Ethena’s ENA Hits 7-Month High as Binance USDe Listing Fuels $500M Buyback Hopes
Ethena’s governance token, ENA, surged Tuesday to its strongest level since late January, as the decentralized finance (DeFi) protocol advances toward activating a fee switch that would share protocol revenues with token holders.
ENA reached $0.87 in early trading, up 8.3% over 24 hours and more than 20% over the past week, according to CoinDesk data. The jump follows Binance’s announcement that it will list Ethena’s $13 billion yield-generating token, USDe, on its platform starting Wednesday.
Listing USDe on major exchanges is a key step for Ethena to enable the fee switch mechanism, allowing profits to flow to ENA holders. The protocol generated $54 million in revenue last month and over $480 million since its late-2023 launch, according to Token Terminal.
“With the Binance USDe listing, the ENA fee switch is going to get turned on. That unlocks $500 million of buybacks,” said Arthur Hayes, BitMEX co-founder and prominent Ethena investor.
Ethena’s Recent Catalysts
Ethena’s momentum extends beyond the Binance listing. USDe’s market capitalization has climbed from $5.5 billion in mid-July to nearly $13 billion, fueled by investors seeking yield. Marketed as a “synthetic dollar,” USDe is backed by Bitcoin (BTC), Ether (ETH), and Solana (SOL), paired with an equal value of short perpetual futures positions.
This strategy generates revenue on derivative-backed assets when perpetual funding rates are positive, passing part of the income to investors as yield. USDe currently offers a 6.5% annualized return for stakers, higher than traditional money market funds and DeFi lending rates on platforms such as Aave.
Ethena is also participating in the growing digital asset treasury trend. StablecoinX and TLGY, two firms preparing for a Nasdaq listing, raised $530 million to acquire ENA tokens as a public investment vehicle.
Additionally, the protocol is expanding in the stablecoin space. It is launching a native stablecoin for Ethereum scaling network MegaETH and has indicated plans to participate in the upcoming stablecoin from derivatives exchange Hyperliquid.
