Proposal: Reduction of Risk Committee members from 5 to 3

Risk Committee
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After reflecting on how to best position the Risk Committee for success going forward, Ethena Labs Research is seeking to put forward a proposal for broad ENA tokenholder vote ahead of next week’s elections, suggesting a reduction in Risk Committee size from 5 to 3 voting members.

It is our strong belief that a reduction in Risk Committee members from 5 to 3 enables the following productivity and operational benefits:

  1. A smaller committee allows each member to take clearer ownership over specific areas, which we believe will lead to stronger accountability and more proactive engagement across proposals. For example, one member can oversee Ethena’s DeFi lending exposure, one member can oversee Ethena’s Reserve Fund and redemption requirements, and another member can oversee Ethena Protocol/Partner integrations and backing assets. At present, 5 members are spread across multiple risk categories and do not have ownership over one specific area. Clearer ownership also ensures no tasks are left unattended by members assuming another member will handle it.

  2. With fewer members, Ethena Foundation would be able to increase member compensation meaningfully, enabling members to dedicate more time and resources to Ethena governance and risk. Several members have expressed a willingness to hire Ethena specific team members and build Ethena-focused public resources such as dashboards and simulation tools if they had more budget to work with.

  3. While the sub-committee structure helped distribute work, we think a leaner group with well-defined responsibilities will ultimately be more effective in ensuring an equal workload between members. With 5 members, it was often the case that one or two members would handle the majority of the work as they were across multiple sub committees.

If this proposal passes via a majority vote from ENA and sENA holders, the usual election format would follow this vote, where ENA holders will elect the 3 voting members of the Ethena Risk Committee. Ethena Labs Research will be excluded as an option from this vote, and will continue to act as a non voting member in an advisory capacity to the Committee going forward.

If this proposal doesn’t pass, ENA holders will elect 5 voting members to the Committee as before.

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The Ethena Foundation can confirm this proposal will be put forward to a tokenholder vote.

Voting begins on the member reduction proposal tomorrow, Wednesday 28th January and will run until the end of day Monday 2nd February. The voting link will be added in the replies to this post shortly. Voting YES will be voting in favour of reducing Risk Committee members from 5 to 3.

In addition, and in advance of the upcoming Ethena Risk Committee elections, we would like to give all current and prospective members the opportunity to make their case for re-election below this post. Candidates are encouraged to showcase their work on prior proposals or protocol governance, outlining resources they would be able to dedicate to Ethena governance going forward, as well as any other ways they might contribute to the Ethena Risk Committee. We invite all suitably skilled and qualified candidates to apply for a position on the Committee in the upcoming elections.

Candidates should demonstrate:

  • Expertise in financial planning, investment management, risk management, or blockchain governance, and

  • Alignment with the mission and values of the Ethena protocol; and

  • No prior breaches of trust with any token community or conflicts of interest.

The Risk Committee member elections will begin on Tuesday 3rd February after the vote on risk committee size reduction concludes.

Newly shortlisted applicants will be subject to screening and background checks, and the Foundation may request additional information as needed, this includes the nominated individual for the applying entity.

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Snapshot voting link for this proposal:
https://snapshot.box/#/s:ethenagovernance.eth/proposal/0xb3d924c838c192007b4ddd8418b37b12189dcae3aee0ee4cd55d307abfad18f1

Please review and cast your vote before the voting window closes.

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To the Ethena stakeholders and the broader community,

LlamaRisk is standing for re-election to the Ethena Risk Committee as it transitions from a five-member to a three-member structure.
This transition places a premium on continuity, coordination, and clear ownership of high-stakes risk surfaces. During the current term, LlamaRisk has served not only as a contributor, but as a coordinating lead across reserve management and legal-governance risk — roles we intend to continue and deepen.

We are grateful for the trust placed in us throughout Term 3 and for the opportunity to help guide Ethena through a period of exceptional growth and market volatility. As USDe scaled rapidly, our focus has been on ensuring that growth was matched by rigor: transparent risk frameworks, conservative capital assumptions, and decision-ready analysis that continue to reinforce confidence in the protocol’s resilience and long-term sustainability.

Key Contributions During Our Term

During Term 3, we focused on scaling Ethena’s risk frameworks in step with protocol growth while strengthening transparency and governance coordination.

Reserve Fund Management and Monitoring

We led and coordinated ongoing analysis of the Reserve Fund as USDe supply expanded sharply, peaking at $14.8B TVL in October 2025. Our work has focused on ensuring that the Reserve Fund remains a credible backstop against tail-risk market events, rather than a static buffer.

