Let's talk about what #ENA is today?

Ethena is simply a synthetic dollar protocol built on the Ethereum network.

It uses Ethereum (ETH) as the underlying asset to create a stable synthetic dollar (USDe).

This mechanism is implemented through spot ETH and futures ETH short collateral, ensuring that the value of USDe remains stable regardless of ETH price fluctuations.

How does Ethena make money? Assuming that you invest a certain amount of stETH (the pledged version of Ethereum), Ethena will use these stETH to mint USDe of corresponding value.

Then, Ethena will open a perpetual contract short position of ETH against USD (such as USDT or USDC) equal to the minted USDe on the centralized exchange (CEX) to hedge risks.

The stETH you invest will not be placed directly on the exchange, but will be handed over to custodians such as Copper, CEFFU, and Cobo for management, which can ensure the safety of assets and avoid asset losses caused by problems with the exchange.

There are two main ways for Ethena to make money. One is the income obtained by staking PoS, which is relatively stable, about 3.2% annualized. The other is the funding fee and basis spread obtained from the Delta hedging derivatives position, which may be higher, with an annualized income of 5% to 30%.

In general, Ethena is a platform that can continue to make money, and its token (ENA) is also very potential. With the rapid development of the LSD field of liquidity staking derivatives, especially the innovation in the field of LSD stablecoins, Ethena and its related projects are worthy of attention and long-term holding

#ENA解读

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