Ethereum-based synthetic dollar protocol Ethena Labs has been accused of participating in one of its newly hosted crypto-farming events using 180 million Ethena tokens. 

On Oct. 27, crypto investigator Nomad alleged that the Ethena team owns 25% of the total staked ENA (SENA) in its Season 3 farming event, which is actively used for farming Sats, which are rewarded to users for participating in various actions in the Ethena ecosystem.

While questioning the team’s ethics, Nomad warned that the move would significantly dilute the rewards of legitimate participants, specifically Ethens ( ENA )/Ethena USDe (USDE) holders.

Ethena team accused of misusing 180M ENA tokens to farm Sats image 0

Source: Nomad

Ethena did not immediately respond to Cointelegraph’s request for comment on the allegations. However, the protocol denied the allegations of wrongdoing.

Six Ethena-linked wallets in question

According to Nomad, the Coinbase Prime Custody address had received over 3 billion ENA tokens in August, which were potentially locked ENA tokens for the Ethena Labs core team and the Ethena Foundation.

In October, six crypto wallets belonging to Ethena received 180 million ENA tokens from the Coinbase Prime Custody address following the SENA staking launch back in September. All six wallets have been featured on the Ethena leaderboard for Sats farming.

Ethena team accused of misusing 180M ENA tokens to farm Sats image 1

Source: Nomad

In addition to Sats farming, the wallets with possible links to the Ethena team also earned Ethereal (ETRL) rewards.

The investigators further alleged that the Ethena team’s 180 million staked ENA tokens accrued 20% of all Ethereal points dedicated to its community members. Nomad further highlighted the importance of trust when dealing with centralized finance entities:

“No one really knows how much funding revenue and staking revenue Ethena is generating from the $2.6 billion user fund or if it’s streaming all revenue to SUSDe holders.”

Ethena users suffered losses in previous staking events

The investigator also pointed out anomalies in Ethena’s previously hosted Season 1 and 2 farming events, negatively impacting its users, with many suffering financial losses.

The allegations against Ethena Labs garnered the interest of crypto community members on X, many of whom urged the protocol to respond.

According to Ethena, the staked ENA in question is unlocked foundation tokens that are eligible for participation. Furthermore, the protocol will provide further clarification as a way to counter the accusations.

Ethena team accused of misusing 180M ENA tokens to farm Sats image 2

Source: Ethena Labs

Related: Ethena’s risky path: A synthetic stablecoin cautionary tale

On Oct. 25, algorithmic trading firm Wintermute announced accepting Ethena’s USDe as margin collateral for crypto OTC trading .

As a result of the partnership, Wintermute’s clients can post “USDe as collateral for options, [credit default swaps], forward, and spot trading.”


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