The Ethena Foundation has initiated a vote on a radical change to the ecosystem's financial model. The proposal suggests directing nearly all of the protocol's net revenue toward a programmatic buyback of the governance token ENA from the open market. This is a step that could fundamentally reshape the approach to value distribution in DeFi projects.
The Mechanics of the "Fee Switch"
If approved by the community, revenue from all Ethena products, including the USDe stablecoin, will be consolidated for the token buyback. Previously, revenue was distributed between sUSDe holders and partner programs. Now, the priority shifts toward supporting the ENA price. The risk committee has already given the green light, and the vote has been launched on Snapshot. However, exact timelines and guarantees of approval have not yet been disclosed — the suspense remains.
Restructuring Value Rights
In parallel, Ethena Labs and the Ethena Foundation have signed a Master Framework Agreement, under which intellectual property and rights to the value generated by the protocol transfer exclusively to the foundation's management. Going forward, these assets will be controlled by ENA holders through governance mechanisms. Under the terms of the agreement, Ethena Labs investors lose residual rights to cash flows — an unprecedented step for the industry.
Reducing Future Market Pressure
A key aspect of the update is tokenomics. The foundation and leading venture investors have agreed to cancel future monthly unlocks. Recall that this category accounted for 25% of ENA's fixed supply — 3.75 billion coins. Previously, a one-year cliff and three-year vesting were planned. Now, unlocked tokens are removed from the schedule, although team assets will continue to be released on the previous timeline. Additionally, the foundation has bought back remaining locked ENA from several early investors who had been selling coins over the past nine months, though deal details have not been disclosed.
Market Reaction and Prospects
The news triggered an immediate response: the ENA price surged nearly 12% in a day, reaching $0.16. For comparison, in April 2024, the asset traded at a peak of $1.5. The market capitalization stands at $1.54 billion, and TVL in Ethena is $4.5 billion, of which ~$4 billion is in USDe.
This move is an attempt to kill two birds with one stone: create sustainable demand through buybacks and eliminate pressure from future unlocks. However, it's worth remembering that in August 2025, USDe entered the top three stablecoins, but within three months, its supply collapsed by 50% due to falling yields. The new model could be a lifeline, but it also increases ENA's dependence on the protocol's success, raising risks for long-term holders.