Original author: Nomad

Original text translated by: Felix, PANews

The Ethereum stablecoin synthetic dollar project Ethena has not shaken off the doubts of being the 'next LUNA', recently facing another 'integrity crisis'. A community user posted on the X platform questioning the use of 180 million ENA to earn Sats in Q3, diluting the rewards of other participants. Below are the details.

The Ethena team is using 180 million ENA tokens (25% of the SENA supply) to earn Sats through Q3 Sats liquidity mining, which effectively dilutes the rewards of other participants. This has raised significant concerns about the team's ethics.

Evidence Timeline:

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

August 23: Coinbase Prime custody address received over 3 billion ENA tokens, exceeding the total circulating supply of ENA at that time according to Ethena's vesting plan. There is reason to believe this is the Coinbase Prime custody address for ENA tokens locked by the core team of Ethena Labs and the Ethena Foundation.

October 3: When SENA staking was initiated through the S2 airdrop, the Coinbase Prime Custody address distributed 180 million ENA tokens to six wallets:

  • Day One: 2 transfers (30 million and 35 million ENA)

  • The following days: 4 transfers (35 million, 30 million, 25 million, 25 million ENA)

Ethena sats leaderboard shows:

These SENA not only earn Sats but also Ethereal points (the DEX in partnership with Ethena will be launched by the end of 2024). The image below shows that the Ethena team has currently accumulated 20% of the total Ethereal points.

These suspicious addresses have not raised questions for the first time. In Ethena's first community call, this was the most voted question, but the Ethena team chose to completely ignore it, which fully illustrates the team's ethical quality and attitude.

The ethical conduct of the Ethena team has long been questionable, having previously changed the vesting rules at will. Users participating in S1 mining may remember that the Ethena team forced them to stake 50% of their vesting tokens midway through the vesting plan. Users participating in S2 mining suffered losses due to the last-minute implementation of the 30-day average USDe holding rule. S2 YT holders faced significant losses when they were about to be bound by the same average holding rule.

As a CeDeFi project, it is largely essentially a black box. Users have no choice but to trust the numbers released by the Ethena team. No one really knows how much profit and staking income Ethena has generated from the 2.6 billion dollar user fund, or whether all income flows to SUSDe holders. While building strong trust with users is crucial for protocols like Ethena, the team's past performance has been contrary to this principle.