Wintermute is pushing for Ethena fees to be changed to benefit sENA token holders

Crypto market maker and liquidity provider Wintermute has proposed a fee change framework for the Ethena protocol.

The main objective of this decision is to establish revenue alignment with SENA token holders and clarify the revenue structure of the Ethena protocol.

Wintermute Fee Change Proposal

According to Wintermute, SENA holders – those who have staked their Ethena tokens – are not directly benefiting from Ethena’s revenue growth despite the protocol’s success with the USD-pegged stablecoin, USDe. The latest proposal, submitted to the risk committee on Wednesday, suggests allowing future revenue allocation to sENA to align token holders with Ethena’s financial performance.

Although the proposal refrains from providing specific figures for revenue allocation or a detailed fee change model, Wintermute recommended that Ethena focus on establishing the “optimal shape” for the fee change , especially given the growth in USDe supply and the competitiveness of yields for the assets involved.

Wintermute also suggests establishing a roadmap with clear milestones – like circulation and revenue goals – before implementing revenue sharing. To support this, they are asking the Ethena Foundation for full disclosure on how the protocol’s revenue is currently and will be distributed. Any final decision on the proposed changes would require approval through a vote of ENA and sENA holders.

“We are asking the Foundation to clarify whether 100% of the Ethena Protocol’s revenue has been allocated or retained solely for the benefit of the Protocol to date. Additionally, we request confirmation that future revenues will continue to be managed under the Ethena Protocol, ensuring that they will benefit the protocol and remain governed by ENA/sENA.

USDe of Ethena

Ethena is a synthetic dollar protocol on Ethereum that issues the USDe stablecoin, designed as a scalable, censorship-resistant digital currency pegged to USD.

This year, USDe has gained ground, offering returns of up to 17%, prompting comparisons to Terraform Labs’ UST, the controversial algorithmic stablecoin that collapsed and sparked a broader crypto crisis more than two years ago. However, market experts have assured that the return mechanism of USDe is “unique”.

Currently, the market cap of USDe has reached $2.83 billion, driven by a broader crypto market rally.