To support this, we upgraded the Ethena Risk Monitoring Dashboard, dedicating a live page where the community can continuously observe our Reserve Fund capitalization recommendations alongside monthly reports. This tooling provides real-time visibility into protocol health and reinforces confidence in Ethena’s resilience to tail-risk events.

We maintained a consistent monthly cadence of Reserve Fund analysis, coordinating closely with Blockworks Research to align methodology and ensure coherent outputs to governance:

This work has helped shift Reserve Fund governance toward scenario-aware, stress-based capital adequacy, rather than reliance on fixed heuristics. By maintaining continuity across Reserve Fund methodology, stress-event analysis, and related legal and governance design, LlamaRisk has helped keep the reserve fund adequacy evaluation process optimized and focused as the protocol evolves and committee membership changes.

Response to Stress Events & Operational Resilience

We demonstrated the ability to respond rapidly and constructively to real-world stress events:

  • Following the October 10th USDe pricing dislocation on Binance, we published a detailed breakdown explaining the mechanics of the event, clarifying impacts, and separating transient market structure effects from protocol fundamentals.
  • We advised on the implementation of USDe last-resort redemptions directly on exchanges, introducing a critical safety valve that improves liquidity depth during extreme dislocations without undermining overcollateralization guarantees.

These efforts focused not only on diagnosis, but on structural improvements that reduce the likelihood and severity of future stress events.

Protocol Growth, Legal Diligence, and Governance Risk

We have actively supported Ethena’s secure expansion, balancing innovation with risk controls.

  • We provided structured risk input on upcoming backing asset integrations (proposals to be published soon), ensuring diversification improves resilience rather than obscuring correlated risk.
  • We conducted detailed legal and operational reviews of custodian integrations, including Kraken, Anchorage Digital, and Zodia, translating regulatory and custody constraints into actionable risk guidance for governance.
  • We have taken a leading role within the Legal Working Group, including driving the development of the risk terminology manual as part of the broader effort on fee-switch communication guidelines.

Importantly, LlamaRisk brings a unique skill set to the Risk Committee, with a specialized legal and regulatory risk capability embedded in its mandate. This has enabled close, ongoing collaboration with Ethena Labs’ legal team and external U.S. and BVI counsel, positioning us to translate legal constraints directly into protocol-level design and governance decisions.

Aave Integration & Cross-Protocol Risk Coordination

Ethena’s growth and risk profile are increasingly shaped by its close integration with Aave, including the deployment of USDe reserves into Aave markets and the promotion of Pendle markets that enable leveraged use of Ethena assets. These integrations are not peripheral; they are central to Ethena’s capital efficiency, liquidity dynamics, and user growth strategy.

LlamaRisk is uniquely positioned at this intersection. As the risk provider for Aave, we work closely with Aave governance, core contributors, and service providers on a continuous basis. This gives us a practical understanding of how risk decisions propagate across both ecosystems, and allows us to anticipate second-order effects that arise when Ethena and Aave strategies interact — particularly under stressed market conditions.

This cross-protocol perspective has direct risk relevance. Decisions around reserve deployment, leverage pathways, liquidation dynamics, and venue concentration cannot be evaluated in isolation when Ethena and Aave are tightly coupled. Our role enables tighter coordination, faster escalation when conditions change, and clearer communication between stakeholders on both sides.

Our Vision for the Next Term

If re-elected for Term 4, LlamaRisk will focus on owning and coordinating the risk surfaces most critical to Ethena’s next phase of growth — where strategy complexity, capital efficiency, and revenue durability increasingly intersect.

Scaling via Strategy Diversification

Ethena’s growth is no longer defined solely by balance-sheet expansion but by diversification of strategy primitives. This includes:

  • evaluating new hedging venues as well as hedging venue types,
  • assessing shifts from funding-rate-dependent delta hedging toward on-chain yield strategies and other diverse strategy allocations,
  • and understanding how execution, liquidity, and unwind dynamics differ across these strategy classes.

Our role is to ensure diversification improves systemic resilience, rather than introducing hidden correlations or brittle failure modes.

Adaptive Reserve Fund & Portfolio-Level Risk Modeling

As Ethena’s strategy mix evolves, the risk profile of the protocol changes materially. Reserve Fund modeling must therefore move beyond single-regime assumptions toward portfolio-level aggregation across heterogeneous strategies, each with distinct liquidity, convexity, and tail-risk characteristics.

We will continue aligning closely with Ethena Labs and our Risk Committee partners as yield opportunities evolve, ensuring that:

  • Reserve Fund models reflect the true risk distribution of deployed strategies,
  • capitalization recommendations remain credible under stress,
  • Ethena can pursue higher-quality yield and revenue opportunities without eroding market confidence.

