The Ether.fi community has introduced a proposal to allocate up to $50 million from its treasury to repurchase ETHFI tokens when they trade below $3, becoming the latest major DeFi protocol to turn to buybacks as a tool for liquidity and price support.
According to the governance proposal published Thursday, the plan authorizes the Ether.fi Foundation to execute open-market purchases of ETHFI while the spot price remains under $3.
ETHFI was down over 89% from its 2024 high and traded around $0.93 on Oct. 31, putting it within the proposed buyback range, The Block’s price page shows.
Buybacks have emerged as a preferred lever for protocols with strong fee income but subdued secondary-market demand, an approach echoing traditional corporate finance playbooks. However, Ether.fi’s strategy ties the trigger directly to a price threshold rather than fixed time intervals or budget schedules.
The plan would activate immediately upon DAO approval and continue until one of three conditions is met: the $50 million cap is reached, the foundation deems the program complete, or a subsequent governance vote alters or terminates it.
“The Foundation intends to progressively expand buy-back capacity in proportion to protocol revenues, particularly while ETHFI remains below $3, ensuring efficient use of surplus revenue to strengthen market confidence and reduce circulating supply,” the proposal states, emphasizing a link between protocol success and token holder alignment.
The four-day Snapshot vote opened Friday and, if approved, will mark the protocol’s third buyback initiative following prior liquidity-support efforts under Proposals #8 and #10. All transactions will be transparently recorded onchain and reported via the project’s Dune Analytics dashboard, the governance post added.
Ether.fi (ETHFI) is a non-custodial, Ethereum-based liquid restaking and liquid staking protocol that enables users to stake ETH and receive a tradable token. At the same time, their assets generate yield inside and outside the core staking ecosystem.
According to The Block’s data, Ether.fi currently has approximately $10 billion in total value locked, and the protocol reports annualized fees of roughly $360 million.
Big picture: $1.4 billion in DeFi buybacks so far in 2025
Ether.fi’s move follows a broader trend of decentralized finance protocols turning to buybacks as a capital-management mechanism amid rising onchain revenues. Earlier in the quarter, The Block Research reported that Uniswap and Aave drove DeFi protocol revenues back above $600 million, helping fund these new buyback cycles.
Earlier this month, Aave DAO proposed a $50 million annual token buyback program funded directly by protocol revenues, a plan designed by Aave Chan Initiative founder Marc Zeller to strengthen market depth for the DeFi lender’s native token. NFT marketplace OpenSea has also earmarked 50% of revenue for token buybacks tied to its forthcoming SEA token, expected to launch in Q1 2026. Even World Liberty Financial, the crypto initiative connected to the Trump family, has adopted a buyback-and-burn model, using protocol liquidity fees to retire its governance tokens.
According to a recent CoinGecko study, protocol token buybacks have exceeded $1.4 billion this year, led by projects such as Hyperliquid and Pump.fun, Aave, and Uniswap. The report said the momentum signals the sector’s shift toward “protocol-as-business” models that reinvest revenue to bolster tokenholder value.
© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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