Ethereum News Today: Hayes Bets on ENA as DeFi Awaits Rate Cuts

Arthur Hayes, co-founder of BitMEX, has made a significant move into the Ethena (ENA) token, investing $1.01 million to purchase 1.395 million ENA tokens within an eight-hour period. On-chain data from Ember shows that Hayes transferred 1.01 million USDC to exchanges Binance and Flowdesk, acquiring ENA at an average price of $0.73 per token. This purchase is part of a broader shift in Hayes’ investment strategy, which includes a re-entry into Ethereum after an earlier attempt to time the market proved unsuccessful. Following a short-lived sell-off last week, in which he offloaded $8 million in ETH, Hayes has now redirected capital to rebuild his position in Ethereum and other assets [1].

The move into ENA aligns with a broader trend of capital inflows into decentralized finance (DeFi) tokens, particularly as investors anticipate changes in interest rate policies. Hayes has publicly stated that DeFi could attract more capital after interest rate cuts, potentially pushing the price of ENA above $1.50 [2]. This sentiment is supported by recent developments in the ENA ecosystem, including a significant $530 million financing round led by StablecoinX and TLGY Acquisition. The funding, part of a private investment in public equity (PIPE) transaction, aims to strengthen the Ethena ecosystem and deepen ENA liquidity. The combined entity, to be renamed StablecoinX Inc., will hold over 3 billion ENA tokens and is expected to be the first treasury business dedicated to the Ethena protocol, which issues the USDe and USDtb stablecoins [3].

The Ethena protocol, launched in early 2024 by Ethena Labs, has rapidly gained traction in the stablecoin market. According to Binance Research, USDe has become the fastest stablecoin to surpass $10 billion in supply, reaching $12.6 billion in September 2024. The growth of USDe has been driven by the project’s innovative delta-neutral hedging model, which captures yield from crypto markets to maintain the stablecoin’s peg to the U.S. dollar. The Ethena Foundation, which oversees governance and development, reported over $500 million in cumulative revenue as of August 2024, with recent weekly protocol earnings exceeding $13 million [3].

Hayes’ recent investment in ENA also reflects a broader strategic pivot within the crypto market. After initially forecasting a drop in Ethereum to $3,000 and Bitcoin to $100,000, Hayes reversed his stance as both assets defied his expectations. Instead of continuing with a profit-taking plan, he reallocated $6.85 million across Ethereum, LDO, ETHFI, and PENDLE, signaling confidence in the market’s resilience. This reversal highlights the challenges of short-term market timing, even for experienced investors [1].

As the Ethena ecosystem continues to expand, the recent PIPE deal and buyback program indicate growing institutional interest in the project. With new investors such as YZi Labs, Brevan Howard, and IMC Trading joining the funding round, the Ethena protocol is well-positioned to further solidify its role in the stablecoin market. The development of the fiat-backed USDtb stablecoin is also expected to align with the U.S. GENIUS Act, which provides a regulatory framework for global stablecoin compliance [3].

Source:

[1] Arthur Hayes Reenters Ethereum After Mistimed Sell-Off (https://cryptodnes.bg/en/arthur-hayes-reenters-ethereum-after-mistimed-sell-off/)

[2] Arthur Hayes spent $1.01 million to buy 1.395 million ENA (https://m.odaily.news/en/newsflash/447176)

[3] TLGY and StablecoinX Secure $530M PIPE as Ethena’s USDE Becomes Fastest Stablecoin to $10B Supply (https://cointelegraph.com/news/tlgy-and-stablecoinx-secure-530m-pipe-as-ethena-s-usde-becomes-fastest-stablecoin-to-10b-supply)