This quantitative work is foundational to participant trust, competitive positioning, and long-term adoption. Clear, defensible risk frameworks reduce uncertainty for external market makers, integrators, and allocators, supporting deeper liquidity and broader adoption of Ethena products.

Optimizing sUSDe Unstaking & Liquidity Flows

A key focus for the upcoming term will be a careful re-evaluation of the sUSDe unstaking cooldown mechanics, which has been statically set at 7 days since inception. While this design choice was appropriate and conservative during Ethena’s early growth phase, it may be overly restrictive under current or prospective portfolio regimes.

As Ethena’s backing strategies and liquidity profile evolve, the duration risk of the underlying portfolio becomes a more relevant determinant of safe redemption timelines than static assumptions. Using quantitative modeling and stress analysis, it is possible to assess whether shorter, well-defined cooldown periods could be supported without increasing systemic risk, particularly during regimes where portfolio liquidity and unwind characteristics are demonstrably robust.

Our objective is to ensure that any adjustments:

  • remain consistent with Reserve Fund and redemption survivability assumptions,
  • preserve user trust and predictability,
  • and improve Ethena’s competitiveness and capital efficiency without sacrificing resilience.

Legal Engineering & High-Stakes Governance Transitions

The ENA fee switch represents a pivotal transition for Ethena, carrying legal, economic, and reputational risk. Having been involved in this work since its earliest stages, we are positioned to deepen our contributions to the legal engineering and implementation sequencing behind the fee switch mechanics, ensuring the mechanism is robust, compliant, and governance-ready. This will require close coordination and ongoing collaboration with Ethena Labs and the engaged U.S. and BVI counsels to ensure the structure is legally robust and implementation-ready.

In parallel, we will remain focused on all ongoing and future integrations and service provider engagements where Risk Committee approval is sought. Many of these initiatives benefit from an independent legal review or opinion, and this is an area where LlamaRisk is particularly well-positioned to lead and deliver value.

Closing

As the Risk Committee becomes more concentrated, Ethena benefits from members who can own ambiguous risk surfaces, coordinate across technical and legal domains, and provide continuity under stress. LlamaRisk has played this role throughout the current term, and we are committed to continuing it as Ethena enters its next stage of maturity.

We look forward to continuing our partnership with the Ethena community, Ethena Labs, and our fellow Risk Committee members.

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I’m not opposed to these kinds of decisions that optimize committee work.

However, any similar proposals should publicly discuss the decision and its implications—what the budget for the new committee will be, etc. This time, only a day has passed before the vote.
I believe at least five days should be allowed for discussion, allowing all interested parties to present their pros and cons.

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Risk Committee Election Application: OAK Research

To Ethena’s stakeholders and the broader community, OAK Research is honored to announce its application to join Ethena’s Risk Committee, with the objective of serving as an independent risk intelligence and transparency layer within the protocol’s governance framework.

As on-chain finance continues to scale and Ethena’s mechanisms grow in complexity, critical risk-related decisions become increasingly difficult to interpret and prioritise. The role of the Risk Committee should not be limited to observing isolated metrics, but rather to analysing the current market conditions, on-chain activity, and liquidity, assessing their systemic implications, and informing the protocol’s most structural decisions.

OAK Research’s goal with this proposal is to deliver factual, readable, and directly actionable analyses to all relevant stakeholders and the broader crypto community to reduce information asymmetry and provide better governance decisions with the best risk assessment.

Within a three-member Risk Committee, OAK Research does not seek to duplicate existing members’ duties. Our role is to do what we do best: transform raw data into actionable risk intelligence, and ensure that the committee’s decisions remain understandable, transparent, and relevant in the eyes of the community.

About OAK Research

OAK Research, launched in November 2024, is an independent research platform dedicated to the analysis of DeFi, stablecoins, RWAs, and broader crypto market developments. Its mission is to provide investors and market participants with a clear, data-driven understanding of crypto market dynamics.

Our platform combines data-driven reports, narrative and protocol-level analysis, and independent investment theses to deliver real-time insights and in-depth research.

We have worked alongside a wide range of DeFi and infrastructure protocols, including Maple, Pyth, Euler, Polygon, F(x) Protocol, and Plasma, to analyse their evolution, risk profiles, and structural design. This experience has enabled us to develop a deep understanding of protocol-level dynamics across multiple verticals and stages of maturity.

