The Ethena ecosystem is entering a phase of radical transformation. The Ethena Foundation has put forward a proposal for a vote that would direct nearly all of the protocol's net revenue toward a programmatic buyback of the governance token ENA. If approved by the community, this decision will fundamentally change the project's economics.
A complete reversal in revenue distribution
The essence of the initiative is a radical "fee switch." Instead of distributing revenue among sUSDe holders, partners, and other directions, as was done previously, all proceeds from Ethena products (including the USDe stablecoin) will be directed toward market buybacks of ENA. This creates a direct and sustainable model of buyback pressure on the token. The vote has already been launched on the Snapshot platform and received preliminary approval from the Risk Committee, but the exact timeline for its completion has not yet been disclosed.
Value concentration and a new ownership structure
In parallel, Ethena Labs and the Ethena Foundation have entered into a Master Framework Agreement. Under the terms of the agreement, all intellectual property of the protocol and rights to generated value pass exclusively into the Foundation's control. Going forward, management of these assets will be carried out by ENA holders through decentralized governance mechanisms. It is important to note that Ethena Labs investors, under the new agreement, completely lose residual rights to the protocol's cash flows.
Tokenomics: investors lose future unlocks
A key element of the update concerns the structure of the ENA supply. The Foundation and leading venture investors have agreed to cancel future monthly unlocks of tokens allocated to this category of holders. This concerns 25% of the fixed ENA supply — 3.75 billion coins. Previously, these assets were subject to a one-year cliff period followed by a three-year vesting schedule. Now, the unlocked tokens of investors who accept the new scheme will be excluded from the emission schedule. Team tokens will continue to enter circulation according to the original schedule.
Moreover, the Foundation announced the buyback of remaining locked ENA from a number of major seed investors who had been selling tokens over the past nine months. Details of these transactions have not been disclosed.
Market reaction and my conclusions
The market responded positively to the news: the ENA price rose nearly 12% in a day, reaching $0.16. For comparison, the all-time high of $1.5 was recorded in April 2024. The current market capitalization stands at $1.54 billion, with total value locked in Ethena at $4.5 billion, of which ~$4 billion is in USDe. It is worth recalling that in August 2025, the project's stablecoin was among the top three in its segment, but over three months its supply shrank by more than 50% due to declining yields.
This is a bold and timely move. In my view, the combination of aggressive buybacks and the elimination of future unlock pressure creates a much healthier market structure for ENA. However, success will depend on the protocol's ability to generate sufficient revenue amid declining stablecoin yields. If the model is sustainable, we could see a significant reassessment of the token's valuation in the medium term.