๐ What Is Ethena ($ENA )?
Ethena is a DeFi protocol on Ethereum that introduces USDe, a synthetic dollar designed to stay stable without fiat reserves.
Instead of collateral over-backing, Ethena uses:
stETH as collateral
Delta-hedging (short perps) โ neutralizes ETH price volatility
This lets USDe maintain a stable peg and generate yield at the same time.
๐ Key Differentiator
Internet Bond โ USDe holders earn yield from:
ETH staking rewards
Funding rates in futures markets
Result: a yield-bearing stablecoin that competes with both USDT/USDC and DeFi yield protocols.
๐ $ENA Tokenomics
Total Supply: 15B
Circulating Supply: ~6.62B (โ44%)
Vesting: 1-year cliff + 3-year linear unlock for team & investors
Utility: Governance (protocol parameters, USDe policy, revenue allocation)
๐ฅ Scarcity & Burn Mechanics
USDe Stablecoin
When redeemed, USDe is burned permanently โ reduces supply as demand fluctuates.
ENA Governance Token
Not a strict burn model, but deflationary levers exist:
Protocol may use fees + surplus yield for buybacks & burns
Airdrop recipients required to lock tokens, reducing liquid supply
Net effect: ENA supply expands (vesting) but can shrink (burns/locks) โ balancing inflation vs. scarcity.
โ ๏ธ Why ENA Burns Arenโt Always Obvious
Conditional: burns depend on fee surplus + protocol activity
Unlock Pressure: vesting schedules release tokens, sometimes offsetting burns
Focus on USDe: the most consistent deflationary action comes from USDe redemptions, not ENA itself.
๐งญ Big Picture
USDe โ a stablecoin with yield + burn mechanics
ENA โ governance + supply sinks (lockups/burns)
Together, they create a hybrid system: growth via issuance, stability via burns.
