Nearly a week after plans were implemented to substantially increase the volume of tokens repurchased and allocated to stakers, a near twofold rise in the value of Ether.fi’s ETHFI token has been observed.
It was announced by Ether.fi on May 9 via X that 137 ETH (approximately $320,000) had been spent to repurchase 437,000 ETHFI tokens. Over half of that amount, around 70 ETH, was contributed from exit fees, which had been newly incorporated into the buyback fund.
Since September 2024, a share of the protocol’s revenue has been utilized by Ether.fi to repurchase ETHFI tokens and distribute them to stakers, according to founder and CEO Mike Silagadze in an email to The. He further noted that “a few million” dollars worth of ETHFI has been returned to stakers during that period.
According to price charts, ETHFI experienced a rise from $0.70 on May 9 to $1.44 by May 13, before slightly declining to $1.30—still marking an 86% overall increase.
According to Silagadze, the buyback process is relatively straightforward. A portion of the protocol’s revenue—ranging from 5% to 25% monthly—along with income from exit fees, is used to purchase ETHFI tokens from the market. These tokens are then deposited into the ETHFI staking pool, allowing them to be distributed to stakers. Approximately 137 ETH was used for this purpose last week, while around 100 ETH is being allocated this week.
According to DeFiLlama, Ether.fi has been ranked as the fourth-largest decentralized finance (DeFi) platform, with a total value locked (TVL) amounting to $7 billion.
Investors Turn Attention to Core Metrics
The decision by Ether.fi to increase buybacks was publicly praised by BitMEX co-founder Arthur Hayes, who shared his support on X, referring to the plan by stating, “$ETHFI = the Amex of #crypto.”
“It’s the season for fundamentals,” Hayes remarked. He dismissed tokens lacking clients or revenue and emphasized a preference for tangible returns, stating that value should be delivered through mechanisms like buybacks and burns.
According to Silagadze, the “fundamentals season” narrative has been gaining traction. He noted that there is growing fatigue with speculative tokens, as people are seeking assets that offer genuine utility and are directly tied to the performance of their underlying protocols, rather than meme coins bearing only a shared name. A broader shift in sentiment toward fundamentals was suggested to be underway.
Regarding the influence of Hayes’ post on the price of ETHFI, it was stated by Silagadze that individual posts seldom have a significant effect. However, he acknowledged that Hayes commands a following of nearly 700,000 users.
It was acknowledged that Arthur possesses a large audience and has been a strong supporter, which, according to the statement, likely contributed positively.
The Rise of Decentralized Banking
A non-custodial banking alternative was introduced by Ether.fi in late April, which was described as the first “defibank.”
The aim is to enable crypto users to manage their everyday financial activities without relying on conventional banking institutions. In addition to staking and liquid strategy vaults, a DeFi-native physical Visa credit card has been provided, offering 2% to 3% cashback.
The ultimate goal being pursued is the development of a new financial infrastructure that would allow individuals to receive their salaries in crypto, deposit those funds into Ether.fi, save, and spend them—covering expenses such as mortgages, car payments, and utility bills, as explained by Silagadze to The Defiant last month.
