Ethena Labs Boosts User Rewards by 50%
Ethena Labs has recently announced a significant increase in rewards for its users, as part of its “season 2” initiative. The platform is boosting rewards by 50% for select users, leading to a surge of 14% in the value of ENA, Ethena’s native token. Currently trading at $1.306, the token has experienced notable growth from its debut price of $0.64 just last week.
Enhanced Rewards for Users
- Users locking in their ENA for a minimum of seven days are eligible for increased rewards.
- Individuals locking 50% or more of their ENA relative to their USDe balance can benefit from the 50% reward boost.
This initiative is designed to encourage user engagement and contribute to strengthening Ethena’s ecosystem. Additionally, Ethena has implemented a strategy involving Bitcoin (BTC) purchases and short selling to generate annual yield through cash and carry trade, following a similar approach with Ethereum (ETH) since January.
“Ethena hedges represent ~20% of ETH open interest, with $25 billion of BTC open interest available for Ethena to delta hedge, indicating the potential for USDe to scale by over 2.5x,” developers at Ethena Labs explained.
The initial cap for ENA lock stands at $200 million, subject to future adjustments. However, the ENA lock is not applicable to team and investor allocations under locked vesting schedules.
Frax Finance Community Governance Proposal
- Frax Finance, a DeFi lending protocol, has passed a community governance proposal to allocate $250 million of Ethena Labs’ USDe to a new liquidity pool.
- This allocation aligns with Frax’s roadmap, establishing an automated market operation (AMO) for minting new FRAX tokens supported by overcollateralized debt.
- The goal is to create one of the largest liquidity pools in the DeFi sector and diversify Frax’s backing yield.
Closing Thoughts
With Ethena Labs increasing user rewards and Frax Finance expanding its liquidity pool, the DeFi space continues to witness significant developments. These initiatives aim to incentivize participation, strengthen ecosystems, and deepen liquidity in decentralized finance platforms. As users engage with these opportunities, they contribute to the growth and innovation within the DeFi sector.
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