The Ethena Foundation has initiated a vote on a radical change to the economics of its governance token, ENA. The proposal involves directing nearly all of the ecosystem's net revenue toward a programmatic buyback of the asset from the open market. This is not just an adjustment—it is a paradigm shift in how value is distributed within the protocol.
Revenue Re-engineering
The core of the initiative is a "fee switch." Instead of distributing income among sUSDe holders and partner programs, as was previously the case, all cash flow from Ethena's products, including the USDe stablecoin, will be converted into market purchases of ENA. The risk committee has already approved the proposal, and voting has been launched on Snapshot. However, the team has not yet disclosed the timeline or provided guarantees that the new model will be adopted.
Consolidation of Power and Intellectual Property
In parallel, Ethena Labs and the Ethena Foundation have signed a Master Framework Agreement. Under the terms of the agreement, all of the protocol's intellectual property and rights to generated value transfer exclusively to the Foundation's control. Management of these assets will be carried out by ENA holders through governance mechanisms. A key nuance: under the new agreement, Ethena Labs investors lose residual rights to the project's cash flows, sharply reducing their influence over long-term monetary policy.
Eliminating the Sword of Damocles of Unlocks
A separate block of updates concerns tokenomics. The Foundation and leading venture investors have agreed to cancel future monthly unlocks for their category of tokens. Recall that investors accounted for 25% of the fixed ENA supply—that's 3.75 billion coins. The original schedule included a one-year cliff and a three-year vesting period. Now, unlocked assets belonging to investors who agreed to the new scheme are removed from the schedule. Team tokens will continue to be released according to the old timeline.
Moreover, the Foundation has announced the buyback of remaining locked ENA from several major seed investors who had been selling assets over the past nine months. The details of the deal have not been disclosed, but the very fact indicates a drive to consolidate control.
Market Analysis
The market reaction was swift: over the past day, the ENA price rose nearly 12% to $0.16. For comparison, the all-time high in April 2024 was $1.5. The current market capitalization is $1.54 billion, and TVL on Ethena stands at $4.5 billion, of which ~$4 billion is in USDe.
It's worth noting the context: in August 2025, USDe entered the top three largest stablecoins, but within three months its supply collapsed by more than 50% due to falling yields.
My professional take: this is an ambitious attempt to solve two fundamental problems for ENA—creating sustainable demand through buybacks and eliminating structural pressure from future unlocks. However, concentrating intellectual property and cash flows in the hands of the Foundation, even under governance control, carries risks of centralization. In the long term, success will depend on whether the community can effectively manage these assets without losing the decentralization that is the cornerstone of trust in the protocol.