Ethena has proposed directing 95% of net revenue from its branded businesses toward ENA buybacks once USDe supply reaches $7.5 billion, as the protocol also moves to end monthly investor unlocks and separate ecosystem economics from Ethena Labs equity.
Summary
- Ethena has proposed using 95% of net revenue for ENA purchases once USDe supply reaches the first $7.5 billion threshold.
- The Ethena Foundation has bought locked ENA from some seed investors and plans to accelerate the remaining original investor unlocks.
- ENA rose about 23% over 24 hours to $0.17 and has roughly doubled in a little more than a week.
- USDe supply remains below $5 billion after falling from a peak near $15 billion in October.
- Ethena has expanded into institutional credit and distribution deals as it looks for revenue sources beyond crypto funding rates.
According to the Ethena Foundation, the proposed changes are designed to address two long-running issues around ENA: recurring supply from early investor unlocks and uncertainty over how the protocol’s economic value reaches token holders.
The overhaul combines changes to the token’s supply schedule with a proposed fee switch that could create recurring market purchases of ENA. It also sets out a planned agreement under which most of the intellectual property and economic benefits tied to the Ethena protocol would sit with the foundation and ecosystem rather than shareholders in Ethena Labs.
ENA reacted sharply to the announcement, rising about 23% over the past 24 hours to around $0.17. The token has roughly doubled in a little more than a week, extending gains recorded during the latest crypto market rally.
ENA buybacks could receive 95% of net revenue
Under the governance proposal, ENA holders are voting on a fee switch that would link token purchases to the size of USDe’s circulating supply.
Once USDe reaches the first threshold of $7.5 billion, 95% of net revenue generated by Ethena-branded businesses would be allocated to programmatic ENA purchases. The remaining 5% would be retained to fund ecosystem growth.
Buybacks would then increase as USDe circulation reaches additional milestones, creating a mechanism through which growth in Ethena’s businesses could translate into demand for ENA.
The proposal addresses a question that has followed governance tokens across decentralized finance: whether revenue generated by a protocol ultimately produces economic benefits for the token itself. In Ethena’s case, the proposed structure would use revenue for open-market ENA demand rather than leaving the connection dependent mainly on governance rights or expectations of future utility.
The idea is not Ethena’s first use of token repurchases. In August 2025, crypto.news reported on ENA buybacks when a $260 million program was allocating about $5 million per day toward token purchases as USDe supply and protocol revenue climbed.
The latest proposal differs by tying purchases to recurring net revenue and predetermined USDe supply thresholds rather than relying only on a fixed pool of capital.
Ethena moves to remove the ENA unlock overhang
Alongside the revenue proposal, the Ethena Foundation said it had purchased the remaining locked tokens belonging to certain large seed investors that had been selling ENA during the previous nine months.
Remaining original investor allocations will also be unlocked on an accelerated schedule, bringing the monthly release of venture investor tokens to an end. Tokens allocated to the Ethena team will continue under their existing vesting schedules.
Ending the monthly investor releases changes when the remaining supply enters circulation rather than removing those tokens entirely. The foundation’s purchase of locked allocations from some seed investors, however, removes those holdings from investors who had previously been selling ENA.
Token unlocks have affected ENA trading before. In June 2025, an unlock of roughly 41 million ENA, worth more than $12 million at the time, produced only a limited market reaction, with the token falling about 1% during the day.
More recently, the supply picture has become important as ENA’s institutional ownership has expanded. Grayscale Investments added ENA to its Decentralized Finance Fund during its first-quarter 2026 rebalance, selling other fund components to finance the purchase.
Another source of U.S. market exposure arrived in June when StablecoinX completed its merger with TLGY Acquisition Corp. and began trading on Nasdaq under the ticker USDE. The company held about 3.029 billion ENA, valued at roughly $275 million using the 30-day average price cited around the transaction, giving public-market investors exposure to a business built around the Ethena ecosystem.
