Mega Matrix, a public holding company, has made the Ethena stablecoin ecosystem the core of its digital asset investment strategy. The company is optimistic that Ethena’s synthetic dollar can gain market share from major players like Circle as stablecoin regulations become stricter.
This move is inspired by recent legislative developments, notably the US GENIUS Act. This bill introduces federal oversight for stablecoin issuers, enforces capital and liquidity requirements, and offers a legal avenue for banks and fintech firms to issue dollar-pegged tokens under regulatory compliance.
Currently, Circle stands as the only publicly traded company benefiting directly from the expanding stablecoin market, according to Colin Butler, Mega Matrix’s executive VP and global head of markets.
Circle’s public listing in June saw its shares increase by 87%. In fiscal year 2024, the company reported $1.68 billion in revenue and reserve earnings, with $155.7 million in net income, mainly driven by returns on their USDC token reserves.
Butler believes Ethena possesses similar growth prospects, estimating it could achieve $150 million within 6 to 12 months, suggesting a 6x upside potential compared to Circle.
The growth behind Ethena is attributed to USDe, its synthetic stablecoin that yields returns through staking and hedging strategies. Unlike competitors like USDC and USDT, USDe offers holders a yield, making it a more appealing collateral option in the rapidly growing stablecoin space.
Mega Matrix has positioned its stock as the first publicly traded digital asset treasury focused entirely on Ethena’s ecosystem. It concentrates its holdings in ENA, Ethena’s governance token, providing investors with direct exposure to this emerging stablecoin platform.
This structure also offers retail investors unique access to the stablecoin market thesis, which was previously only accessible through Circle or indirect avenues like Coinbase.
Before pivoting to digital assets, Mega Matrix primarily operated within entertainment and game publishing. It began exploring blockchain opportunities in 2021 and officially transformed into a digital asset treasury by 2025.
To support its strategy, the company secured a $2 billion shelf registration, enabling flexible capital raising and gradual accumulation of Ethena’s ENA tokens.
Ethena’s Fee-Switch Mechanism
Mega Matrix highlighted Ethena’s potential fee-switch mechanism as a vital value driver. When activated, this feature will allocate a share of protocol revenues to ENA token stakers, allowing them to earn from the platform’s income.
Introduced by Wintermute Governance in November 2024, the proposal asks Ethena’s Risk Committee to define the parameters for revenue sharing, considering factors like USDe supply, average protocol income, and adoption on exchanges.
In the same month, Ethena Labs approved the proposal and articulated success metrics tied to circulating supply, revenues, and exchange listings necessary for activation.
Although these benchmarks are established, no official activation date has been announced yet by the Ethena Foundation.
Market observers note that Ethena’s performance already surpasses several thresholds: circulating market cap exceeds $13 billion, making USDe the third-largest stablecoin globally, and protocol revenues are nearing qualifying levels, signaling readiness for fee-switch activation.
