The Ethena Foundation said Friday that Wintermute's proposal to alter how Ethena protocol revenue is shared has been approved by the risk committee.
"The Ethena Foundation is pleased to share that the Wintermute proposal to enable an ENA fee switch has been approved by the Risk Committee," the foundation said in a post to X. "The Foundation will be working with the Risk Committee to crystallize parameters for fee switch activation by 30th November, with precise implementation mechanics to follow."
The announcement of Wintermute's proposal gaining approval comes a little over a week after the crypto market maker suggested the amended framework that would see the protocol allocating a portion of Ethena protocol’s revenue to programs related to staked ENA.
USDe is Ethena’s U.S. dollar-pegged stablecoin while sENA is the staked Ethena governance token. Wintermute's proposed a plan to allocate a portion of the Ethena protocol revenue for sENA and related programs is meant to solve a perceived disconnect.
“The Ethena Protocol has and continues to generate substantial amounts of real revenue, indicating a clear level of [product-market fit] for USDe,” Wintermute said in its proposal. “Unfortunately, sENA does not directly benefit from this revenue, resulting in an explicit disconnect between sENA holders and the growth of the protocol.”
Ethena Foundation responded the next day, saying it acknowledged "the potential benefits to the overall protocol and ecosystem associated with the proposal." Additionally, the foundation said that "100% of future revenue earned by the Ethena protocol" will accrue "to the benefit of the protocol and will not be shared with any 'Labs' or development services provider entity, including but not limited to Ethena Labs."
It also said the "use of Ethena protocol revenue for specific purposes outside of sUSDe rewards and the Reserve Fund would be determined via governance."
Last week, Wintermute called on the foundation to transparently disclose the historical allocation of protocol revenue, to ensure it has only benefited the protocol. Additionally, the company requested confirmation that future revenue will continue to serve the protocol's interests and remain under the governance of ENA and sENA.
Wintermute is a backer of Ethena, alongside Binance Labs, Fidelity Investments and Dragonfly, according to its website.
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