Ethena's Unanimous Buyback Proposal Poised to Reshape Tokenomics

Ethena's revenue-based buyback proposal is gaining momentum, having received unanimous support from early voters. The plan, which aims to overhaul the protocol's tokenomics, will conclude on September 2.

The proposal introduces a mechanism where 95% of net revenue from each business unit will be used for buying back ENA tokens from the open market once a first target is met. This marks a significant departure from the previous model, where revenue was primarily allocated to other purposes.

In addition to the buyback mechanism, the proposal includes several structural changes. Ethena plans to repurchase locked tokens held by early investors, unify its token and equity structure, and cancel monthly VC unlocks. The latter move is intended to prevent periodic sell pressure that has historically weighed on ENA's price.

If approved, the plan could significantly reshape Ethena's tokenomics. The expected increase in USDe supply from $4.06 billion to $7.5 billion would likely drive growth in demand for the synthetic dollar, attracting more users and enhancing yield generation.