Ethena Just Proposed Buybacks. How Does Its Plan Look for Investors?

Quick note from me this week: the number that sent ENA up as much as 27% in two days lives in a governance post, not a filing or a contract. I went looking for what it actually promises, and the answer is $22.5 million a year, eventually, if USDe grows another 78% first. The part that surprised me is where that money would come from, which is the budget Ethena currently uses to buy the growth the switch is waiting for.

Ethena Just Proposed Buybacks. How Does Its Plan Look for Investors?

Crypto projects have started returning value to their tokenholders, buying back tokens with real revenue the way public companies buy back stock, and voting to cut new supply. Ethena proposed a buyback program last week and ENA rose as much as 27% over the two days that followed. Solana's validators voted to cut the supply of new SOL. And Hyperliquid already spends nearly all of its trading fees buying back its own token, every day, automatically.

Buybacks themselves aren't new. Binance was burning BNB with a fifth of its quarterly profits years ago. What changed this year is that paying tokenholders stopped looking legally radioactive in the U.S., and value-return programs became standard in about a month.

These programs are not alike. Some are rules: written into code or a fixed schedule, automatic, easy to verify. Some are pens: decisions a foundation makes privately, on terms it sets. And the one that moved the market most last week hasn't bought anything: Ethena's buyback does not switch on until USDe, its synthetic dollar, grows 78% from here.

What Ethena Actually Proposed

Ethena's proposal would activate a "fee switch," routing a share of the protocol's revenue into ENA purchases. Ethena runs USDe, a $4.22 billion synthetic dollar that earns yield from the basis trade: hold an asset, short its perpetual future, collect the funding longs pay.

The terms are a staircase. The take rate (the share of net revenue directed to buybacks) starts at 5% when USDe supply reaches $7.5 billion and scales to 25% at $25 billion, per the milestone table in the governance post. At the first milestone, that's roughly $22.5 million a year of buying, by the post's own illustrative math; at $20 billion of supply, $240 million.

The number that traveled last week was 95%: the share of the Foundation's revenue take that buys ENA once the first milestone hits. The number that matters is the take itself, and the proposal never reconciles its own two rules: the milestone table takes a share of gross protocol revenue, while the text directs 95% of the Foundation's net revenue. An equity buyback comes wrapped in board authorization, securities filings, and liability. This one is a governance post and a vote.

That vote is live on Snapshot and closes Sept. 2 at 13:59 UTC. As of Tuesday evening it ran 17.7 million ENA in favor, none against, across 85 votes. ENA trades near $0.158, below the proposal day's peak but up roughly 77% in 30 days.

In the rest of the issue, subscribers get:

• the math at today's numbers: what the buyback yields, and the growth it assumes

• what the money is doing instead, and why the same take rate costs Ethena more than Hyperliquid

• the rule vs. pen test that separates value return from financial engineering

• bull, base and bear scenarios for ENA, with price targets, plus the dated catalysts

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