Ethena Unveils Ecosystem Overhaul, Pushes Expanded ENA Buybacks

Ethena Foundation Buys Out Seed Investors’ Token Holdings

Remaining Unlocks to End in a One-Time October Release

Vote Underway on Fee Switch

Foundation Says Revenue Would Fund Buybacks if Approved

Stablecoin protocol Ethena said on Aug. 27 that it is pursuing a sweeping overhaul of its ecosystem.

The plan centers on buying ENA tokens held by early investors, ending the remaining lockups with a one-time release, redefining rights between the foundation and the developer, and using protocol revenue for ENA buybacks. The goal is to remove selling pressure created by monthly investor unlocks and direct protocol economics more squarely toward ENA holders.

Buying Out Early Investors, Removing the Monthly Unlock Overhang

The Ethena Foundation said it bought all locked tokens held by major early investors through over-the-counter trades over the past two weeks, as long as those investors had sold ENA at least once after the token reached its peak in October 2025. The purchases targeted investors that had been allocated more than 0.25% of total supply, except for one wallet that indicated it planned to keep its holdings. The foundation also approached investors who had not sold after the peak, but none accepted.

The lockup schedule for the remaining investor-held tokens will end before Oct. 5. Ethena said it will make those locked tokens freely tradable in a single release to eliminate the recurring pressure from monthly unlocks. After the overhaul, about 12% of total supply will remain locked, limited to holdings by the team, ecosystem and foundation. The team’s existing vesting schedule will stay in place.

Developer Shareholders Get No Economic Rights; IP and Revenue Belong to Foundation

The Ethena Foundation and Ethena Labs, the protocol’s developer, also reached agreement in principle on key terms of a Master Framework Agreement. Under the arrangement, core protocol intellectual property and any economic benefits that could arise from events such as a business sale would belong to the Ethena Foundation and the broader ecosystem, not Ethena Labs shareholders.

Under the agreement, equity investors in Ethena Labs would also have no claim on protocol cash flows. The foundation said Ethena Labs shareholders have never received even $1 of protocol revenue in any form. It added that the agreement formalizes the existing business structure. The full text will be disclosed in October.

Proposal Calls for Automatic ENA Buybacks Using 95% of Net Profit

Ethena also plans to introduce a fee switch that would redirect part of protocol revenue to token holders. Under the proposal, 95% of net profit attributable to the foundation across all Ethena-branded businesses would be used to automatically buy ENA in the market, while the remaining 5% would be reserved for growth.

Ethena’s Risk Committee recently approved the proposal. Voting is now under way on governance platform Snapshot.

If the proposal passes, the share of revenue allocated to buybacks would rise from 5% to as much as 25% when USDe supply surpasses milestones of $7.5 billion, $10 billion and $15 billion. The foundation also set a goal of expanding USDe supply to more than $100 billion within five years.

Buybacks would begin once the first milestone of $7.5 billion is reached. Final adoption of ENA buybacks, along with detailed purchase terms, will be determined by the outcome of the governance vote.

Separately, Ethena plans to unveil Ethena X as soon as next week, its third new business after the USDe Savings deposit service and the WhiteLabel stablecoin issuance support service.