peaked my interest in decentralized platforms.
At that point, I started to become meaningfully interested in crypto. Given that I came from financial journalism, decentralized finance (DeFi) in particular caught my interest. I really started actively investing in different crypto protocols as a retail investor in 2021. I was getting more involved in DeFi communities, and one of them was the predecessor to Umami — ZeroTwOhm.
2) How did that lead to you creating Umami Labs?
I got involved in ZeroTwOhm as a regular retail investor aping in as many people did. It was a pretty small community, so I was able to pretty quickly get in contact with the developers building the protocol.
But they didn’t really have a clear sense of direction about what they wanted to do next. They had bootstrapped several millions of dollars in capital that was largely just sitting there. It felt like somebody needed to step in, and the developers were, frankly, more than happy to hand responsibility off to someone else, which ended up being me.
3) What are you focused on now?
What I’m most interested in now is zeroing in on a problem that became very clear to me during my time at Umami. Essentially, as Umami Labs geared up to launch our first product in early 2023, I was meeting with a lot of crypto-focused hedge funds and large individual investors. There was this gaping need for some way to securely earn interest on USDC, USDT, and other stablecoins without having to just completely move off-chain.
I already focused at Umami on developing another product that was designed to generate returns on stablecoins, but the real need is for something that is as secure and boring and reliable as a conventional savings account, but for people who were holding stablecoins on on-chain wallets. There have been forays into that area by other players, but I have yet to see a complete solution to that problem. It takes a combination of having the right regulated entities off-chain and seamless mechanisms for on- and off-ramping on-chain.
That is something I’m personally focused on now. I’m collaborating with some others on developing something, and getting feedback from potential early users. We’ll have more details to share within the next couple of months. But for now, it’s still in the early stages.
4) What do you think will be the biggest crypto trends in 2024?
In my personal opinion, I do think that the high point of the crypto market in 2021 really was the high-water market of this era of very DIY, unregulated, sort of community-run bootstrapped protocols. I think that going in subsequent years, including now, we’re going to see a pretty stark shift in which DeFi stops looking so much like a completely separate ecosystem. It will for all intents and purposes become a subset of TradFi.
I don’t think the DeFi versus TradFi distinction is going to last. Obviously, we’re seeing a number of ETFs undergoing the registration process. In the background, major players are obtaining licenses to engage in a wider array of financial activities in the U.S. Coinbase, for example has, registered as a Futures Commission Merchant and also as a Designated Contract Market with the CFTC. That authorizes them to operate an exchange and open accounts within the futures markets. Those will be focus, of course, on Bitcoin and Ether.
Coinbase and Circle are accumulating different components that will allow them to become deeply integrated operators within traditional finance. I think that is very interesting. In parallel to that, you have folks such as Fidelity and Franklin Templeton and BlackRock developing regulated crypto investment products. Franklin Templeton is developing its own tokenized Treasury Bill ETF. It’s pretty clear that will be a source of momentum for the industry over the next several years.
5) What’s the most interesting to you as an investment right now?
Really, the only thing in crypto that I’m interested in as a long-term investment is Ether and its staking and re-staking derivatives. I think we’re still at a point where the vast majority of potential investments in crypto are extremely speculative. The underlying value proposition of the tokens is still unclear. I think ETH is one of the few exceptions. So I do hold ETH, and I’m comfortable with it as a long-term investment.
I’m paying attention to the staking protocols like Lido and Eigen Layer. Eigen allows people to take ETH they’ve already staked and re-stake it to any number of related staking protocols. That very significantly expands the range of activities that can be done trustlessly. I expect to see, over time, a lot of building on top of Eigen and other similar protocols. I think we’ll see a proliferation of investment funds and ETFs that specialize in taking ETH and staking it and re-staking it.
6) What do you think is the main hurdle to mass adoption of blockchain technology?
There needs to be a complete fusion of protocols on the bleeding edge of blockchain, and more established companies that are integrated into the traditional financial sector and capable of operating compliantly from a regulatory perspective. We need to see established players integrating sophisticated smart contracts and taking full advantage of blockchain’s potential. Then we’ll start to see blockchain becoming part of everyday financial transactions and activities.
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Angela Rayner has promised to bring Labour’s flagship workers’ rights bill to parliament next month as she told her party’s conference: “Things can get better if we make the right choices.”
The government has faced criticism in recent weeks over its pessimistic messaging around the economy, with Prime Minister Sir Keir Starmer warning October’s Budget would be “painful” in order to deal with the £22bn “black hole” he claims was left by the Conservatives.
