Major Ethena Token Unlock Triggers 14% Price Surge and Volatility Fears

A major token unlock event is set to impact the Ethena (ENA) market, with $100 million worth of ENA tokens scheduled to be unlocked on August 5, accounting for 2.7% of the total supply [1]. This event follows a 14% price increase on August 5, driven by anticipation and a surge in market activity ahead of the unlock [2]. The timing of the unlock comes amid a broader upward trend for ENA, which saw a 140% rally in July, raising concerns over potential volatility as newly unlocked tokens enter circulation [3].

Prior to the event, Arthur Hayes, former CEO of BitMEX, sold 7.76 million ENA tokens, a move interpreted as tactical profit-taking rather than a withdrawal of long-term support [4]. Analysts highlight that such behavior from influential holders can signal short-term instability, especially when a significant portion of the supply is suddenly available for trading [5]. The market has already seen inflows of 250 million ENA tokens to exchanges, suggesting a possible wave of liquidity withdrawals and further downward pressure [6].

The Ethena ecosystem, however, remains robust with a Total Value Locked (TVL) of $9.53 billion, supported by DeFi integrations such as Aave’s use of Ethena’s synthetic dollar [7]. Despite these structural strengths, the short-term outlook is clouded by the magnitude of the unlock and the behavior of large token holders. Community discussions on platforms like Discord emphasize the need for liquidity and highlight cautious optimism about ENA’s long-term resilience [8].

Investors are advised to closely monitor both price movements and on-chain activity as the August 5 unlock approaches. Short-term volatility is expected, with the potential for a bearish reversal if large holders continue to offload their positions [9]. The market’s ability to absorb the newly unlocked supply will be a critical factor in determining the token’s stability and trajectory moving forward [10].

Source: [1] Ethena Token Unlock Event: Market Volatility and Insights (https://coinmarketcap.com/community/articles/6891b0e56bff8548314330a8/)