Ethena announced plans on Aug. 28 to expand its basis trading strategy into equity perpetual futures, targeting significantly higher yields as the USDe stablecoin works to recover from recent supply losses.
Equity perpetual markets on major crypto exchanges have developed substantially, with open interest surging to approximately $6.2 billion from less than $1 billion in March. Funding rates in these markets have averaged about 14% on Hyperliquid and 17.5% on Binance in recent months, compared to Bitcoin perpetual funding that averaged 2.2% through Aug. 11.
The expansion broadens Ethena's basis strategy from crypto markets worth about $2.5 trillion to the broader equities market valued at over $120 trillion. According to Ethena founder Guy Young, real-world asset perpetual volume exceeded half of crypto volume on Hyperliquid last month, with aggregate RWA perpetual volume on Binance reaching roughly twice BTC-USDT volume. The protocol plans to deploy into equity-basis positions over the coming weeks using existing infrastructure.
Declining Crypto Yields Drive Market Shift
The move comes as USDe has declined to approximately $4.04 billion, less than one-third of its $15 billion peak in 2025. Crypto basis positions, which originally powered USDe's growth, now represent only about 13% of the stablecoin's backing as falling crypto funding rates have made traditional basis trades less attractive.
Ethena has diversified USDe's reserve backing to include DeFi lending at 30.8%, liquid stablecoins at 32%, real-world assets at 12.3%, and institutional lending at 11.8%. These allocations generate yields ranging from 3.1% to 7%.
Governance Ties Token Buybacks to USDe Recovery
A governance proposal unveiled Aug. 27 would direct revenue toward ENA token buybacks once USDe reaches $7.5 billion in supply. The buyback allocation would increase at higher thresholds of $10 billion, $15 billion, and $20 billion. At current levels, USDe needs to grow by approximately $3.46 billion, or roughly 86%, to reach the first milestone.
Once activated, the protocol proposes directing 95% of net revenue from USDe savings, white-label stablecoins, and a new product called Ethena X toward ENA purchases. The Risk Committee recommended using a 14-day trailing supply average to determine threshold activation, with historical backtests estimating annual buybacks of approximately $52.7 million.
ENA token trading has already reflected market expectations, reaching around $0.163 on Aug. 28, up 11.6% in 24 hours and nearly 99% over 30 days, with trading volume exceeding $2 billion.
