Over the past eight years, I have been completely immersed in the crypto industry. What started as an academic interest has grown into a professional career. If you’ve gone down the crypto rabbit hole, then you probably also love the constant learning, being surrounded by experts in many different facets of the industry and seeing beliefs held almost a decade ago mature into reality. 

It all began in 2018 with my Masters thesis on Bitcoin’s price volatility by correlating onchain activity of whales to large price movements. In hindsight, the research methodology was extremely crude but it was a pivotal first step in becoming infatuated with Bitcoin and the crypto industry.

That research paper landed me a job as an Economist at the Bank of Canada. I spent most of my time analyzing cash use and payment systems but my research interests went deeper and deeper into crypto. Back then, my anonymous twitter account was providing real-time insights that most of my central banking colleagues wouldn’t discover for weeks or months. It was exhilarating to grow into a leading expert on crypto at Canada’s central bank in my early 20s.

Looking back, the timing couldn’t have been better. The first major event was the crash of QuadrigaCX, which really caught the attention of Canadian regulators. They knew something clearly bad had happened but few understood crypto well enough to trace onchain transactions and piece together the inner workings of a crypto exchange. Next came a major round of Quantitative Easing following COVID19 and the economy crashing. These actions by central banks globally really cemented my views on the debasement of money and belief in Bitcoin as a scarce digital store of value. Finally, the flash crash of March 12th, 2020 on BitMEX got me really fascinated with crypto derivatives, market infrastructure and centralized exchanges. I began to uncover the degree of vertical integration of CEXes that simply doesn’t exist in TradFi. CEXes typically had every responsibility, including onboarding, custody, execution, clearing and settlement whereas in TradFi there are brokers, exchanges, clearing houses, central banks and other institutions.

By 2021, I had enough passive research and wanted to dive head first into the world of crypto derivatives and CEXes. I heard about an up and coming exchange that recently raised a seed round from Three Arrows Capital. Hearing Su Zhu speak about WOO on UpOnly and became fascinated by its unique approach to liquidity. The backing of a leading crypto hedge fund in Kronos Research, combined with joining a young, fast growing company drew me in. This led to many late night and early morning meetings being the only team member in the Western Hemisphere. As I rose to becoming the Co-Head of Ecosystem at WOO, I was able to learn so much as we worked towards building a full-service offshore CEX in WOO X, as well as a spot and perp DEX in WOOFi and WOOFi Pro.

Throughout my 4 years at WOO, we enjoyed many successes and difficult setbacks. I got to experience the 2021 bull market through the lens of CEX and the process of raising a $40M Series A. Shortly after, we survived through the blow up of Luna, 3AC and FTX. There were also multiple hacks across both our CEX and spot DEX, where I saw what it took to act swiftly with professionalism and transparency. I got to travel the world across Warsaw, Singapore, Taipei, Bangkok, Dubai, Austin, Denver and London. I made lifelong friends that I remain extremely grateful for. 

By the end of 2024, I had stopped growing as much as I had early on and wanted to explore a new opportunity. This led me to reflect on what I found interesting and enjoyed using in the crypto industry. Aside from perpetual futures, stablecoins were clearly the most innovative product built. The relentless growth and countless data points of institutional adoption of stablecoins were signs of further opportunity ahead. However, stablecoins have a glaring deficiency, that all of the yield generated by the reserves go to the issuers. There was a clear opportunity cost of holding stablecoins, especially against the backdrop of high price inflation globally. At the same time, the growing success of projects like Ethena and Maple Finance pointed to a new asset class in crypto. Some referred to these tokens as Yield-Bearing Stablecoins (YBS) but clearly these tokens are not stablecoins, as Stream Finance, Elixir and others have recently demonstrated.

So after months of reflecting and research, I began building Sierra alongside the OpenTrade team. It was envisioned as a product I’d love to use. Passively earning yield across DeFi and RWAs, powered by stablecoins and wrapped in an extremely simple user experience that's underpinned by transparency. Simple to integrate with many popular CeFi and DeFi platforms, offering tons of utility and ways to enhance yield. 

After our recent launch, SIERRA represents a new form of money, far removed from hidden fees, banking delays and price inflation. Instead, SIERRA is universally accessible, self-custodial, transparent and growing in value through intrinsic yield. By holding SIERRA, you passively earn industry-leading yield, compounded daily without any lock-ups, hidden fees, or requirements to stake or claim rewards.

We refer to SIERRA as a Liquid Yield Token (LYT) and explicitly not a stablecoin or YBS. This is because SIERRA does not aim to maintain a fixed price to a fiat currency. On the contrary, it gradually appreciates as yield accrues to SIERRA holders. We believe that LYTs represent an exciting vertical in crypto that are built on top of stablecoins. Typical features of LYTs include stablecoin-denominated reserves backing the LYT and a liquid secondary market to buy and sell LYTs, in contrast with DeFi yield vaults where funds are locked in smart contracts. Many projects you’re familiar with will likely call themselves LYTs as the industry moves away from the YBS terminology.

I truly believe that crypto is one of the most rewarding and challenging spaces to work in. Your beliefs and convictions are constantly challenged. Despite that, innovation moves at an unrelenting pace and the composability of DeFi makes new products and applications possible that would be unimaginable in TradFi. I’m excited to work towards building SIERRA into a product that millions of users love and achieving our ultimate goal of reimagining money. I’m confident that contributing to Sierra represents the most rewarding and challenging next step in my crypto journey and I hope you come along for the ride.

Mitchell Nicholson,

Core Contributor at Sierra