Standard Chartered sees ENA rising sevenfold to $2 by 2028 if USDe rebounds

Standard Chartered initiated coverage of Ethena's ENA token with a $2 year-end 2028 target, up from about $0.28 currently. The bank forecasts ENA reaching $0.42 at the end of 2026 and $1.10 in 2027. The bank's projection would leave ENA outperforming its expected gains for Bitcoin and Ethereum over the same period. The forecast depends on Ethena reversing a contraction that has cut USDe supply by more than half from its peak. USDe exceeded $10 billion after launching in late 2023. Ethena's original strategy combined long spot crypto positions with short perpetual futures to capture funding payments while keeping market exposure largely delta-neutral. The strategy sometimes generated returns above 20%, attracting deposits into USDe and its yield-bearing counterpart, sUSDe. As the trade became more crowded and funding rates compressed, USDe supply fell to about $4.9 billion. Standard Chartered estimates Ethena's blended yield across its strategies is now about 5.2%. The bank expects USDe supply to reach $40 billion by 2028, well beyond its previous peak. Ethena now also seeks yield through DeFi lending, institutional lending, liquid stablecoins, real-world assets and basis trades tied to equities and commodities. Standard Chartered expects tokenized assets, including stablecoins and other real-world assets, to reach about $4 trillion by the end of 2028 from roughly $350 billion currently. The bank projects real-world assets deployed on blockchains rising from about $40 billion to $2 trillion over the same period. A larger tokenized-asset market could give Ethena more collateral and yield opportunities beyond crypto derivatives. Ethena is also building white-label stablecoins and Ethena Pay. Standard Chartered expects those businesses to broaden Ethena's revenue base. Ethena's approved fee-switch framework begins at $7.5 billion of USDe supply, above its current level. Under the approved framework, 95% of qualifying net revenue paid to the Ethena Foundation from covered businesses goes toward ENA buybacks. Ethena does not retain the full yield generated by the assets supporting USDe. Blockworks Advisory's analysis modeled the protocol's share of gross revenue rising from about 5% at $7.5 billion of USDe supply to 20% at $20 billion. The Blockworks Advisory model used a 6% protocol yield as an illustrative assumption, not a guaranteed return. Standard Chartered estimates that at $40 billion of USDe supply, annual ENA purchases could equal roughly 23% of the token's current market value if its price stayed unchanged. The bank argues that investors would price expected purchases into ENA, raising its valuation and reducing annual buybacks as a percentage of market capitalization. Standard Chartered cites Uniswap as an analogy, saying UNI's annualized buyback percentage settled around 3% to 4% as its price rose after its fee switch activated. Applying a comparable level to Ethena underpins the bank's $2 target. However, directing more of Ethena's revenue toward ENA purchases could reduce the yield available to sUSDe holders. Ethena needs enough revenue margin for buybacks while keeping yields competitive enough to attract deposits. The illustrative 6% yield is not guaranteed across market cycles, and the higher revenue-capture levels remain untested at the bank's projected scale. USDe must first pass the $7.5 billion fee-switch threshold and regain its previous peak. Ethena must then show that its newer strategies can handle tens of billions of dollars without materially reducing returns.