The Ethena team is facing a "credibility" crisis. Is using 180 million ENA to earn Sats intended to dilute rewards?

Original author: Nomad, community user

Original translation: Felix, PANews

 

Ethena, the Ethereum stablecoin synthetic dollar project, has not yet gotten rid of the doubts of "the next LUNA", and has recently suffered a "credibility crisis". A community user posted on the X platform questioning the use of 180 million ENA to earn Sats in Season 3, diluting the rewards of other participants. The following are the details.

 

The Ethena team is using 180 million ENA tokens (25% of the SENA supply to earn Sats) in Season 3 Sats liquidity mining, which actually dilutes the rewards of other participants. This move has caused great concern about the ethics of the team.

 

Timeline of evidence:

 

August 22: Coinbase announced that its Prime service will become the primary custodian of ENA tokens for Ethena Labs and Foundation.

 

August 23: The Coinbase Prime custodian address received more than 3 billion ENA tokens, which exceeded the total circulation of ENA at the time according to Ethena's vesting plan. There is reason to believe that this is the Coinbase Prime custodian address for ENA tokens locked by the Ethena Labs core team and the Ethena Foundation.

 

October 3rd: When SENA staking launched via the S2 airdrop, the Coinbase Prime Custody address distributed 180 million ENA tokens to six wallets:

 

· Day 1: 2 transfers (30m and 35m ENA)

 

· Next days: 4 transfers (35m, 30m, 25m, 25m ENA)

 

The Ethena sats leaderboard shows:

 

 

These SENA can earn not only Sats, but also Ethereal Points (the DEX in partnership with Ethena will be launched in late 2024). The chart below shows that the Ethena team’s SENA has currently accumulated 20% of the total Ethereal points.

 

 

This is not the first time these suspicious addresses have raised questions. This was the most voted-on question in Ethena’s first community call, but the Ethena team chose to ignore it completely, which speaks volumes about the team’s moral character and attitude.

 

 

The Ethena team’s ethics have always been questionable, having previously changed vesting rules at will. Users who participated in S1 mining may remember that the Ethena team forced them to stake 50% of their vested tokens halfway through the vesting schedule. Users who participated in S2 mining suffered losses due to a 30-day average USDe holding rule that was implemented at the last minute. S2 YT holders almost suffered huge losses when they were about to be subject to the same average holding rule.

 

As a CeDeFi project, it is largely a black box in nature. Users have no choice but to believe the numbers released by the Ethena team. No one really knows how much revenue and staking income Ethena has earned from its $2.6 billion user fund, or whether all of it has gone to SUSDe holders. While it is critical for a protocol like Ethena to establish solid trust with users, the team's past performance has run counter to this philosophy.