ENA Surges Over 130% in 10 Days: VC Unlocks End, 95% of Protocol Revenue to Buybacks

ENA's biggest supply-side nightmare is essentially over, and the market no longer needs to trade around the unlock calendar every month.

Original title: "Behind ENA's Surge: Ethena Foundation's Four-Pronged Self-Rescue Plan"
Original author: Maher, Foresight News

On Aug. 28, ENA had soared to $0.189, while just 10 days earlier its price was hovering around $0.08. If you held ENA over the past two years, you likely lost money. From its all-time high of $1.52 in April 2024, the token fell more than 90%. There were several rebounds along the way, but each time relentless unlock selling pressure pushed the price back down—until mid-August this year.

The broader market recovery is certainly a key factor, but the latest announcement is what drove the sharp rally. On Aug. 27, the Ethena Foundation dropped what can only be called a "self-revolution" announcement, prompting the market to reprice the token.

Foundation Defuses the VC Unlock "Time Bomb"

ENA's biggest bearish narrative over the past two years has been the endless token unlocks. Seed round, Series A, team, advisors—every month a batch of tokens was released from lockup and dumped into the market. This selling pressure was structural—no matter how good the fundamentals, someone was selling at any cost every month.

The Ethena Foundation has now defused this bomb.

The official announcement includes two surgical operations on the supply side:

Buyback of seed investors' locked tokens. The foundation has completed the acquisition of all locked ENA tokens from certain major seed investors who had sold ENA over the past nine months. This means the remaining locked chips held by these early investors were bought back by the foundation in one go and will no longer flow into the secondary market.

Cancellation of all future monthly VC unlocks. The foundation reached an agreement with major investors to eliminate future monthly unlock selling pressure from VC investors by releasing unvested tokens. According to supplementary reports from English-language media, the remaining original investors' unlocks will be accelerated starting Oct. 5, 2026, after which no investor tokens will remain locked.

The only thing left untouched is team tokens—they will remain locked according to the original vesting schedule.

With these two moves, ENA's biggest supply-side nightmare is essentially over, and the market no longer needs to trade around the unlock calendar every month.

Protocol Revenue Finally Tied to ENA

In DeFi, there is a soul-searching question: Can your governance token actually capture protocol value? Before this, ENA was in an awkward position. USDe is the third-largest stablecoin, and the Ethena protocol earns tens of millions of dollars in fees every month, but ENA holders received almost no economic returns beyond voting rights.

Now, that impasse has been broken.

The Ethena Foundation has launched a governance proposal with one core element: use 95% of the protocol's net revenue to programmatically buy back ENA on the secondary market.

In addition, the official design includes a clear trigger mechanism: when USDe's circulating supply reaches $7.5 billion, the buyback officially begins; as USDe supply surpasses milestones like $10 billion and $15 billion, the buyback ratio will increase in steps.

In other words, the faster USDe grows, the stronger the buying pressure on ENA. This creates a clear positive flywheel: USDe expansion → protocol revenue increases → ENA buyback accelerates → token price rises → market attention increases → USDe expands further.

It is worth noting that this "fee switch" concept has been brewing for a long time. As early as November 2024, the community began discussing it; in September 2025, the foundation announced that activation conditions had been met (USDe supply exceeding $6 billion, cumulative revenue exceeding $250 million), but the actual vote and implementation were delayed until now.

Ethena has not been without token buybacks before. In the second half of 2025, a buyback program called DAT (Decentralized Autonomous Trust) invested approximately $890 million in total, executed in two phases. But that was a one-time operation using reserve funds, whereas this proposal turns buybacks into a permanent mechanism tied to protocol revenue.

Cutting Off Equity Holders' "Blood-Sucking" Pipeline

Many DeFi projects have a hidden flaw: the interests of the development company's equity investors and token holders are not aligned. The company makes money, equity holders get dividends; whether the token rises depends on the company's mood. Ethena faced this problem in the past—Ethena Labs is a traditional company with an equity structure, while ENA is an ecosystem token, and their values are not fully aligned. The foundation has now plugged this hole directly.

The Ethena Foundation and Ethena Labs have reached a master framework agreement. The agreement stipulates that intellectual property and value attribution generated by the protocol will belong exclusively to the foundation and be governed by ENA holders; equity investors in the Labs entity will no longer enjoy residual cash flows.

This means Ethena Labs' equity investors have been "shown the door"—they can no longer take a cut from the protocol's economic output. In the future, all value generated by all business lines under the Ethena brand will flow to the foundation, and then be distributed by ENA holders through governance.

Coinbase Ventures Positioned Early, Hayes Calls for 5x Rally

This last secret has nothing to do with technicals or fundamentals—it's about human nature. ENA fell too hard. From $1.52 in April 2024, it dropped to an all-time low of $0.0699 in June this year. But extreme declines often breed extreme reversals. For a protocol with substantial annual revenue, this valuation had entered "bargain" territory.

In June 2026, Coinbase Ventures publicly announced it was buying ENA on the secondary market and had reached a partnership with Ethena to develop on-chain financial products.

On Aug. 6, Arthur Hayes bought 10.9 million ENA, bringing his total holdings to 22.64 million (worth about $4 million). He said that if increased dollar liquidity pushes BTC higher, a recovery in Bitcoin basis yields could attract funds back into USDe, and stated that ENA could potentially achieve a 5x increase in the coming months. On Aug. 25, BitMEX founder Arthur Hayes again called for ENA: "OTC brokers are starting to contact us about borrowing dollars. Rates are still too low, but this is a good sign that the basis trade is returning. ENA will benefit from this, with huge upside."

Of course, the risks must also be acknowledged. USDe's supply has shrunk from a peak of about $15 billion in October 2025 to around $4 billion now. Revenue-based buybacks presuppose sustained protocol revenue, and the decline in USDe supply means underlying revenue is under pressure. If USDe cannot resume growth, the so-called revenue buyback may be nothing more than a castle in the air.