In this context, OAK Research proposes to implement a robust monitoring and analytics framework for the Ethena ecosystem. As Ethena scales and introduces greater structural complexity, through diversified backing assets and new strategic primitives, an independent and agnostic layer of analysis becomes critical.

Contribution: The Three Pillars of Oversight

OAK Research will act as a unification actor of the Risk Committee contributors by unifying, organising and coordinating the various governance proposals, data analytics, and core evolutions of Ethena’s protocol.

With the transition to a three-member Risk Committee, we will provide monthly updates on each subcommittee’s decisions, governance proposals and data points to take into account for the next months.

1. Market Dynamics & On-Chain Health

While existing industry-standard tools, notably the Blockworks Ethena Risk Dashboard, provide essential high-quality raw metrics, OAK Research’s primary objective is to bridge the gap between raw data, community understanding, and the important points to take into account going forward.

We aim to translate these complex data points into digestible insights, thereby enhancing protocol transparency and ensuring that Ethena’s evolution is accessible to all stakeholders, regardless of their technical level.

The following is a non-exhaustive list of the elements to be analysed and interpreted, leveraging the foundational work provided by available data dashboards.

  • Monitor the structural integrity of the USDe/sUSDe ecosystem.

  • Basis & Funding Analysis: deep dives into Funding Rates and Open Interest (OI) dynamics to assess the sustainability of the yield engine.

  • Cross-Venue Liquidity Mapping: Granular analysis of liquidity concentration across CEXs (Binance, Bybit) and DEXs (Hyperliquid, etc.) to detect shifts in market leadership.

  • Money Market Integration Monitoring: audit of USDe/sUSDe utilization rates, LTV, and liquidation thresholds on Aave, Morpho, and Spark. This also implies:

→ Strategic Audit: Evaluation of deployment costs vs. revenue per chain to identify underperforming or non-essential integrations.
→ Pendle Dependency: Tracking the percentage of TVL locked in Pendle to assess duration risk and exit liquidity concentration.

2. Governance Reporting & Transparency Enhancement

OAK Research will commit to publish monthly comprehensive reports on the governance forum, detailing the evolution of protocol health metrics. These reports facilitate a rigorous assessment of how prior governance decisions impact Ethena’s current operational state. These reports will also act as a monthly summary of the various activities of the subcommittees’ members.

While in the past these reports were crafter by the various members of the Risk Committee, our goal is to facilitate their publication by unifying the information and making it standardised.

OAK Research will act as an analytical filter to make the comprehension of major proposals clearer for token holders and other market participants. We would synthesise technical and economic stakes to ensure the community can rapidly understand the implications of each vote.

To guarantee maximum transparency, every analysis and report will be broadcasted through our dedicated channels:

  • OAK Research Platform: Publication of in-depth, long-form technical articles on the most important data and our implication in the Risk Committee.

  • Social Media & X: threads designed to inform stakeholders in real-time, ensuring governance data reaches a broader audience beyond forum regulars, while gathering input from the broader crypto community.

3. Macro Environment & Competitive Benchmarking

The objective of this pillar is to contextualize Ethena’s performance within the global financial ecosystem by anticipating external risk vectors and identifying market opportunities.

Yield Spread Analysis & Ethereum Staking Rate Competitiveness:

  • Yield Correlation: OAK Research would monitor the evolution of the native Ethereum staking rate (ETH Staking Rate) to assess its direct impact on the attractiveness of USDe returns. This monitoring extends to all yield-bearing collateral utilized by the protocol.

  • Flow Dynamics: Analysis of the competitiveness of the Basis Trade (funding rate arbitrage) relative to the DeFi Risk-Free Rate (native staking). The goal is to forecast TVL (Total Value Locked) contraction or expansion phases based on yield differentials.

Behavior During High Volatility Periods & Market Correlation:

  • Comparative Resilience Analysis: A comparative study of USDe behavior during extreme volatility episodes relative to its direct competitors.

  • Competitive Activity & Market Evolution (if applicable or relevant):
    → Market Share & Inflows: Continuous benchmarking of USDe growth against emerging synthetic dollar protocols and yield-bearing stablecoins.
    → Retention Analysis: Study of capital flows between protocols to identify potential market share erosion or emerging growth segments.

Regulatory Monitoring & Macro Risks:

  • ​​Legislative Tracking: Proactive monitoring of international regulatory developments specifically impacting synthetic stablecoins and passive yield products.

Ethena Alignment

OAK Research has closely followed Ethena’s evolution throughout 2025, beginning with the publication of a full week of in-depth content focused on Ethena’s protocol. Building on this initial work, we later partnered with Ethena to provide further insights into the ecosystem by publishing additional research on the protocol’s mechanisms and design choices.

