OAK Research analysis warns Ethena's growth depends on institutional partnerships as yield compression and delayed fee switch implementation pressure ENA token.
Regulation & Gov ·
OAK Research has published an analysis examining Ethena's trajectory, concluding that institutional partnerships are now central to the protocol's growth prospects as yield compression and delayed infrastructure projects constrain the ENA token. Over the past three years, Ethena pursued multiple initiatives including a proprietary chain, a fee switch mechanism, an in-house perpetuals exchange, and a Stablecoin-as-a-Service offering, though OAK Research's review found that not all generated measurable traction. The analysis carries disclosed conflicts of interest: OAK Research previously worked with Ethena through August 2025, lost a bid for a seat on Ethena's Security Council, and holds ENA acquired on the open market and through referral programs, which the researcher notes represent a minor portfolio share.
The core pressure points identified include stalled product launches and yield deterioration in USDe. Converge, an EVM-compatible settlement layer announced in March 2025 with partners including Pendle and Morpho, never shipped to mainnet despite an original end-of-Q2 2025 target. Terminal Finance, a spot DEX incubated by Ethena and designed as Converge's liquidity hub, returned all $280 million in pre-launch deposits and cancelled its launch entirely in November 2025 after Converge failed to materialize. Meanwhile, sUSDe's yield compressed sharply following the October 10, 2025 liquidation event—the largest single-day deleveraging on record—falling from an average of 6.58% APY to 4%.
The fee switch, a core tokenomic mechanism promised for three years, remains undeployed, further limiting ENA utility and revenue generation. OAK Research's implied assessment is that without executed institutional deals and a reversal of yield trends, the protocol faces constrained near-term catalysts.