The leading cryptocurrency exchange, Binance, has announced Ethena as the next project featured on their Binance Launchpool staking platform.
Until April 1, you can earn Ethena (ENA) tokens on Binance simply by staking your BNB or the FDUSD stablecoin. You can withdraw the coins you’ve staked at any time and keep the ENA token rewards.
You can earn ENA on Binance Launchpool between March 30 and April 1. The amount of token rewards you earn will depend on how many coins you stake.
Earn ENA Token on Binance
Binance plans to distribute 2% of the total ENA token supply to users on Launchpool. This translates to 300 million ENA tokens out of a total supply of 15 billion tokens.
80% of these rewards will be distributed to BNB stakers, while the FDUSD staking pool will receive 20% of the rewards. However, this doesn’t necessarily mean that you will earn more ENA if you stake BNB rather than the stablecoin. It all depends on how big the size of your stake is relative to the size of the entire staking pool.
Introducing @ethena_labs $ENA on #Binance Launchpool! Farm $ENA by staking #BNB and $FDUSD. ➡️ https://t.co/1VIrENbi2v pic.twitter.com/ZHiJ5eYCwc
— Binance (@binance) March 29, 2024
In addition to featuring the ENA coin on its Launchpool platform, Binance will also be listing ENA for trading on the Binance exchange. The token will be available for trading starting on April 2 in trading pairs against BTC, USDT, BNB, FDUSD, and TRY.
It is worth noting that Binance will be listing ENA with the “Seed Tag,” which is used to label crypto projects that are still very early in their development. Cryptocurrencies with this tag were previously known in the “Innovation Zone.” The purpose of the Seed Tag is to let users know that the cryptocurrency might be more volatile and risky compared to most other cryptos listed on the exchange.
What is Ethena (ENA)?
Ethena is a synthetic dollar protocol that aims to provide crypto investors with dollar-denominated savings based on blockchain. The team calls this savings product the “Internet Bond.” The protocol’s primary synthetic asset, USDe, is meant to achieve 1-to-1 price parity with the US dollar by delta-hedging staked Ethereum collateral. Delta hedging is an options trading strategy that looks to mitigate risks associated with price movements of an underlying asset – in the case of Ethena, that’s ETH.
According to the whitepaper, the Internet Bond generates yield in two ways. First, delta hedging of derivatives positions against ETH held by the protocol ensures USDe’s peg. Second, the Internet Bond combines yields collected from staked ETH and “the funding & basis spread from perpetual and futures' markets.”
Users can mint USDe by providing stETH or some other supported crypto asset as collateral. The collateral asset is then automatically swapped for the corresponding amount of USDe. The redemption process is just an inverted variation of the minting process, with users picking the asset they want to receive in exchange for their USDe, and the smart contract does the rest.
It’s worth noting that USDe can be staked to generate additional yield. Users who stake USDe receive an equivalent amount of StakedUSDe (sUSDe), which automatically accumulates staking rewards as long as it is held. The rewards are represented by the increasing value of sUSDe over time. After USDe is unstaked, a user receives the original amount of staked USDe in addition to staking rewards that are paid out in USDe.
At the time of writing, it’s not exactly clear what the role of the ENA token will be. In our opinion, and given its similarity to some other protocols in the market, the most likely use case will likely be governance-oriented. If that is indeed the case, ENA could be used to allow holders to participate in governance decisions, such as deciding on the extent of USDe staking rewards, the ratio of futures and options contracts used for delta-hedging, and similar.
How to earn ENA tokens on Binance Launchpool
If you want to earn Ethena, the first thing you’ll need is a Binance account.
Create Binance Account
Please keep in mind that only users who complete an identity verification process with Binance are eligible to participate in Ethena token farming on Binance Launchpool.
Once your account is ready, you’ll need some BNB or FDUSD tokens to stake. If you already own these tokens, you can deposit some to your Binance account. Otherwise, Binance offers plenty of ways of buying these tokens with either crypto or fiat.
After your account is verified and loaded up with some BNB and/or FDUSD, head over to the menu on the top side of the Binance interface and select "More". Then, go to "Launchpad & Launchpool".
Then, find the available Ethena farming pools. Depending on which tokens you want to stake, select the FDUSD Pool or BNB Pool. Then, follow the instructions provided by the exchange.
As a final note, here’s a quick breakdown of key dates and information about the Ethena Launchpool campaign:
Ethena (ENA) Launchpool Start Date March 30, 2024, 00:00 (UTC) End Date April 1, 2024, 00:00 (UTC) BNB Pool Daily Rewards 80,000,000 ENA FDUSD Pool Daily Rewards 20,000,000 ENA ENA Listing April 2, 2024, 08:00 (UTC)