Beyond research, we have actively contributed to ecosystem growth. To date, we have onboarded over 400 users to Hyena and were among the earliest partners supporting the HIP-3 DEX by helping onboard users to the protocol.

One of our research pieces was described as “the best overview of Ethena out there atm”. reflecting both the depth and clarity of our analysis. We have continuously tracked Ethena’s development, governance discussions, public communications, Guy’s publications, allowing us to maintain a comprehensive and up-to-date understanding of the protocol’s evolutions.

Through this sustained engagement, we have developed a deep understanding of Ethena’s architecture, its innovations within the broader crypto ecosystem, and the risk considerations required to make the protocol safer, more transparent, and more attractive to investors.

By applying to the Risk Committee, our objective is to deepen our collaboration with Ethena. We aim to contribute directly to strengthening the protocol’s role within the ecosystem through risk analysis, clear communications, and data-driven decision-making processes, while making governance processes more transparent.

Members managing our contribution

Within OAK Research, two members of the team will be allocated towards managing the Ethena Risk Committee’s position. Once the report is drafted, the rest of the team will include their comments to present the most comprehensible and complete report on the current state of Ethena and Ethena’s governance updates.

The whole team at OAK Research will be involved in the Risk Committee decision making process. The two members managing the reports will be:

→ YetAnotherAnon (prenomnom)

YetAnotherAnon is a researcher at OAK Research specialising in DeFi market microstructure and technical analysis. His work focuses on the economic sustainability of protocol designs and the quantification of market-driven risks.

DeFi Analysis & Risk Modelling: Since 2022, he has focused on the forensic analysis of decentralised protocols, evaluating financial mechanisms, risk parameters, and the structural integrity of yield-generation models.

Educational Synthesis: Leveraging his ability to analyse complex information, he has also authored technical reports for a leading French-speaking YouTube channel, focusing on high-level Bitcoin & DeFi education.

Within OAK Research, YetAnotherAnon has authored several research articles focusing on both on-chain and off-chain financial infrastructures, including a technical deep-dive into Pendle Finance, mapping the non-linear risks of yield-stripping and PT/YT liquidity dynamics, and an analysis of institutional-grade financial models, including the StrategyB infrastructure.

→ tx (tx_analysor)

Tx is a DeFi-focused analyst and writer at OAK Research, where he has been delivering independent research on DeFi protocols and broader crypto ecosystem dynamics for over three years. His work emphasizes protocol design, risk mechanisms, and structural evolution across decentralized finance.

He has authored in-depth analytical pieces on major ecosystems and protocols, including Euler, Ethereum, Polygon and many more. His research on F(x) Protocol was described by the protocol’s core team as one of the most comprehensive and high-quality analyses ever produced on the subject.

In parallel, tx has also contributed to the crypto section of Snowball, France’s leading financial newsletter for retail investors. This experience has strengthened his ability to translate complex DeFi and financial concepts into clear, accessible narratives for non-technical audiences, while maintaining the technical depth required to generate actionable insights for advanced stakeholders.

→ Rest of the team that will take part in the decision making process

Artem Sinyakin (Artem_Oak): CEO @ OAK Research that has over 6 years of experience in the crypto sector within Node Management company Meria, media company OAK Invest, and OAK Research. Artem focuses on Ethereum DeFi and yield-bearing stablecoins and protocols.

Lilian Aliaga (LilianAliaga_): COO @ OAK Research that has over 6 years in crypto in the largest French media Cryptoast. He is also the main author of the research pieces published on the OAK Research platform. He has extensive knowledge of DeFi protocols, stablecoins, and Prediction markets.

Maximilien Prue (MaximilienP51): Crypto Analyst @ OAK Research. Working full-time in the crypto industry for 4+ years, including experience at France’s leading crypto media outlet.

Decrypt: CTO @ OAK Research with extensive blockchain expertise since 2017. Web developer specialising in NextJS, React, and mobile development. Contributor to DeFiLlama and Cryptoast, focusing on innovative cryptocurrency solutions. Open source contributor passionate about blockchain technology.

Five-Member to Three-Member Structure

OAK Research supports transitioning Ethena’s Risk Committee to a three-member structure, as we believe this configuration will materially improve governance efficiency and decision-making quality. While we were not members of the Risk Committee in the previous term, we have closely followed prior discussions and proposals on the governance forum and have incorporated our findings into our proposal.

We strongly believe that our participation can make the governance process more transparent, involve more community members and token holders, while clearly communicating the rationale behind Risk Committee decisions.

