Ethena Advances Revenue-Funded Token Buybacks as ENA Surges Past $0.17
The Ethena Foundation's proposal to direct 95% of protocol revenue toward ENA token repurchases has triggered double-digit gains, with voting set to conclude September 2.
Revenue-Funded Buyback Plan
The Ethena Foundation has moved forward with significant tokenomics changes, including a proposal to redirect most protocol revenue toward repurchasing ENA tokens from the market. This announcement triggered substantial gains for the ENA token, which climbed over 10% in the past day and has appreciated significantly over the week.
Under the proposed fee-switch structure, 95% of net revenues generated by Ethena’s operations would be allocated to purchasing ENA tokens, once the USDe stablecoin reaches a circulating supply of $7.5 billion. The community has until September 2 to vote on this proposal through Snapshot, with early voting showing unanimous support from the 14.4 million ENA currently participating in the vote.
Token Price Action and Investor Realignment
The ENA token itself reached prices above $0.17 following the announcement, reflecting investor enthusiasm for the buyback mechanism. The token’s 27% weekly appreciation underscores growing confidence in Ethena’s ability to create sustainable token value through protocol revenues.
The Foundation also finalized buyback transactions for locked tokens from early-stage investors who had opted to sell portions of their holdings during the past nine months. Additionally, the Foundation restructured the remaining unvested allocations for lead investors, choosing to accelerate releases on October 5 instead of maintaining the previous monthly vesting schedule. This change resolves the investor unlock period more quickly while preserving the team’s original vesting arrangements.
Market Position and Strategic Backing
Ethena’s flagship product, the USDe stablecoin, has established itself as a significant player in the stablecoin market. With a $4 billion market capitalization, USDe ranks as the sixth-largest stablecoin across decentralized finance platforms. The project has attracted institutional backing, including a $20 million strategic investment from M2 Capital, the investment division of UAE-based conglomerate M2 Holdings, which also maintains stakes in other blockchain projects including the Sui Foundation.
A protocol directing substantial revenue toward token buybacks creates a direct economic incentive for holders while reducing circulating supply pressure—a pattern gaining traction across the industry.
Source: Ethena Foundation, via Cointelegraph. Not financial advice.