$ENA is the primary utility token for the Ethena platform, an Ethereum based stablecoin project whose USDe is pegged to the US dollar. Users stake USDe with Ethena and earn a return.

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By offering innovative solutions for stablecoin creation, yield generation and decentralized banking, Ethena is tackling the TradFi world.

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What is Ethena?

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Ethena is a decentralized protocol built on the Ethereum blockchain. It is designed to offer a crypto-based alternative to traditional banking services.

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It leverages blockchain technology to provide financial products that are accessible, transparent, and efficient.

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1. Delta-neutral synthetic dollar (USDe): Ethena's flagship product is a stablecoin that maintains its peg through sophisticated delta hedging strategies, ensuring stability even in volatile market conditions.
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2. Embedded yield generation: The protocol incorporates yield-generating mechanisms, allowing users to earn returns on their assets without the complexities often associated with DeFi yield farming.
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3. Globally accessible USD-denominated bonds: Ethena introduces the concept of "Internet Bonds," providing a decentralized alternative to traditional fixed-income products.

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Ethena prioritizes security through the use of on-chain Multi-Party Computation (MPC) custodial contracts. This approach eliminates the need for centralized servers in custody management, significantly reducing the risk of single points of failure and enhancing overall system security.

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Ethena is a synthetic dollar protocol built on Ethereum that provides a crypto-native solution for money not reliant on traditional banking system infrastructure, alongside a globally accessible dollar denominated rewards instrument - the 'Internet Bond'.

Ethena Overview

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What is $ENA?

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$ENA is the governance token of the Ethena ecosystem, it plays a crucial role in the Ethena network's operations and governance. ENA is also important to the security of the protocol and users are incentivized to stake the token.

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• Governance: $ENA token holders can participate in the protocol's decision-making processes, voting on proposals that shape the future of Ethena.

• Committee Appointment: Token holders are responsible for appointing members to various committees on a rotating basis. These committees handle specific aspects of the protocol's governance, allowing for more efficient and informed decision-making.

• Network Operations: The token facilitates various operations within the Ethena ecosystem, including staking and fee payments.

• Staking: Users can stake ENA tokens to earn rewards, incentivizing long-term engagement with the Ethena ecosystem

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$ENA token holders participate in Ethena governance voting on topics such as risk management framework, partnerships and technical integrations.

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• Ticker: ENA‍
• Circulating Supply: 2,937,500,000
• Total Supply: 15,000,000,000
• Contract Address: CzLSujWBLFsSjncfkh59rUFqvafWcY5tzedWJSuypump

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Just under 20% of the total token supply has entered the market since launching in Q2 2024. Mandatory vesting will foster long term growth for contributors, investors and the team through Q2 2028.

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What is USDe and Delta Hedging?

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USDe is a synthetic dollar stablecoin developed by Ethena Labs, designed to maintain a 1:1 peg with the US dollar. Unlike traditional stablecoins that rely on centralized reserves, USDe utilizes a unique mechanism to maintain its stability. USDe's stability is maintained through a combination of delta hedging strategies and a mint-redeem mechanism.

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The stablecoin is collateralized by Ethereum or liquid staking tokens, ensuring that each USDe is backed by crypto assets.

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Delta-hedging is the core mechanism used by the Ethena Finance to develop synthetic stablecoin. This technology opens short positions in derivatives equal to the value of Ethereum that was deposited as collateral.

And, makes sure that the value of USDe remains stable and any price movements of the underlying asset are counterbalanced.

CoinGape

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Delta hedging is a sophisticated risk management strategy used in options trading to reduce risk with price movements of the underlying asset (USD in this case). Ethena's strategy leverages the derivatives market to provide yields while maintaining stability of the stablecoin.

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What is Ethena Labs?

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Ethena Labs is the parent company of Ethena and $ENA. They are focused on creating innovative financial products like the USDe stablecoin. They have attracted high profile investors such as Fidelity, Franklin Templeton and Wintermute.

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Although they have been building for years, their public mainnet launched more recently in February. The team has continued to build since then and are in a constant state of expansion.

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They recently partnered with crypto derivatives exchange Deribit to offer USDe as rewarding margin collateral. Users will be able to earn rewards simply for holding USDe.

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