ENA Surges 110% Driven by Whale Accumulation and High Yield

Ethena's native token, ENA, has seen a remarkable surge, increasing by 110% from its yearly lows. This significant rally has been driven by high-volume trading and substantial accumulation by large investors, commonly referred to as whales. The token's price reached a high of $0.4617, marking its sixth consecutive day of gains and pushing its market capitalization close to $3 billion. The total value locked (TVL) in the Ethena platform has also surged, reaching $6.17 billion, with the majority of these assets held in USDe, Ethena's algorithmic stablecoin, which now holds over $6 billion. The remaining funds are in Ethena Labs' USDtb, which has over $159 million in assets.

The recent boost in activity follows the USDe yield climbing above 10 percent for the first time this year. This return makes USDe one of the highest-yielding assets in the decentralized finance space. The delta-neutral strategy behind USDe is designed to maintain its $1 peg through market-neutral positions rather than asset backing. However, there is uncertainty about USDe’s availability in the United States. A new law mandates that stablecoins offered in the country be fully backed by U.S. dollars or equivalent liquid assets. Ethena’s USDe, which uses algorithmic mechanisms instead of reserve backing, does not meet this requirement.

Data from blockchain analytics platform shows a notable rise in whale activity. Large holders now control 43.6 million ENA tokens, reflecting a 14.6% increase over the past month. Meanwhile, exchange balances dropped to 7.27 billion, suggesting strong accumulation and reduced selling pressure. On the technical front, ENA broke past its May 14 swing high at $0.46151, signaling continued bullish momentum. The token is eyeing the 23.6% Fibonacci retracement level at $0.4841. A potential crossover between the 50-day and 100-day exponential moving averages may support a move toward the 50% retracement level at $0.7758.

The rising price of ENA is also attributed to the continued buying by whales. This accumulation by large investors suggests a strong bullish sentiment towards Ethena. The daily price chart of ENA shows a strong recovery over the past few days, crossing the important resistance level at $0.4615, which was the highest swing on May 14. This movement confirms that bulls are in control of the market. Ethena’s price is now targeting a move above the 23.6% retracement level at $0.4841. Its 50-day and 100-day Exponential Moving Averages are also nearing their crossover, indicating a potential continuation of the upward trend. Analysts predict that the token is likely to rise further as bulls target the 50% retracement level at $0.7758, which is approximately 70% above the current level.