Standard Chartered is bullish on Ethena: ENA's market value may increase 7 times in 2028

According to Woofun AI, Standard Chartered is strongly bullish on the ENA token in the Ethena ecosystem, predicting that its market capitalization growth potential in 2028 will surpass Bitcoin and Ethereum by a large margin. The agency officially incorporated ENA into the investment analysis framework and set a clear price path: starting from the current low of around $0.28, it is expected to rise to $0.42 by the end of 2026, further climbing to $1.10 in 2027, and eventually reaching the target price of $2 by the end of 2028.

This forecast implies huge room for ENA's market value to rise about seven times in four years. The core logic is whether Ethena can successfully reverse the shrinking trend of USDE in its synthetic dollar business and rebuild the growth engine through diversification strategies. Standard Chartered believes that if Ethena can achieve this transformation, its token performance will be significantly superior to traditional crypto asset giants, but this depends on whether a series of stringent business expansion and financial thresholds can be broken through one by one.

The current contraction of the USdE business poses the biggest real challenge, and its supply has fallen above its peak level to around $4.9 billion. Looking back at the end of 2023, USdE rapidly rose with the strategy of “lengthening spot cryptocurrency positions while shorting perpetual contract futures”, and its market capitalization once surpassed $10 billion. This strategy once provided high returns of more than 20% during market fluctuations, attracting large inflows of capital into usDE and its profitable version, susDE.

However, as market conditions changed, this high-yield environment no longer existed, and the USdE scale shrunk drastically. According to data compiled by Woofun AI, the comprehensive yield of Ethena's strategies is currently only about 5.2%, which is far below the historical high. Standard Chartered Bank's forecast is based on a key assumption: USDe's supply must recover and expand to $40 billion by 2028.

This means that Ethena will not only have to return to its peak level of $10 billion, but will also need to grow by about four times on top of that. This jump in scale does not simply rely on the original crypto derivatives strategy, but rather requires Ethena to completely restructure its revenue stream structure to support larger asset accumulation against the backdrop of declining underlying returns.

To cope with the depletion of crypto's native earnings, Ethena is accelerating the diversification strategy of revenue sources, which has become the core basis for Standard Chartered Bank to be optimistic about its long-term value. The current strategy portfolio has been expanded to DeFi lending, institutional lending, stable liquidity stablecoins, and real-world assets (RWA), and new trading strategies linked to stocks and commodities have been introduced. Standard Chartered Bank's macro forecast shows that the size of the tokenized asset market (including stablecoins and other RWA) will surge from about $350 billion today to around $4 trillion by the end of 2028;

Meanwhile, the size of RWA deployed on the blockchain will rise from around $40 billion to $2 trillion. This massive market expansion will provide Ethena with abundant collateral and revenue opportunities, so that it no longer relies too much on abnormally high perpetual contract futures financing rates to maintain expansion.

In addition, Ethena is also deploying customized stablecoins and Ethena Pay services in addition to the synthetic dollar business, with the aim of further broadening revenue channels. Standard Chartered believes that the collaborative development of these non-core businesses will help Ethena gain a place in the broader financial infrastructure, thereby reducing the risk of dependency on a single crypto market cycle.

The core of the valuation model lies in the triggering and sustainability of the repurchase mechanism, which faces strict threshold tests. Ethena's current fee adjustment mechanism stipulates that it will only start when the USdE supply reaches $7.5 billion, and 95% of the eligible net revenue from related businesses will be used for ENA token buybacks.

Notably, the value of $7.5 billion is still below the starting threshold for revenue mechanisms to come into play in Standard Chartered Bank's valuation model. Blockworks Advisory's analysis indicates that as the USdE grows, the agreement's share of total revenue will increase significantly: from about 5% at $7.5 billion to 20% at $20 billion. Standard Chartered Bank uses an agreed yield of 6% as a reference assumption. If USDe reaches $40 billion and the price does not change, the annual capital used to repurchase ENA may account for 23% of its current market value.

However, this high percentage of repurchases is difficult to sustain. Investors will include expected repurchases in the valuation, driving up the token price and reducing the share of repurchases. Based on Uniswap's performance after implementing the fee adjustment mechanism, its annual repurchase ratio eventually stabilized between 3% and 4%. Standard Chartered Bank set a target price of $2 based on a similar balance. However, the risk is that if the agreement withdraws too much revenue for repurchase, it will weaken the benefits left to susDE holders, which in turn affects capital attractiveness. Therefore, investors need to pay close attention to whether USdE is the first to break through the $7.5 billion threshold and verify the revenue stability of the new strategy on a multi-billion dollar scale. The speed of breaking through these key points will determine whether the repurchase mechanism predicted by Standard Chartered Bank can actually be implemented.