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Following
ENA The Ethena Foundation initiated a governance proposal: Agreement revenue will be used to buy back ENA, provided that a US$7.5 billion trigger condition is met first.
The Ethena Foundation submitted a governance proposal on August 27, which plans to use most of the agreement revenue to buy back ENA on the open market. But the premise is that the mechanism will only be activated after the circulating supply of Erena synthetic US dollars USDe reaches US$7.5 billion. As of this week, USDe's supply was approximately $4.04 billion, which means supply needs to grow by approximately 85% to use the first revenue for buybacks.
How the US$7.5 billion trigger works
This proposal submitted to the Etha Governance Forum sets a hierarchical structure: once USDe supply exceeds the US$7.5 billion threshold, 5% of Etha's core business line net income will be used to buy back ENA, and this proportion will increase as supply increases. At the highest level disclosed (USDe supply reaches US$25 billion), the ratio will rise to 25%. Regardless of which tier takes effect, 95% of the revenue captured by that tier will be dedicated to open market ENA repos, with the rest used to fund growth plans for USDe savings products, white-label stablecoins, and new product lines the foundation has announced will be launched soon.
Buyback Still Distant
It is worth noting that the $7.5 billion threshold is much higher than the standard set by Ethena's Risk Committee in November 2024-at that time, the committee believed that if USDe supplies exceeded $6 billion and cumulative revenue exceeded $250 million, the fee switch could be activated. In fact, USDe broke this low threshold last year, approaching a peak of US$15 billion in October 2025, and then fell back to current levels. The new proposal actually sets the goal at a higher level than previously achieved by the agreement.
Immediate changes that do not rely on USDe growth
The part of Thursday's announcement that takes effect immediately and does not rely on USDe growth will have a more significant direct impact on the market. The foundation bought back locked ENA tokens from early investors who had sold them since their peak in October 2025, while investors who had never sold received offers to buy them back at face value, but no one accepted them. In addition, the remaining investor tokens that were originally unlocked on a monthly basis will be unlocked once on October 5. Team tokens maintain the original ownership schedule, and approximately 12% of the total ENA supply is still locked in the team, ecosystem and foundation holdings.
ENA's rise and October intellectual property agreement
Since the announcement, ENA has risen sharply, trading close to $0.147, a 24-hour gain of mid-single digits and a weekly gain of nearly 45%, continuing the rally that began before the announcement. According to reports, the market's initial reaction to the news sent its immediate increase to double-digit percentage points. In addition, the foundation and Ethena Labs have agreed in principle to transfer the intellectual property rights and economic benefits of the agreement from the equity holders of Labs to the foundation. The relevant agreement is expected to be announced in October, but the specific terms have not yet been disclosed.
The repurchase mechanism is a real commitment backed by real-time governance voting and risk committee approval. But it is essentially an expectation of future growth, not current cash flow. Before USDe supply climbed significantly, the most direct impact on ENA liquidity were changes that could be activated without any threshold: namely buybacks and unlocked mergers.
