Ethena Labs Secures Fresh Funding From ArkStream Capital, ENA Price Spikes

Ethena Labs has secured fresh funding from ArkStream Capital as it expands its ecosystem in decentralized finance. The funding coincides with a 12% increase in the ENA price following the announcement.

ArkStream Capital Backs Ethena Labs Again

ArkStream Capital confirmed an additional $10 million investment in Ethena Labs. This adds to the $5 million funding made at the end of 2024. The company pointed to Ethena’s quick progress in joining capital markets and developing new products as reasons for this continued support.

The investment further demonstrates ArkStream’s confidence in Ethena’s dual-track strategy. This strategy combines equity-based capital vehicles with a crypto-native, decentralized protocol.

The firm claims that this has strengthened the connection between the adoption of the USDe stablecoin and ENA token governance by creating a “flywheel effect.”

Ethena’s USDe synthetic dollar has experienced notable growth. By the end of August, supply had crossed $12.5 billion, making it the third-largest stablecoin. Its delta-neutral yield model generates annualized returns between 9% and 11%. The market is also recognizing it as a “quasi-risk-free” rate for DeFi.

The use of USDe on major lending platforms has also increased significantly. Aave reported that $4.7 billion is now linked to Ethena-related assets. The daily trading volumes and revenue growth indicate that USDe is becoming a significant asset for collateral and settlement.

Furthermore, Ethena is adding USDe directly to platforms like Telegram by using the TON Blockchain. This move could give billions of users access to yield-bearing digital dollars, making crypto financial products available worldwide.

This investment joins other previous investments in the DeFi firm. MEXC previously invested $20 million into Ethena’s synthetic dollar, USDe. This investment was made to support the broader adoption of stablecoins.

ENA Price Jumps Amid New Funding and Buyback Initiatives

The ENA Price has risen more than 12% over the past day, outpacing the majority of the cryptocurrency market, according to CoinMarketCap data. The announcement and its recent buyback program may have contributed to the rally.

Source: CoinMarketCap; ENA Price Daily Chart

A $260 million buyback program led by the Ethena Foundation has been a major reason for its price surge. The Foundation made $5 million in daily purchases, steadily removing tokens from circulation. This is similar to capital return strategies commonly seen in traditional equity markets.

In August, addresses with between 100,000 and 1 million ENA increased their holdings by 12%. This indicates that major investors are committed to the long term, even though some money is shifting into exchanges, suggesting that some investors are taking short-term profits.

In other developments, the Defi firm has started making moves to target both settlement and distribution layers. Ethena Labs announced a partnership with Anchorage Digital. They aim to launch USDtb, a GENIUS-compliant stablecoin for the U.S. market, making it one of the first issuers to align with the incoming regulatory framework.

On the settlement front, Ethena has co-developed Converge Chain, a modular blockchain designed to use USDe and USDtb as gas and settlement assets. ENA staking will secure the network. This would help ensure that the token’s value is closely tied to the growth of financial activity on the chain.