New Currency - Presenting ENA

5 min read

Ethena is a synthetic dollar protocol built on the Ethereum blockchain. It aims to provide a crypto-native solution for a stable money system that doesn't rely on the traditional banking infrastructure. This initiative includes a globally accessible dollar-denominated savings instrument, known as the "Internet Bond". Ethena is designed to offer a stable, decentralized financial instrument that enables users to save and transact in a currency pegged to the US dollar, but without the need for traditional banks. This makes it an interesting addition to the landscape of digital currencies, especially for those looking for alternatives to traditional savings and monetary systems.

Token Details

  • Native Token - ENA
  • Token standard: ERC-20
  • Total Token Supply: 15,000,000,000
  • Initial Circulating Supply: 1,425,000,000

Protocol Overview

ENA functions as an open hedge fund with a total value of 1.3 billion US dollars, employing liquidity-backed ETH as collateral to create an equivalent short position in ETH. This strategy ensures a portfolio with a delta of 0, maintaining the overall asset value despite market fluctuations. Moreover, it generates revenue through financing against the ETH collateral and short positions.

By leveraging an equal nominal value of short positions against pledged ETH, Ena enables the minting of US dollars with a 1:1 collateral ratio. This approach ensures capital efficiency akin to stablecoins backed by USD assets (like USDC and USDT) while circumventing dependence on traditional financial markets.

Protocol Overview

Advantages & Risks

  1. Scalability
  2. Stability
  3. Resistance to censorship
  1. Decoupling Risk from Collateral
  2. Financing Rate Risk
  3. Counterparty Risk
  4. Integrity Risk
Advantages & Risks

Considering a total token supply of 15 billion, reaching a price of 0.45 USDT would result in a Fully Diluted Valuation (FDV) of 6.75 billion USD.

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