Ether.fi Cash Spending Reaches $103 Million, Buyback Proposal Vote Concludes

Ether.fi's cash spending for July reached $103 million (approximately 135.4 billion KRW). The staking-focused protocol is expanding its business scope by bundling card payments, transactions, and loans into an on-chain financial account, with the structure of returning profits in Ether.fi (ETHFI) tokens becoming a key issue.

According to Paymentscan, Ether.fi's monthly spending increased from $54.3 million in January to $103 million in July. During the same period, the number of monthly active addresses rose from 21,898 to 40,040. The spending per address saw little change, moving from $2,479 to $2,505.

Most of the increase in spending is attributed to the expansion of the user base. The card spending market tracked by Paymentscan grew by 81% during the same period, and Ether.fi's market share slightly increased from 9.5% to 9.7%. Paymentscan explained that the aggregated data includes self-reported off-chain data, and some card markets were excluded from the sample.

On August 13, Ether.fi launched a new app that includes tokenized stock and metal trading, AAVE-integrated lending markets, and over 30 currencies and payment methods. The company reported that its membership exceeded 500,000, with an annual transaction execution rate reaching $2 billion (approximately 27 trillion KRW). Tokenized stock and metal trading are not available in some markets, including the U.S.

This shift in direction moves away from a structure that only explained profits through staking rewards. Users can store assets in self-custody vaults and use them as collateral to secure liquidity for cash card payments. The trading function adds cryptocurrency and tokenized asset trading, while the lending function connects to AAVE-based markets.

Earlier, it was reported that Ether.fi's new app added features for trading tokenized assets, portfolio-backed loans, and fiat currency account functionalities. The focus of that report was on the structure that allows users to trade assets, recognize collateral, and execute on-chain paths within the app, rather than the RWA products themselves.

The revenue structure has also changed. According to DefiLlama, Ether.fi's adapter estimates cash revenue at 1.38% of spending. If annual spending reaches $1 billion, the company's revenue before expenses would be $13.8 million (approximately 18.6 billion KRW).

Alea Research reported that as of August 30, Ether.fi's 30-day moving annualized revenue was $38.5 million (approximately 52 billion KRW), with cash accounting for $17.6 million (approximately 23.8 billion KRW). Although cash's annualized execution rate has nearly doubled since January 1, the total tracked revenue has decreased by 22% due to weakened staking and falling ETH prices.

A proposal submitted to AAVE governance on July 14 suggested a protocol fee distribution of 80% to Ether.fi and 20% to AAVE for the Ether.fi exclusive market. This distribution applies to protocol fees excluding the principal of loans and interest paid to lenders. If lending is linked to cash spending, card spending, swaps, staking, and loan fees will be bundled within one account.

The ETHFI buyback proposal is a mechanism to return this revenue in tokens. Alea Research reported that the Ether.fi Foundation proposed on August 30 to use the contributions from card, swap, and staking revenues for weekly ETHFI buybacks through CoW Swap. Based on July data, the example indicates a monthly buyback of $1.33 million, or an annualized $16 million (approximately 21.6 billion KRW). This figure is an example before approval and execution and is the amount before user reward distribution.

The proposal's example specifically outlined the flow of fees. If a swap of $10,000 (approximately 13.5 million KRW) incurs a 0.5% fee, a total of $50 would be generated. Of this, $20 would be retained by Labs, and the remaining $30 would be used for ETHFI buybacks. Of the buyback amount, $15 would remain in the foundation's treasury, and $15 would be allocated for user rewards.

The proposal also included provisions to allow the treasury to use up to 20 million ETHFI to cover any shortfall in rewards. The foundation can adjust the distribution of rewards and fees, as well as the speed of buybacks. However, the actual impact of this structure on token holders can only be assessed once the actual contribution amounts and reward distribution methods are confirmed.

Token prices and business metrics have not moved in the same direction. Alea Research noted that ETHFI rebounded by 45% from August 13 to August 30, reaching $0.55, but is still 21% lower compared to January 1. The reference value, based on the same price and a maximum supply of 1 billion, was calculated at $545 million (approximately 735.8 billion KRW).

The voting on the Ether.fi Foundation proposal concluded on September 3. The proposal included a quorum of 1 million ETHFI. Alea Research reported that as of August 31, voting rights were approximately 245,800 ETHFI, about 25% of the quorum.

For domestic investors, this matter aligns with the trend of combining tokenized asset trading, self-custody payments, and collateralized loans within one account. However, the buyback resources are an example before company expenses and user reward distribution, and ETHFI holders do not have a claim to equity in Labs. The next points to verify are whether the vote is valid, the actual execution method, and the scale of contributions.

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