Ethena is trading lower as renewed concerns over liquidity risks and a major token unlock pressure investor sentiment.
At the time of writing, Ethena is priced at $0.586, marking a 2.9% decline over the past 24 hours. While the token has surged over 130% in the past month, it has fallen 5.6% in the last week. The recent pullback comes as traders weigh the implications of a substantial supply unlock and mounting risks tied to Ethena’s exposure to the Aave protocol.
Token unlock raises supply-side pressures
On August 5, 171.8 million ENA tokens—valued at approximately $100 million and representing 2.6% of the total supply—were unlocked. To date, only 41% of ENA’s total supply has been released, and this latest tranche could increase selling pressure, especially if recipients choose to offload their tokens.
Still, Ethena’s recent momentum—fueled by robust ecosystem partnerships and rising corporate interest in token-based treasury solutions—may help absorb some of the impact.
Despite the unlock, market activity remains strong. ENA’s 24-hour spot trading volume sits at $1.01 billion, down 3.9%. According to Coinglass data, derivatives volume dropped 7.6% to $3.19 billion, while open interest declined 3.6% to $1.06 billion, signaling a moderate slowdown in speculative trading.
Aave Exposure Under Increased Scrutiny from Risk Analysts
In addition to the recent token unlock, Ethena’s expanding footprint on Aave is drawing heightened attention from market analysts. In an August 2 report, risk advisory firm Chaos Labs noted that over 55% of USDe’s backing assets—worth approximately $4.7 billion—are now held on Aave.
This approach, known as rehypothecation, involves reusing the same assets to both collateralize USDe and generate yield through lending protocols. While common in traditional finance, this dual-use strategy raises concerns about systemic risk and overall stability.
Chaos Labs warned that a deleveraging event—such as mass redemptions or a loss of confidence—could trigger a liquidity crisis, impacting both Aave and Ethena. With USDe’s supply surging 75% over the past month to an all-time high of $9.3 billion, reliance on a single lending platform is increasingly viewed as a potential vulnerability.
Ethena technical analysis
ENA’s price action is currently cooling, but important support levels are still in place. At 53, the relative strength index indicates neutral momentum. Bollinger Bands indicate a decrease in volatility following the recent decline from the weekly high of $0.67.
Most moving averages continue to trend upward, reinforcing a bullish longer-term outlook. ENA is currently trading above both its 50-day and 100-day exponential moving averages, which sit at $0.414 and $0.389, respectively.
While short-term volatility persists, a drop below the $0.56–$0.58 support range could trigger a pullback toward $0.52. On the upside, if market conditions stabilize and buying resumes above $0.60, a retest of the $0.65 level—or higher—remains a possibility.
