Ethena proposes to buy back ENA and reform investor token unlocking schedule

DeFi and Token Economy News

The Ethena Foundation announced adjustments to the ENA token economy to address the problem of early investors unlocking selling pressure and value flow.

On August 27, the Ethena Foundation announced four adjustments to its ENA token economy model, aiming to solve two major long-term problems: the selling pressure caused by early investors unlocking, and the uncertainty of the agreement value flowing to token holders.

ENA rose 23% to US$0.17 in 24 hours after the news was announced. In the past week, driven by the overall recovery of the crypto market, the price of the token has roughly doubled.

The foundation said it has repurchased its remaining locked tokens from certain large seed investors who have sold ENA in the past nine months. These transactions were completed in the past two weeks through over-the-counter transactions.

Ethena divided investors who were initially allocated more than 0.25% of ENA's total supply into two groups: one group had sold at least one token since the market peaked on October 10, 2025, and the other group had never sold. For investors who have not yet sold their tokens, the foundation allows them to sell locked tokens at the original purchase price (without discounts), but no one accepts them. The foundation bought back all unlocked tokens from investors who had sold them, and only one wallet refused to sell them. Ethena did not disclose the identity of the investors involved, the number of tokens acquired or the transaction amount.

Terminate monthly unlocking and reallocate agreement value

The Ethena Foundation and major investors have reached an agreement to release all remaining original investor tokens in one time starting October 5, ending the monthly unlock program that continues to cause selling pressure. Team tokens will continue to be locked according to the original unlocking plan. After adjustment, approximately 12% of ENA's supply will remain locked and unlocked, including only the portion held by teams, ecosystems and foundations. As one of the two largest ENA holders holding approximately 20% of the total supply, StablecoinX will continue to comply with the separate lock-up arrangements set out in its publicly submitted token purchase agreement.

The Ethena Foundation and Ethena Labs also reached a consensus in principle on a master framework agreement. The agreement will transfer almost all significant agreement intellectual property (other than the interests of Erena Labs equity holders) to the foundation and its ecosystem. The economic benefits generated by the agreement, including future proceeds from sales of related businesses, will also flow to foundations and ecosystems. The framework is expected to be announced in October.

According to The Block Pro's financing dashboard, Ethena's early investors include Dragonfly Capital, OKX Ventures, Arthur Hayes's Maelstrom, Nic Carter's Castle Island Ventures, Franklin Templeton and Galaxy Digital.

Cost switches linked to USDe supply milestones

The Ethena Foundation has opened a governance vote on fee switches. The mechanism directs agreement revenue to programmed ENA buybacks, which are activated when USDe supply reaches a certain threshold. Once USDe supply reaches the first milestone-$7.5 billion-, 95% of the net income of Ethena's three core business lines will be used to buy back ENA on the open market. The remaining 5% will be allocated for growth. These business lines include USDe Savings, Ethena's white-label stablecoins, and a third product,"Ethena [X]," scheduled to launch next week.

The background of this adjustment is that USDe supply has dropped from a peak of nearly US$15 billion in October 2025 to below US$5 billion. Part of the gains from this synthetic dollar come from derivative funding rates, which have been significantly reduced as the crypto market cools. Since then, Ethena has been pursuing new growth paths, including agreeing a $1 billion facility with FalconX to use USDe collateral for overcollateralized institutional loans. Janus Henderson invested in ENA in June and is exploring USDe's allocation options;Coinbase has partnered with Ethena to launch a savings product, and its venture capital arm has also purchased ENA.