The Ethena Foundation has initiated a vote on a radical change to the ecosystem's revenue distribution model. The proposal involves directing nearly all net revenue toward programmatic buybacks of the governance token ENA. This is a step that could fundamentally reshape how the market perceives the asset and its long-term dynamics.
In parallel, the project is revising the ownership structure of protocol value and aims to reduce future selling pressure on the price from investor unlocks. The initiative has already received approval from the Risk Committee and has been submitted to the Snapshot platform for community voting.
All Revenue Goes to Buybacks
The essence of the proposal is a "fee switch": instead of distributing income across ecosystem streams, as was done previously (e.g., rewards for sUSDe holders and partner programs), all net proceeds from Ethena's products will be directed toward market purchases of ENA. This creates direct and sustained demand for the token, which in theory should support its price.
However, Ethena has not disclosed the exact voting timeline, and there is no guarantee the model will be adopted in its current form. Nevertheless, the signal itself is highly telling.
The Foundation Consolidates Protocol Value
Separately, Ethena Labs and the Ethena Foundation have entered into a Master Framework Agreement, under which the protocol's intellectual property and rights to generated value transfer exclusively to the organization. Management of these assets will henceforth be carried out by ENA holders through governance mechanisms. This means that Ethena Labs investors lose residual rights to cash flows, strengthening the position of token holders.
Investors Forgo Future Unlocks
A key point for tokenomics is the agreement with major venture investors to cancel future monthly unlocks of their tokens. This category accounted for 25% of ENA's fixed supply (3.75 billion coins) with a one-year cliff followed by a three-year vesting period. Now, the unlocked assets of investors who agreed to the new scheme will be excluded from the schedule. Team tokens will continue to vest according to the original timeline.
Additionally, the Foundation announced the buyback of remaining locked ENA from several major early investors who had been selling tokens over the past nine months. Details of the deal have not been disclosed.
Thus, Ethena is simultaneously addressing two key issues: creating sustainable demand through buybacks and eliminating potential pressure from future unlocks. Against this backdrop, the price of ENA rose nearly 12% in a day, reaching $0.16. For comparison, in April 2024, the asset traded at a peak of $1.5.
ENA's market capitalization stands at $1.54 billion, while the total value locked on Ethena is $4.5 billion, of which USDe accounts for about $4 billion. Recall that in August 2025, the project's stablecoin entered the top three largest, but within three months its supply shrank by more than 50% due to declining yields.
My analysis: The initiative is sound and timely—it transforms ENA from an inflationary asset with a constant overhang of sales into an instrument with a real price support mechanism. However, success will depend on whether Ethena can maintain USDe's yield at a competitive level. If revenue declines, buybacks will become symbolic, and the effect will quickly fade. The market still believes in the plan, but the protocol's fundamental metrics remain a key risk.