The Ethena Foundation recently made an important announcement regarding the approval of Wintermute’s proposal to revamp revenue sharing within the Ethena protocol. The decision, which was made by the risk committee on Nov. 15, is set to benefit staked ENA (sENA) holders and is expected to be implemented by the end of November pending finalization of the details.
Wintermute, a well-known market maker and supporter of Ethena, put forth the proposal in order to address what they saw as a disconnect between sENA holders and the revenue-generating success of the protocol. Despite the significant growth in revenue seen by the Ethena protocol, sENA holders have not reaped the benefits directly.
The proposed changes aim to create better alignment between sENA holders and the financial outcomes of the protocol. Wintermute highlighted the need for this alignment, stating that sENA holders currently lack a direct connection to the revenue growth of the Ethena protocol.
One of the key changes suggested by Wintermute is the introduction of a mechanism to allocate a portion of Ethena’s revenue towards programs that enhance the utility and value of staked governance tokens. The foundation has committed to ensuring that all future revenues will exclusively benefit the protocol, with no funds flowing to external entities or affiliated development groups.
Transparency regarding past revenue allocations is also a focus of the proposal, with the foundation pledging to adhere to this principle moving forward. All earnings will be subject to community governance through ENA and sENA voting structures.
The Ethena Foundation is currently working with the risk committee to finalize the details of the new revenue-sharing model, with activation parameters expected to be in place by the end of November. The ecosystem of Ethena has garnered support from industry giants such as Binance Labs, Fidelity Investments, and Dragonfly, in addition to Wintermute. This latest development is aimed at strengthening the relationship between governance token holders and the overall performance of the protocol.
Overall, the approval of Wintermute’s proposal signifies a step towards aligning incentives across the Ethena ecosystem and could set a precedent for how governance protocols address stakeholder alignment and revenue transparency. Stay tuned for more updates on this exciting development within the Ethena protocol.