TL;DR
- Wintermute has proposed a governance change to reward Ethena (sENA) token holders by introducing a “fee switch” to allocate a portion of Ethena’s revenue directly to them.
- The proposal aims to ensure a fair distribution of Ethena’s revenue, addressing the gap between the protocol’s financial performance and the benefits for staked token holders.
- Wintermute emphasizes the need for transparency and accountability in the revenue allocation process, urging Ethena’s risk committee to set clear parameters and disclose historical revenue distribution.
Wintermute, a prominent crypto market maker, has recently put forth a governance proposal aimed at enhancing the benefits for staked Ethena (sENA) token holders. The proposal, submitted on November 6, 2024, seeks to address the disconnect between Ethena’s revenue growth and the rewards received by sENA holders.
By introducing a “fee switch,” Wintermute aims to allocate a portion of Ethena’s revenue directly to sENA stakeholders, thereby aligning their interests with the protocol’s success.
Key Features of Wintermute’s Proposal
The core of Wintermute’s proposal is the activation of a fee switch that would ensure a fair distribution of Ethena’s revenue to sENA holders. This initiative is designed to bridge the gap between the protocol’s financial performance and the benefits accrued by those who have staked their tokens.
Despite Ethena’s impressive revenue generation, which includes a market capitalization exceeding $2.8 billion for its US dollar-pegged stablecoin, USDe, sENA holders have not been directly benefiting from this growth. Wintermute’s proposal does not specify the exact percentage of revenue allocation or the mechanism for distributing fees to sENA stakeholders.
Instead, it calls on Ethena’s risk committee to determine the optimal structure and guidelines for the fee switch. This includes considering the growing supply of USDe and its competitiveness in the market.
Transparency and Accountability
In addition to the fee switch, Wintermute has emphasized the need for transparency and accountability in the revenue allocation process. The proposal requests that Ethena’s risk committee provide clear parameters for activating the fee switch, such as the circulating supply of USDe, protocol revenue levels, and adoption rates on major trading platforms.
Furthermore, Wintermute has urged the Ethena Foundation to disclose historical revenue distribution and commit to ensuring that future allocations benefit the protocol and its stakeholders. Wintermute’s proposal represents a significant step towards aligning the interests of sENA holders with the growth of the Ethena protocol.
By introducing a fee switch and advocating for greater transparency, Wintermute aims to create a more equitable and rewarding environment for those who support the protocol through staking.