Ethena seeks clearer ownership of protocol economics
A separate part of the overhaul deals with the relationship between Ethena Labs, the foundation and ENA holders.
Under an agreement in principle described by the foundation, substantially all material intellectual property and economic upside associated with the Ethena protocol would belong to the foundation and ecosystem rather than holders of equity in Ethena Labs.
The parties expect to publish the agreement in October.
Formalizing that division could clarify which economic interests belong to shareholders in the development company and which remain with the token-governed ecosystem. The foundation presented the arrangement alongside the buyback proposal and investor unlock changes rather than as a standalone corporate restructuring.
Institutional involvement in ENA has increased during 2026. Coinbase Ventures bought ENA on the open market in June rather than receiving tokens through a discounted private allocation, while Coinbase and Ethena announced plans to develop onchain finance and savings products.
As previously covered in June, Ethena did not disclose the number of ENA tokens Coinbase Ventures purchased, its average acquisition price, or wallet addresses associated with the transaction.
A first product from the relationship arrived later that month when Coinbase introduced a high-yield USDC vault using Morpho infrastructure and allocations curated by Steakhouse Financial. The product included Ethena-related assets in its collateral structure and allowed users to access the vault through Coinbase’s application.
USDe supply remains far below its peak
While ENA has rallied, Ethena is still working to rebuild demand for USDe after a steep contraction from its 2025 highs.
USDe supply has fallen below $5 billion from a peak of nearly $15 billion in October. The decline followed weaker conditions in crypto derivatives markets, where funding rates form an important part of the strategy Ethena uses to generate returns.
USDe differs from reserve-backed stablecoins because Ethena uses collateral alongside derivatives positions to maintain its dollar exposure. Returns available from that structure can therefore change as derivatives funding conditions move.
During the previous expansion, USDe had reached $11.7 billion in supply by August 2025, while Ethena reported more than $500 million in cumulative gross interest revenue. Weekly protocol revenue was $13.4 million at the time, alongside $670 million of USDe mints.
By June 2026, however, the decline in USDe supply was already visible as Ethena pursued institutional distribution and new uses for its capital.
One route has been traditional asset management. Janus Henderson invested in ENA in June and began exploring ways to use USDe for treasury management and to distribute it through investment products. The asset manager oversaw roughly $480 billion at the time of the agreement.
Ethena also planned a $250 million allocation to Securitize’s tokenized AAA-rated collateralized loan obligation fund when the product expanded to Solana in June. The fund invests in U.S. dollar-denominated AAA-rated CLO tranches, with BNY serving as custodian and sub-adviser. The planned allocation provided another route for Ethena capital into traditional credit markets.
Institutional access expanded again later in June when BlackRock integrated USDe into its Aladdin investment and risk-management platform. The Aladdin integration gave institutions using the system access to USDe through existing workflows, while the announcement was accompanied by plans for a $100 million liquidity facility connected to BlackRock’s tokenized BUIDL money-market fund.
New credit facility reduces reliance on crypto funding rates
Ethena added another source of potential yield in August through a $1 billion facility with institutional crypto prime broker FalconX.
Announced on Aug. 19, the warehouse facility allows assets backing USDe to be deployed into overcollateralized institutional loans. The arrangement gives Ethena a source of returns outside the crypto derivatives funding-rate trades that have historically formed a central part of USDe’s yield model.
The announcement also contributed to ENA’s recent price strength. Days after the FalconX deal, ENA had climbed 48% as several altcoins outperformed Bitcoin, although CoinDesk reported that market-wide measures did not yet indicate a general altcoin season.
Meanwhile, Coinbase has already provided a U.S.-facing distribution channel for Ethena-linked products. Its high-yield USDC vault launched in June through Morpho and Steakhouse Financial, with Ethena-related assets included in the collateral framework. The Coinbase vault is accessible from the exchange’s consumer application, while the underlying lending activity runs through onchain infrastructure.
Janus Henderson’s involvement has added another institutional route. Along with investing in ENA, the asset manager has explored USDe distribution through investment products, according to the June announcement.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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