Author: Azuma, Odaily
Ethena (ENA) may be one of the most eye-catching tokens in recent times.
According to Bitget's market data, since bottoming at 0.194 USDT in early September, ENA has surged to 1.33 USDT as of yesterday, a nearly 600% increase in just over two months.
There are multiple reasons for this. For example, the rising contract funding rates in the bull market have significantly boosted Ethena's protocol revenue, and the supply of USDe has also grown markedly; the buying support from the Trump family's World Liberty project; the expected opening of the ENA fee switch pushed by Wintermute; and the direct collaboration with BlackRock BUIDL to launch a new stablecoin product USDtb... In addition, the anticipated airdrops to holders and stakers of ENA are also seen as a key driver for the token's continued rise.
Previously, two major projects closely associated with USDe, Ethereal and Derive (formerly Lyra), have officially announced airdrops to sENA holders (i.e., ENA stakers), with Ethereal planning to airdrop 15% of its token supply and Derive 5%.
Ethereal: The First Airdrop Project in the Ethena Ecosystem
Ethereal made its debut on September 30th this year.
At that time, Ethereal's founder Fells proposed a plan on Ethena to build an on-chain trading venue supporting spot and derivative trading around USDe, where Ethena could benefit from the expansion of USDe's utility, while Ethereal could occupy a key position in the ecosystem early on.
Architecturally, Ethereal will serve as a Layer 3 built on the Ethena network; in terms of business, Ethereal will not only have a comprehensive trading system, but also support the deployment of other USDe-related applications (such as lending).
To gain the support of the Ethena community and deepen the binding relationship, Ethereal stated in its initial proposal that it would airdrop 15% of its tokens to ENA stakers.
Latest Updates: Learning from Hyperliquid
In the latest community call, the Ethereal team emphasized Hyperliquid and believed that the key to its success was "providing a comprehensive suite of trading services", solving the hidden pain point of users having to switch between different applications to execute different operations, which is more conducive to user and capital retention.
In this regard, Ethereal founder Fells re-described Ethereal's positioning as "a one-stop product supporting all DeFi operations", where users can trade spot or contracts, do rate arbitrage, borrow and lend, options, and even prediction operations, while also earning stable yield by leveraging sUSDe (staked USDe).
Fells added that Ethereal aims to be a platform similar to a CEX in terms of user experience, but will maintain full non-custodial and decentralized features. For example, Ethereal will abstract away the need to pay gas through specific design, so users don't have to sign for each transaction or pay gas fees.
Timeline: Mainnet Launch in Q1
According to the timeline mentioned in the call, Ethereal's development roadmap is as follows:
- Testnet release: expected next month;
- Testnet shutdown;
- Mainnet launch: expected in Q1 2025.
Falls also mentioned that Ethereal's concrete functions will be rolled out in phases, starting with USDe perpetual contract trading, followed by portfolio margin mode, lending, and spot trading, which will likely be launched in the first half of 2025. In addition, Ethereal will only support trading of a few blue-chip tokens initially, and will add new trading pairs on a weekly basis as user and liquidity accumulate.
Ethena's Ecosystem Expansion
Ethena's ecosystem is rapidly expanding. In addition to Ethereal mentioned in this article, Derive, the derivatives project formerly known as the options protocol Lyra, will also launch its token in the first quarter of next year and airdrop 5% of its tokens to sENA holders.
Buoyed by the positive sentiment in the bull market, the contract market's funding rates have remained high, driving up the yields of the Ethena protocol itself and sUSDe. As of the time of writing, the supply of USDe has approached $60 billion, with a real-time yield of 27%.
Meanwhile, the new stablecoin product USDtb launched by Ethena in collaboration with BlackRock BUIDL has also filled Ethena's biggest gap - the temporary negative yields of the protocol itself and sUSDe during negative fee rate periods. The structure of USDtb is similar to traditional RWA-backed stablecoins, with its stability supported by reserve assets and its yield coming from government bond rates. In the future, as the supply of this stablecoin grows, Ethena will have a reliable hedging window during negative fee rate periods or when the fee rate yield is lower than government bond yields, thereby resolving the protocol's vulnerability to negative fee rates.
Earlier this year, the renowned "Milk King" and founder of BitMEX, Arthur Hayes, predicted that "USDe will surpass USDT to become the largest US dollar stablecoin". Although the supply gap between the two is still tens of times, considering Ethena's continuously high yields and the rapid expansion of its ecosystem, this is not impossible. If this expectation is realized, the ecosystem sub-projects that have occupied the ecological hub position early on, such as Ethereal, will inevitably benefit, further feeding back value to ENA.