But while his deputy said the party “can’t wish our problems away”, she said “hope won” when Labour achieved its landslide at the last election, adding: “Change has begun.”
Speaking on the conference floor on the first full day of Labour’s annual gathering, Ms Rayner said: “Let me be blunt. We can’t wish our problems away. We have to face them. That’s the difference between opposition and government.
“But… things can get better if we make the right choices. Sustained economic growth is the only way to improve the lives of working people, and we’re fixing the foundations to put Britain back on the path to growth. No more talking, but doing.”
The deputy prime minister reiterated her party’s plans to improve renters’ rights, including ending no-fault evictions “for good”, as well as promising a “devolution revolution” in the north of England, and the “biggest boost to social and affordable housing in a generation”.
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But some of the biggest cheers from delegates came over her long-trailed plan to increase workers’ rights across the country, with her promising to bring the Employment Rights Bill to the Commons in October.
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Concerns have been raised over the legislation by some in the business community, with an Institute of Directors’ survey earlier this month citing the bill as a reason for pessimism among firms who fear the impact on their operations.
Championing the bill, Ms Rayner said: “They said we couldn’t do it. Some tried to stop it in its tracks. But after years of opposition, we are on the verge of historic legislation to make work more secure, make it more family friendly, go further and faster to close the gender pay gap, ensure rights are enforced and trade unions are strengthened.
“That means repealing the Tories’ anti-worker laws and new rights for union reps too. A genuine living wage and sick pay for the lowest earners, banning exploitative zero-hour contracts and unpaid internships, ending fire and rehire. And we will bring in basic rights from day one on the job.
“This is our plan to make work pay, and it’s coming to a workplace near you.”
Concluding her speech, the deputy prime minister said: “On 4 July, the people entrusted us with the task of change and hope won. Now is our moment, not just to say, but to do.
“Labour governments of the past took on this same challenge at a time when Britain desperately needed change. They delivered a better Britain when the odds were stacked against them.
“And that is exactly what this Labour government must deliver once again. So conference, let’s get on with it.”
Angela Rayner will set out measures to protect renters from fire safety defects, damp and mould in her speech at the Labour Party conference.
The deputy prime minister, who is also the housing secretary, will commit to “building homes fit for the future” when she opens the party’s first annual gathering since winning the general election.
The package will include bringing forward a Remediation Acceleration Plan this autumn to speed up the removal of unsafe cladding on high-rise buildings.
Deadly cladding remains on more than half of all residential blocks of flats identified as at risk since the Grenfell fire in 2017.
The issue has come back into the spotlight following the conclusion of the inquiry into the tragedy, which found that “systematic dishonesty” contributed to the blaze that killed 72 people.
The announcement of the acceleration plan was thin on detail, but the government said it would go “further and faster to fix unsafe cladding and make existing homes safe”.
Other measures Ms Rayner will announce on Sunday include consulting on a new “decent homes standard” for the social and private rented sectors, and a new law to make landlords respond to complaints about disrepair within legally binding timescales.
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These have already been announced as part of Labour’s Renters’ Rights Bill, which builds on long-awaited legislation that was promised by the Tories but ultimately shelved ahead of the general election.
The law regarding repairs will be named after two-year-old Awaab Ishak, who died as a direct result of exposure to mould in the social home his family rented in Rochdale, Greater Manchester.
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The Conservatives first proposed Awaab’s Law to cover the social rented sector, but Labour will extend it to cover the private sector in a move they say will help tenants in 746,000 homes with reported serious hazards secure faster repairs.
“We will deliver for working people and, in doing so, show that politics can change lives.
“This Labour government is taking a wave of bold action to not only build the housing our country needs and boost social and affordable housing, but to ensure all homes are decent, safe, and warm.”
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‘All MPs take gifts and donations’
The speech comes as a donations row threatens to overshadow the optimistic mood of the party’s first conference while in government for 15 years.
The prime minister has come under scrutiny over the past week for the more than £100,000 worth of gifts he has accepted, including tickets to football matches, concerts and luxury clothes.
Following days of press coverage on the issue, it emerged on Friday that Sir Keir and his most senior ministers – Ms Rayner and Chancellor Rachel Reeves – will no longer accept donations to pay for clothes.
She defended the prime minister’s actions as being within the rules, saying that the taxpayer doesn’t fund these things “so MPs will always take donations, will always take gifts in kind”.
She added: “We expect our politicians to be well turned out, we expect them to be people who go out and represent us at different events and represent the country at different events and are clothed appropriately.
“But the point is that when we accept donations for that or for anything else, that we declare them and we’re open and transparent about them.”