Coinbase and Ethena tease a bigger push as ENA gains speed

Coinbase Ventures has purchased ENA tokens on the open market as Coinbase and Ethena prepare a new partnership focused on on-chain finance and savings products.

Ethena said in an official X post on Tuesday that Coinbase Ventures made its first disclosed open-market investment in the protocol’s ENA token, while Coinbase and Ethena also agreed to work together on products for Coinbase users. The company said the first growth initiative from the partnership will launch next week, though it did not name the product.

Coinbase Ventures takes public ENA position

Coinbase Ventures confirmed the purchase in a separate X post, saying it backed Ethena through an open-market buy of ENA. The venture arm said Ethena plays a key role in on-chain finance and added that it expects closer work between Ethena, Coinbase, and USDC.

The transaction differs from the usual venture model used by Coinbase Ventures. According to Coinbase Ventures’ website, the firm has made more than 600 investments across crypto and web3 since its launch in 2018, with most deals involving seed or early-stage private rounds.

In this case, Coinbase Ventures bought ENA from the public market rather than through a discounted private allocation. Ethena did not disclose the number of tokens purchased, the average price, or any wallet addresses tied to the transaction.

Ethena partnership targets Coinbase users

According to Ethena’s announcement, the partnership will focus on expanding on-chain finance and savings products to Coinbase’s user base. Ethena said Coinbase has more than 100 million users, a figure Coinbase previously reported after crossing 100 million verified users in 2022.

The partnership could bring more attention to Ethena’s main products, USDe and sUSDe. USDe is Ethena’s synthetic dollar asset, while sUSDe is the staked version designed to generate yield.

Coinbase reported $294 billion in platform assets at the end of the first quarter. Ethena did not say whether the upcoming launch will involve USDe, sUSDe, ENA, or a separate Coinbase product.

Ethena’s TVL and revenue remain in focus

According to DefiLlama data cited in the announcement context, Ethena holds about $5.4 billion in total value locked. The USDe contract accounts for about $4.5 billion of that amount.

Source: DefiLlama

DefiLlama data also show Ethena is generating $178 million in annualized fees. The protocol has generated $972 million in cumulative fees and $332 million in cumulative protocol revenue since Ethena Labs was founded by Guy Young in 2023.

ENA, the protocol’s governance token, has a market capitalization of about $859 million and a fully diluted valuation of roughly $1.4 billion, based on the same market data.

ENA rises after the announcement

Market data showed ENA rose 8.3% over the past 24 hours after the announcement. DefiLlama showed 24-hour ENA trading volume of $168 million.

Source: Coinglass

At the same time, DefiLlama showed $178 million in on-chain ENA volume through Uniswap V3 and Aerodrome. The reported on-chain volume exceeded the centralized exchange flow during the period.

Ethena and Coinbase have not provided more details on the product expected next week. Coinbase already serves as the primary custodian for ENA held by the Ethena Labs core team and Foundation under a previous Coinbase Prime agreement.