Although governance is often viewed as a bottleneck to growth, we take the opposite view. Making governance more accessible and transparent is essential for Ethena to sustain long-term growth and innovation, while integrating insights from the broader crypto community.

A three-member Risk Committee structure allows each member’s contributions to be more impactful, improve coordination and communication, and enable more efficient allocation of resources. This includes deeper engagement in governance participation, enhanced data analytics, and continued development in collateral onboarding and venue selection, while maintaining a healthy DeFi risk profile.

We strongly believe that OAK Research can play a meaningful role within this new structure and contribute positively to the future development of Ethena.

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Blockworks Advisory is seeking to continue its work on the Ethena Risk Committee for a fourth consecutive term. With this application we want to demonstrate the analytical rigor that has defined our contributions, and the enhanced capabilities we’ll bring to the next term.

Since governance launched three terms ago, in June 2024, Blockworks Advisory has taken a proactive, leading role in the Ethena Risk Committee, helping enable Ethena’s growth from $3.5B to $15B TVL at peak. We owned and led a large part of the analyses within the committee’s quantitative risk frameworks. We achieved this not through conservative blockers or gut feel assessments, but through systematic frameworks built on rigorous quantitative analysis. We deliver infrastructure where we show exactly when, how much and under what conditions.

What sets us apart

1. We build infrastructure

  • Dynamic models that adapt to real time market conditions (see example in demonstrated impact).
  • Live dashboards covering everything from USDe risk and DeFi footprint to Ethereal and Hyena. Risk Dashboard, USDe Transparency, sUSDe and its Term Structure, ENA Token, DeFi Footprint and more.
  • Reusable frameworks that governance and internal team can deploy independently (see example in demonstrated impact).
  • Interactive calculator apps (like our Ethena - Aave model) that let anyone stress test allocations in real time. Calculator App
  • Ongoing bespoke research by our Research and Advisory teams, elevating distribution and gaining visibility from institutional audiences. Forecasting Market Regimes with sUSDe Term Structure

2. We bring statistical rigor to risk analysis

Beyond standard funding rate comparisons, we provide:

  • Autocorrelation patterns across exchanges
  • Extreme event duration analysis
  • Regime specific behavior under stress
  • Statistical distributions with p95/p99 tail modeling

Example: Our SOL collateral analysis didn’t just compare averages, we identified that Deribit shows 8 day negative funding events while Binance rarely exceeds 3 days. That level of granularity protects the protocol.

Together with LlamaRisk, we devised a comprehensive framework for determining the appropriate size of the Reserve Fund, which is updated and published monthly.

3. We enable growth

Our philosophy is that rigorous data driven risk assessment creates safe expansion pathways.

  • Coinbase INTX: Lower median funding rates, yes. But also 4× more stable distributions, enabling strategic rotation during volatility.
  • Aave backing: We didn’t just say “it’s risky”, we built a dynamic stress responsive framework showing exactly when to scale up (49% cap currently safe, 35 - 60% range robust). Based on this analysis, we built the dashboard which shows how Aave’s allocation performs based on our dynamic recommendation and allows anyone to explore how different market conditions affect this allocation. We also integrated our findings into Blockworks’ global dashboard on Ethena, for improved risk transparency.
  • Maple integration analysis: Identified that liquidity collapses in the left tail despite healthy medians, preparing for events of thin available liquidity.

4. Real time risk management at scale

Our dashboards serve as operational tools for real-time risk monitoring:

  • Financial dashboard covering all major metrics
  • Asset specific monitoring (USDe, sUSDe, USDtb, ENA)
  • Integration tracking (DeFi Footprint, Whitelabel SaaS)
  • Risk charts with live parameters

This infrastructure means governance can act on data.

Our commitment and resources for the 4th term

With this election we not only renew our commitment to safeguarding Ethena’s growth, but strengthen it. The committee has consolidated from 5 to 3 members and this consolidation allows us to do more with greater focus and coordination. With increased responsibility, we will be able to allocate more resources than before, leveraging not just our specialized risk expertise, but the full Blockworks machine:

  • Our research team’s market intelligence.
  • Our data infrastructure for onchain analytics.
  • Our communication platform for transparent governance.
  • Faster response times, dedicated risk team members, and deeper quantitative analysis.

