Ethena Labs Denies Facilitating Crypto Farming Events Using 180M of Its Native Tokens

Popular Ethereum-based synthetic dollar protocol, Ethena Labs has responded to allegations of facilitating crypto farming events using 180 million of its

Popular Ethereum-based synthetic dollar protocol, Ethena Labs has refuted allegations that it facilitated a crypto farming event using 180 million of its native tokens.

In a post on its official X page on Monday, the protocol revealed that it is aware of the speculations.

We are aware of questions circulating in Discord and X as to whether investors or the Ethena team are earning Ethereal rewards via sENA using locked tokens.

We would like to categorically confirm to our community that absolutely no locked team or investor tokens are staked as…

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Through the post, Ethena Labs denied its involvement in any farming event. More so, the protocol explained that it didn’t lock any investors’ tokens in any earning rewards including Ethereal.

Moreover, the firm stated that the movement of funds from its wallets is due to the vesting schedule outlined in the token’s distribution model. The team revealed that the wallet contains some unlocked foundation tokens.

The protocol further added that the foundation confirmed that it won’t use the tokens for any farming activity including Ethereal. Meanwhile, $ENA, the native token of the protocol reacted negatively to the news, extending its price dip.

According to CoinGecko, Ethena is presently changing hands for $0.03343, which reflects a 5.6% dip in the last 24 hours.

How Nomad Highlighted Some WrongDoings by Ethena Labs

Recall that on October 27, 2024, crypto investigator Nomad accused the Ethena team of owning 25% of the total token staked in its Season 3 farming event. Don’t forget that the tokens are used for farming Sats as a reward to users for carrying out different activities in the Ethena ecosystem.

Alert: Important Notice for ENA/USDe Holders

The Ethena team is currently using 180M ENA tokens (25% of SENA supply that earns sats) to farm sats in Season 3, effectively diluting other participants' rewards. This raises significant concerns about the team's ethics.

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The expert went on to question the ethics of the team, raising concern that the move would significantly affect the rewards of the real participants most especially Ethens/Ethena USDe (USDE) tokens.

In his post, the expert disclosed that the Coinbase Prime Custody address received over 3 billion ENA tokens in August. Nomad alleged that the tokens were potentially locked $ENA belonging to the core team and the Ethena Foundation.

Last month, about six crypto wallets linked to Ethena received 180 million $ENA tokens from the Coinbase Prime Custody address after the launching of SENA in September. As revealed, all the wallets featured on the Ethena leaderboard for Sats farming.

Furthermore, these alleged wallets also received Ethereal (ETRL) rewards. Nomad accused Ethena of staking 180 million, receiving 20% of all Ethereal points committed to community members.

However, the blockchain security expert highlighted the need for trust when dealing with centralized finance entities. To back his claims, Nomad highlighted some shortcomings in the Season 1 and 3 farming events hosted by Ethena.

According to Nomad, the events had some financial implications on participants.