Ethena Labs ENA Launches at $1 Billion Market Cap Post Airdrop As “Sats Campaign” Kicks Off

Ethena Labs has become the fifth-largest stablecoin issuer by market capitalization hours after the launch of its ENA token. 

Ethena Labs has airdropped 750 million ENA tokens, or 5% of the total supply, to early adopters, amassing a $1 billion market cap in the process. Its USDe synthetic dollar also has a market cap of over $1.6 billion.

Tuesday’s much awaited airdrop comes after six weeks of Ethena’s Shard Campaign, or points system, which began on Feb. 19. The campaign incentivized traders who posted collateral in exchange for future distribution of ENA. Those users are now able to cash out.

According to Coingecko, newly launched ENA token trades for $0.73, with a $1 billion market cap. The network’s fully diluted valuation topped a whopping $11 billion.

ENA is now available for trading on Binance, Bybit, Kucoin, and a number of other exchanges.

Ethena Labs’ has touted the token as a core component to its governance structure, and the beginning of the protocol’s move towards decentralization. The 5% distributed today belongs to the overall 30% allocated to Ecosystem Development.

Season 2 Begins Today

April 2 marks ENA’s airdrop but also the kick-off to a second phase of Ethena’s incentives program, which it calls its Season 2, or “The Sats Campaign.” In this phase, the project will onboard Bitcoin as collateral for the protocol, in addition to Lido’s stETH.

Bringing BTC into the Ethena ecosystem will open the gates for Bitcoin perpetual futures, unlocking roughly $25 billion of open interest to delta hedge, wrote the team today. The $25 billion represents a 2.5x increase on the current size of ETH perpetual futures.

Delta hedging is an options trading strategy that aims to reduce the directional risk associated with price movements in the underlying asset by taking an opposite position.

Ethena’s team explained that with year-to-date funding on Bitcoin reaching 22% on $25 billion, this should translate to roughly $2.75 billion in annual gross cash flow, thanks to half of open interest getting paid to short sellers.

USDe, Ethena’s synthetic stablecoin, backs the token that is pegged to $1, with staked Ethereum, while also hedging stETH with short ETH positions on centralized exchanges. Both stETH and short positions contribute to yield that’s passed on to stablecoin holders.

The architecture has been lauded by many in the crypto community–while triggering LUNA PTSD for its double-digit yield.

The Sats Campaign will run for five months, until Sept. 2, or until USDe supply reaches $5 billion. It currently sits at $1.6 billion, and will also benefit participants in Season 1 through boosted rewards.

New Season, New Partnerships

The team has also announced a plethora of new partnerships, activating today.

Last week, MakerDAO announced a $100 million DAI allocation to pools of lending protocol Morpho for USDe and sUSDe (staked USDe), deploying the Spark DAI Morpho Vault. Users earned seven times the shards on their USDe collateral, and five times the shards on their sUSDe collateral, wrote Ethena’s team.

Season 2 will bring even larger multiples for users that deposit collateral, up to 20x on USDe and 5x on sUSDe.

Pendle Finance, is a DeFi platform that enables users to tokenize and trade future yield on Ethereum assets, and is already a core component of Ethena’s liquidity pools. As part of Season 2, it will re-open its existing USDe Pendle pool today for users, expanding its cap to $100 million.

Additionally, Ethena will integrate Ethereum Layer 2 scaling solution Mantle Network, featuring new Pendle liquid staking pools on Mantle. Integrating these platforms will offer users the option to earn in Sats, as well as Eigenlayer points–a platform that allows for Ethereum stakers to stake ETH across platforms, now adding Ethena to its options. To earn sats or points, users can acquire USDe on Mantle, or provide liquidity to pools.