Demonstrated impact

Strategic risk assessments that enabled protocol evolution:

  • Aave backing asset integration: Provided comprehensive risk assessments that enabled USDe to safely evolve beyond pure delta-neutral collateral, incorporating diversified DeFi yield opportunities including money market positions. This strategic expansion allowed the protocol to scale effectively across varying market conditions, particularly during periods of negative funding rates, while maintaining rigorous risk parameters. Risk Analysis: USDe Backing Assets on Aave
  • Custodian framework development: Developed comprehensive custodian evaluation frameworks, successfully onboarding new custody providers (Kraken, Anchorage Digital, Zodia) without compromising standards. Custodian Onboarding Framework
  • Market stress analysis: Provided risk assessment during market stress events, including detailed post-mortems on USDe backstop performance and liquidity dynamics. USDe Analysis during the Oct 10th-11th Volatility Event

Deep quantitative analysis examples:

  • Dynamic Aave cap model: Stress tested across 1,400 data points, accounting for Pendle PT dynamics and time-weighted risk, built interactive calculator for dynamic cap modeling. Dynamic Cap Model

  • Funding rate analysis: Full distributional analysis (mean, median, std dev, kurtosis, skewness) across BTC/ETH/SOL and 5 exchanges, identified Deribit’s 8-day negative funding events vs Binance’s 3-day maximum. Onboarding SOL, Integrating Coinbase INTX

  • Maple integration study: empirical analysis of pool level data analyzed, identified that liquidity collapses to 0.2x coverage in the left tail despite healthy medians, providing critical input to allocation design before deployment (internal analysis).

  • Ethena cooldown study: 752 days analyzed, identified a potential framework for a dynamic cooldown period, conditional on available liquid cash, which would provide a better user experience while maintaining risk standards (internal analysis).

Amplification examples:

This is the standard of work that helped protect Ethena through $15B in growth and what allows for scaling safely. Blockworks Advisory provides systematic and quantitative risk management that enables growth and we look forward to helping Ethena navigate the opportunities and challenges ahead as the protocol continues to scale.

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Kairos Research: Risk Committee Election Application (Re-Election)

Kairos Research is running for re-election to keep Ethena’s risk posture strong as the protocol enters its next growth phase which we believe will be driven by HyENA and Ethena’s Stablecoin-as-a-Service offering. We bring a native understanding of derivatives markets, a mechanics-first risk mindset, and a track record of communicating risks clearly and succinctly to the community. In a three member committee, we aim to be the decisive seat through fast analysis, clear thinking, and actionable recommendations. We also plan to ensure protocol value is adequately captured and returned to ENA holders via the right mechanisms.

Who we are

We launched Kairos Research in January 2024 after working on the Growth & Listings team at Binance US, where we evaluated protocol mechanics that map directly to the core risks Ethena seeks to understand and properly navigate: liquidity, integration, legal, technical, and operational risks.

Kairos Research is dedicated to publishing comprehensive, data-driven analysis on the major risk areas within the DeFi landscape. Our research spans critical sectors, including lending markets, liquid staking, restaking protocols, and stablecoin design. Beyond research, we are actively involved in governance, serving as a top delegate for ether.fi and playing a significant role in Jito’s governance workstreams related to tokenomics and incentives. Our collaboration with FirstSet on operating validators for Solana, Fogo, Monad, Celestia, and Babylon provides us with valuable, real-world experience that significantly enhances our understanding of operational risk.

Team Leads:

Ian: Co-Founder of Kairos Research.former Protocol Specialist at Binance US; key Jito governance delegate focused on cryptoeconomic design and sustainable value-capture mechanisms.

Teddy: Co-Founder of Kairos Research; investment associate (Chicago family office); BBA Finance (Ross); CAIA Level I; former research analyst at Binance US.

Why Kairos fits a 3-member Risk Committee

A smaller committee only works if each member has a distinct edge. Ours is simple:

  1. Growth-Centric Approach: We recognize that risk is an inherent and necessary component of growth, not an isolated factor. Whether pursuing new product lines, adding an additional venue, or approving new backing assets, growth fundamentally requires the willingness to take risks.

  2. Robust Mechanisms and Incentives: Our approach is mechanics-first, emphasizing risk mitigation through the design of robust incentives and mechanisms.

  3. Clarity Under Pressure: We turn risk decisions into plain-English reasoning the community can easily understand.

Helping Ethena through the next wave of growth: HyENA + Stablecoin-as-a-Service

HyENA and Stablecoin-as-a-Service expand Ethena’s distribution, and thus expand the risk surface area. We’ll help Ethena scale safely by focusing on:

  • Ensuring USDe’s stability to allow for the most capital efficient margin collateral and help foster the internet trading engine.

  • Ensuring SCaaS partners can grow confidently and capture more value via yield to their respective ecosystems through USDtb and USDe backed stablecoins.

