Ethena Foundation has announced a sweeping reset of ENA token economics, centered on three changes: ending the monthly VC token unlock cycle, putting a fee switch proposal to a governance vote, and shifting most protocol intellectual property and economic rights away from Ethena Labs shareholders and toward the foundation and the broader ecosystem.
The announcement landed as ENA surged 23% in a single day on Thursday to $0.17 and doubled over the past week, according to the source article, making it one of the strongest-performing crypto assets of the week.
Three parts of the overhaul
According to updates published by the Ethena Foundation on its official blog and X account, the first step was a buyout of remaining locked ENA tokens held by certain large seed investors that had sold ENA during the past nine months. The foundation also accelerated the vesting completion for the remaining original investors, formally bringing the monthly release of VC tokens to an end. Team tokens will still vest under the original schedule.
The second piece is a governance proposal described as a fee switch. ENA holders are currently voting on Snapshot. If the proposal passes, the protocol would create a programmatic source of ENA demand linked to USDe circulation milestones. Once USDe supply returns to the first threshold of $7.5 billion, 95% of Ethena brand business net revenue would be directed to ENA buybacks, while the remaining 5% would go to ecosystem growth.
The third change addresses ownership and economics. Ethena Labs and the foundation have reached an agreement in principle under which the vast majority of Ethena protocol intellectual property and economic rights would belong to the foundation and the ecosystem, rather than being exclusively captured by Ethena Labs equity holders. A formal agreement is expected in October.
In the source article’s framing, the package tackles both sides of the token equation. Monthly VC-driven sell pressure is being removed from the supply side, while a conditional buyback framework is being introduced on the demand side.
Foundation statement on X
In a post on X dated August 27, 2026, Ethena Foundation wrote: 「We are excited to announce four updates regarding the Ethena ecosystem, further details on each point are provided in the blog linked below」. The post also said the foundation executed a buyout of all locked tokens from certain major seed investors that had sold tokens.
USDe contraction set the stage
The overhaul comes against a much smaller USDe base. The report said USDe, Ethena’s synthetic dollar product, had nearly reached $15 billion in circulation during the crypto bull market peak in October 2025. It has since fallen to below $5 billion.
USDe yield is mainly derived from derivatives funding rates. As crypto market conditions cooled, those funding rates weakened, reducing the appeal of USDe yield and contributing to holder outflows. In that context, Ethena has been under pressure to find new sources of growth and revenue support.
Recent partnerships are tied to USDe expansion
The report also listed several moves made by Ethena in recent weeks. It said Ethena set up a $1 billion facility with FalconX to move USDe reserve assets into overcollateralized institutional loans. It added that Janus Henderson invested in ENA in June and has been evaluating possible USDe distribution. Coinbase and Ethena have also launched a savings product, while Coinbase Ventures directly bought ENA.
Those arrangements, according to the article, show Ethena trying to move USDe beyond a purely DeFi-native setting and position it closer to institutional and traditional finance rails. Under the proposed fee switch structure, that matters because USDe scale needs to recover before buybacks can begin.
The $7.5 billion threshold is the central variable
The practical effect of the overhaul depends on whether USDe circulation can climb back to $7.5 billion. Without that recovery, the mechanism that routes 95% of net revenue to ENA buybacks would not turn on.
The source article said the broader crypto market has improved, with Bitcoin above $80,000 and Ethereum ecosystem activity picking up, conditions that could help derivatives funding rates recover. It also pointed to FalconX, Janus Henderson and Coinbase as potential channels for new USDe inflows.
Still, the report noted an existing concern raised by Andre Cronje in 2024, when he questioned whether USDe could face a “death spiral” risk. If funding rates remain negative or near zero for an extended period, the article said, USDe yield may struggle to hold, which could lead to holder exits and pressure on collateral unwinds.
For now, the overhaul directly changes ENA’s supply outlook, buyback design and rights structure. Whether USDe itself returns to growth remains the condition that will determine how much of the plan moves from governance proposal to operating model.
What the market is watching next
The next checkpoints are the outcome of the Snapshot vote on the fee switch proposal, the detailed ownership agreement expected in October between Ethena Labs and the foundation, and whether USDe circulation shows signs of stabilizing and recovering.