Key Takeaways:
Ethena’s ENA governance token fell as much as 9.35 percent to $0.08111, pressured by a significant token unlock that coincided with a broader cryptocurrency market downturn.
The sharp decline followed a planned token unlock on April 2, which released tokens worth $16.05 million, according to a token unlock schedule. Data from CoinGecko showed a 4.3 percent drop to $0.0858, while CoinMarketCap data from April 3 noted the steeper 9.35 percent fall, ranking ENA as a top market loser with trading volume near $155 million.
The event injected 2.18 percent of ENA's circulating supply into the market, creating significant selling pressure. Ethena operates a synthetic dollar protocol on Ethereum, with ENA used for governance. The token’s market capitalization stood at approximately $730 million after the drop.
This token-specific pressure was worsened by weakness across the digital asset space. Bitcoin (BTC) fell below $67,000 and the total crypto market capitalization declined 2.4 percent to $2.38 trillion. The Crypto Fear & Greed Index registered a score of 9, indicating “extreme fear” among investors and suggesting a period of defensive positioning.
The negative sentiment was not isolated to ENA. Major assets including Solana (SOL) and Ethereum (ETH) also posted losses of 4.8 percent and 2.59 percent, respectively. The overall Decentralized Finance (DeFi) sector, where Ethena is a key player, saw its total market capitalization fall 2.5 percent, according to industry data.
Analysts noted that while the forced buying of ETH by an exploiter of the Drift Protocol provided some temporary support for the ecosystem, the underlying trend remains cautious. For ENA, the combination of new supply from the unlock and a risk-off market environment suggests that further price pressure is possible in the near term.
This article is for informational purposes only and does not constitute investment advice.