  • Frictionless governance comms: Clear monthly reporting on what’s changing across partners/integrations and what it means for protocol resilience.

Closing

As Ethena enters a rapid scaling phase, its distribution growth could outpace the adaptability of conventional risk frameworks. Kairos Research is seeking re-election to the Risk Committee to actively support Ethena’s expansion through HyENA and Ethena’s Stablecoin-as-a-Service offering. Our goal is to appropriately navigate this next chapter of growth while making sure long-term protocol sustainability remains top of mind, and ensure value is captured and directed back to ENA for tokenholders.

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Summary

Credio (by Untangled) is a risk adviser and oracle. We have been a member of the Risk Committee, bringing our risk modelling, protocol engineering, and asset evaluation expertise to most of the community proposals over the last 12 months. We are standing for re-election to the Ethena Risk Committee.

Contributions

Over the last two terms Credio (by Untangled) was the Lead/Core Contributor to 10 out of 11 proposals (the total number of proposals on the forum). The single proposal we did not contribute was Reserve Fund and related work, given Credio is not a member of the subcommittee.

There were works completed but not yet published in the forum. The section below contains links to our contributions.

ALL proposals in the Forum:

  1. Ethena Backing Asset Framework: Lead/Core Contributor (link)
  2. Apply Ethena Backing Asset Framework to onboard XRP, BNB, HYPE: Lead/Core Contributor (link to X tweet by Ethena Foundation)
  3. Adding Kraken, Anchorage Digital and Zodia as Eligible Custodians for the Backing Assets of USDe: Lead/Core Contributor (link)
  4. USDe Redeem for Dislocations on Secondary Markets: Lead/Core Contributor
  5. Monthly governance update Sept and April 2025: Lead/Core Contributor (link)
  6. Ethena Allocation Assessment: Backing assets into Morpho (Steakhouse Vaults): Lead/Core Contributor (link)
  7. Ethena Allocation Assessment: Backing assets into Morpho / Spark USDC Vault on Base: Lead/Core Contributor (Link)
  8. Ethena supplying USDtb to Aave, and subsequent requests to increase the supply cap: Lead/Core Contributor
  9. Assessment of Coinbase INTX as an eligible hedging venue: Lead/Core Contributor
  10. Ethena supplying USDC/T to Aave, in response to Aave’s proposal, and subsequent requests to increase the supply cap: Lead/Core Contributor
  11. Add PYUSD and USDG as a USDe Backing Asset and Eligible Asset for the Reserve Fund/ Allocating a portion of excess Reserve Fund assets to USDe backing/ Reserve Fund Subcommittee Monthly Update: No (Credio is not part of Reserve Fund Sub-committee)

Work completed but not yet published:

  • Ethena Allocation: Assessment of additional curator on Morpho

  • Ethena Allocation: Assessment of another lending market which includes an institutional lending business

  • Assessment of another CEX as an eligible hedging venue (work completed, pending publication)

Why Credio?

We differentiate and complement other Risk Committee members in the following three areas:

  • Ownership, accountability and responsiveness: As demonstrated above, Credio was the Lead/Core contributor to almost all proposals. There were instances where we were the only contributor, partly due to our ability to provide swift responses when urgently needed by Ethena.

  • Builder to builder: We are builders ourselves, with our vault and lending infrastructure protocols. These enables capital allocators/curators to efficiently allocate to existing yield sources as well as creating new ones.

  • Quantitative and qualitative: As demonstrated in our contributions above, our work is heavily quantitative and data-intensive, powered by in-house risk models. We are also deeply experienced in qualitative, off-chain counterparty risk assessments due to our TradFi background.

  • RWAs: Another core expertise lies in real-world assets such as tokenized money market funds, private credit, and structured finance. This aligns well with Ethena’s growing allocation to RWAs and real world lending.

We also do not have any potential conflicts of interest.

Conclusion

We value the importance of this committee’s role in decentralizing Ethena’s stablecoins, the nature of the work itself, and—last but not least—the collaboration with fellow committee members. Accordingly, we are seeking re-election and look forward to your continued support.

10

Ethena Risk Committee Elections - Fourth Term
Snapshot voting link:
https://snapshot.box/#/s:ethenagovernance.eth/proposal/0x8ee7d1115c3579981a68debf6d2ec393e4a30832e0a97ed79edd8e49001d658c

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Given the importance of the fee switch for the voters, we decided to clarify our position regarding the ENA buybacks and the activation of the fee switch. We do not think that this is the right moment for Ethena to focus on this topic as it could have negative long-term effects on the protocol.
Full thesis available down below.

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