ArkStream Capital said on X(Twitter) that it put in an extra $10 million into Ethena Labs in August 2025, building on a prior $5 million commitment from December 2024.
The firm said the move follows strong growth in Ethena’s stablecoin USDe and a plan that links a crypto protocol with a U.S. equity vehicle.
ArkStream called the approach a “dual-track flywheel” that pairs token-based cash flow with regulated capital to drive long-term demand.
ArkStream ups its stake
ArkStream said the new funding reflects confidence in Ethena’s recent product work and its progress in capital markets. The firm noted both usage gains and institutional signals as reasons to increase support.
ArkStream described the investment as part of a long-term strategy rather than a short-term bet.
What the dual-track model looks like?
Ethena aims to pair a decentralised protocol with a U.S. equity structure. On the equity side, the plan calls for a merger with a SPAC and roughly $360 million in PIPE financing, with a view to listing on NASDAQ under the ticker USDE.
Ethena also announced a $ 260 million ENA token buyback, which ArkStream says ties equity moves to on-chain demand.
On the token side, USDe’s supply has climbed rapidly. ArkStream said USDe topped $12.5 billion by the end of August. The protocol has generated over $500 million in cumulative revenue.
Aave’s exposure to USDe-related assets stands near $ 4.7 billion. ArkStream pointed to a fee-switch debate that could let tokens claim a share of protocol cash flow.
Also Read: Ethena and TON Introduce Synthetic Dollars to Telegram’s Crypto Economy
ArkStream argued these parts form a loop, and equity financing could boost buyback demand.
Buybacks and token demand could support USDe growth, and that expansion could drive protocol revenue and draw institutional allocations, which in turn could feed back into both token and equity value.
Distribution and settlement moves
Ethena plans to expand beyond stablecoins into tools for settlement and distribution. It aims to offer an institutional version of USDe that fits traditional finance systems. It is also working on a version for large messaging platforms to reach mass users.
The company wants these products to lower compliance friction and ease integration with banks and platforms.
Ethena is building a settlement chain that uses USDe as a native asset for fees and transactions. The project, co-developed with Securitise, plans to combine modular technologies to support both permissioned and permissionless uses.
ArkStream said a native settlement role for USDe would raise its utility and support real-world asset issuance and market making.
Institutional signals and reserves
ArkStream highlighted outside moves that it sees as validation, and one listed company, named ENA, as its strategic reserve for a token-backed unit.
ArkStream said such allocations act like long-term buyers and help stabilise demand across cycles.
StablecoinX fundraising and buyback plan
Ethena-linked vehicle StablecoinX said it raised an additional $530 million as part of an ENA accumulation plan. That brings total PIPE proceeds to about $895 million.
StablecoinX expects to hold more than 3 billion ENA tokens at closing. The plan also includes a roughly $310 million buyback over the next 6 to 8 weeks, carried out by third-party market makers, which the group says will further align token and shareholder interests.
Risks and ArkStream’s view
The protocol’s model relies on delta-neutral trading and funding spreads. Extreme market swings could cut yields or push short-term reversals, and Ethena uses multi-exchange deployment and hedging to lower those risks.
As USDe becomes bigger, lending platforms must set risk weights and governance rules to limit systemic strain.
ArkStream set out three time frames for its thesis, and in the short term, USDe is a large yield pool. In the medium term, SPAC and PIPE steps aim to bring regulated capital into the loop. In the long term, fee returns and reserve allocations could create a stable channel for value capture.
What comes next?
ArkStream said its extra investment backs Ethena’s move from product-market fit to a capital-market fit. The firm expects the next weeks and months to test whether token demand, equity flows, and institutional reserves can hold together.
Ethena’s plans will face scrutiny from markets and regulators, but ArkStream says it is willing to back the experiment as it unfolds.
Also Read: Ethena’s USDe Supply Jumps 75% To $9.3 B, Overtakes FDUSD As 3rd Largest Stablecoin