Ethena Proposes 95% Revenue Allocation for ENA Buybacks
Key Facts
In a move aimed at enhancing token holder value and refining tokenomic structures, the Ethena Foundation has proposed allocating 95% of its net business revenue toward ENA buybacks. The activation of this proposal is contingent on the USDe stablecoin supply reaching a $7.5 billion milestone, reflecting a strategy to link protocol growth directly to token purchasing power. Additionally, the proposal includes ending monthly investor token unlocks and separating ecosystem economics from Ethena Labs equity to mitigate future sell pressure.
These developments come as ENA reacted sharply to the announcement, rising approximately 23% over 24 hours to around $0.17 according to reports. The proposal marks a significant shift from previous periods, as USDe supply has currently fallen below $5 billion from a peak near $15 billion in October. Per market data, the proposed program seeks to replicate previous buyback successes where significant allocations were made as protocol revenue and supply climbed during expansionary phases.
Looking ahead, traders are monitoring USDe supply levels as the primary catalyst for the commencement of programmatic buybacks. Furthermore, the upcoming economic calendar shows no immediate crypto-specific catalysts, leaving the narrative driven by internal governance developments within the Ethena ecosystem.
Latest Updates · 3
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Update: Ethena has also revealed a strategic pivot to diversify its yield sources by utilizing equity perpetuals, moving beyond its exclusive reliance on crypto derivatives. According to company projections, real-world assets (RWA) are expected to become the primary backing for the USDe stablecoin within the next two years, aiming to bolster the protocol's long-term stability.
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Update: Ethena has expanded the backing mechanism for its USDe stablecoin to include equity perpetual futures, diversifying its yield and collateral base beyond traditional crypto assets. According to reports, the open interest for these equity perpetuals has reached $6 billion, strengthening the protocol's ability to scale toward the supply milestones required to activate the proposed ENA buyback program.
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Update: The proposal has moved toward implementation as the Foundation officially submitted the "fee switch" activation for a formal governance vote. Additionally, reports indicate that the Ethena Foundation actively intervened to buy out stakes from seed investors who had sold their ENA tokens to mitigate market sell pressure, with only one wallet reportedly declining the buyout offer.