Arthur Hayes may have called ENA to $0.50, but the market’s real question is simpler: who is buying, and who may be preparing to sell?
On Sept. 20, the BitMEX co-founder publicly backed Ethena’s governance token ENA on social media and put a $0.50 target on it. The reaction was immediate. Spot ENA climbed quickly from around $0.17 to above $0.21, with intraday gains at one point topping 24%.
Before chasing that move, traders have another set of numbers to look at: the size and cost basis of Hayes’ own position.
According to on-chain tracking from Arkham, a wallet linked to Hayes had already built the position about a month earlier. The address accumulated 25.33 million ENA at an average price of roughly $0.09, with total spending of about $5.53 million. Based on the market price cited in the source, the position was carrying more than $3.28 million in unrealized profit, a paper return above 146%.
In crypto, a public bullish call from a large holder who is already deep in profit is often treated as a warning sign as much as a catalyst. Some on-chain watchers read the setup less as conviction buying and more as a search for exit liquidity. One community user cited in the source argued that when a hedge fund trader holding tens of millions of low-cost tokens starts selling retail on a long-dated upside story, it often means he is also looking for liquidity to realize those gains.
ENA then pulled back not long after Hayes’ post, which added to the view among some traders that the call may have doubled as distribution.
That said, reducing the entire move to a simple “shill and dump” misses a broader shift in how Ethena, and some other older tokens with established products, are being repriced. In this round of speculation, capital has tended to favor names that still have operating revenue, improving token supply structure and at least some fundamental support. ENA fits that profile.
Hayes’ timing also lines up with one of the most aggressive tokenomic changes Ethena has made since launch. On one side, the project is trying to move ENA away from a governance-only shell and closer to a cash-flow-linked asset. On the other, early investor supply has not fully cleared, leaving a visible overhang. Those two forces are now colliding in the same trade.
Foundation buyouts changed the schedule, but Oct. 5 still matters
For a long time, the main drag on ENA’s valuation was not simply protocol scale. It was supply. Large recurring unlocks had become a known source of pressure, and for a synthetic asset protocol managing tens of billions of dollars, monthly token releases acted like a standing drain on secondary-market pricing.
That setup began to change in late August.
Ethena Foundation said earlier that it used ecosystem reserves to buy out locked allocations from seed-round investors through over-the-counter transactions. For early backers whose original allocations exceeded 0.25% of total supply, the foundation carried out targeted screening and negotiated buyouts. Any remaining locked allocations that were not bought out must now be released in a one-time event by Oct. 5, after which the previous long-tail monthly unlock schedule will no longer remain in place.
In theory, that cuts off years of gradual dilution. But it also pulls risk forward. The portions that were not bought out are now concentrated into a release window before Oct. 5, which means the market still has to absorb a sharp burst of potential selling in the near term. Put differently, any real supply vacuum may not arrive until after mid-October.
Until that early-October event is behind the market, a fast move higher that is not matched by real spot demand could become an attractive exit window for early investors and large holders.
95% of net revenue for buybacks has become the core bull case
The other major shift is not about supply. It is about value capture.
In DeFi, many protocols have struggled with the same disconnect: the business generates revenue, while the token fails to reflect it. Ethena’s synthetic dollar USDe and its Treasury-linked product USDtb expanded quickly on the back of basis-trade economics and Treasury yield. The project also secured $1 billion in financing support from FalconX and integrated with BlackRock’s Aladdin system, according to the source.
Even so, ENA holders historically had little direct economic claim on that growth. The token’s role was largely limited to governance, without a meaningful distribution right.
The mechanism meant to change that is Ethena’s recently approved governance proposal to use 95% of protocol net revenue to buy back ENA on the secondary market.
Under the structure described in the source, users minting USDe and USDtb expand the protocol’s assets under management. Ethena then earns short-basis income from hedging on derivatives exchanges, alongside spread income from reserve assets. That becomes retained net profit at the protocol level. Smart contracts would then direct 95% of that net cash flow into scheduled ENA buybacks, with purchased tokens either moved to the treasury or burned.
If that loop holds, ENA’s valuation framework shifts away from pure sentiment and toward discounted expectations of protocol cash flow. The proposal passed with 14.1 million votes in favor and zero against, far above the 5 million quorum requirement. The source interprets that result as a sign that large holders and market-making capital are aligned on turning on the fee switch.
Still, the model has a weak point: derivatives funding rates.
A key pillar of Ethena’s revenue base is positive basis and bullish positioning in the derivatives market. If the broader crypto market turns deeply bearish and perpetual funding rates stay negative, the protocol would not only lose a major source of basis income. It could also need to use reserves to subsidize short hedges. If underlying revenue contracts, the amount available for buybacks under the 95% rule would fall with it, and the cash-flow story would weaken at the same time.
That leaves Ethena’s revenue narrative tied closely to broader market conditions. With the market described in the source as relatively stable for now, the story still has room to run. But it is not independent of the cycle.
$0.50 is the headline, but wallet behavior may matter more
From a research perspective, the $0.50 target looks less like a precise valuation call and more like expectation management.
The source’s core view is that Hayes’ large position, built around $0.09, gives him unusual flexibility. The move from $0.21 toward $0.50 sketches out an upside scenario for retail traders, but it does not prevent him from selling into strength at any point along the way.
For a whale already sitting on a 146% paper gain, distributing into peak enthusiasm would be a standard hedge-fund trading move. Traders may benefit from the attention such a call brings, but following it blindly is a different matter.
The source therefore suggests that more active market participants monitor the relevant wallet address to see whether Hayes’ on-chain behavior matches his public stance.
Strip away the positioning battle, and ENA’s asset profile does appear to be changing relative to other older tokens. The 95% net-revenue buyback framework gives the market a concrete cash-flow narrative to trade.
The next key date is Oct. 5, when the concentrated token release window arrives. How large holders rotate, and how well the market absorbs any resulting sell pressure, may offer a clearer answer than the headline target itself.
