Token Unlock Releases and Large Holder Sell-Offs Drive Ethena's 80% Value Decline

Ethena's governance token, ENA, took a notable step into the mainstream financial sector this week by being officially listed on

(HOOD). This milestone comes as the token faces renewed downward pressure following a substantial token unlock, according to a . The token, which had climbed above $1 in September, has since plummeted by about 80%, trading near $0.31 as of Thursday, the report highlighted. The decline has been intensified by the early November release of more than 200 million ENA tokens into the market, accounting for 45.4% of the total 15 billion supply, the article stated. With the complete unlock scheduled for April 2027, experts caution that ongoing token releases may continue to weigh on ENA's price.

These unlocks, which have already distributed $60 million to core team members and early backers, have heightened both retail and institutional wariness, according to Stocktwits. On the platform, retail traders remain pessimistic about ENA, voicing doubts about its recovery prospects. At the same time, large holders have also contributed to the selling pressure. Data from Nansen shows that whale-held ENA dropped from 65.24 million to 43.06 million between October 31 and November 6, sparking panic-driven sell-offs, as reported by

.

Despite the ongoing price drop, Ethena's broader ecosystem—especially its

stablecoin—has attracted attention as a possible driver of future value. USDe, which merges liquid staking derivatives with short perpetual contracts, currently holds $8.9 billion in total value, making it the third-largest stablecoin after (USDT) and USD Coin (USDC), according to Stocktwits. Binance's recent addition of USDe and the launch of its "fee switch"—a $500 million buyback initiative—have been seen as positive developments for ENA. BitMEX co-founder Arthur Hayes, who owns over five million ENA tokens, described this move as "potentially transformative," the report noted.

However, technical signals remain bleak. Ethena's price is nearing a "death cross" on daily charts, a bearish indicator that could signal a further 37% drop, according to Crypto.news. The token has also shed 20% of its value in the past week, with its market cap falling from $3.7 billion to $2.3 billion, the report continued. Analysts attribute the weakness to a mix of token unlocks, whale sell-offs, and overall crypto market instability. Should

fall below the crucial $100,000 support level, the broader crypto market could see additional declines, pulling ENA down as well, Stocktwits warned.

Ethena's tokenomics present both opportunities and challenges. While the Robinhood listing marks a step toward greater institutional acceptance, the protocol's dependence on token unlocks for funding development and rewarding early participants has led to ongoing supply pressures, Stocktwits observed. Currently, more than 6.8 billion ENA tokens are circulating, with another 5.99 billion locked and set to be released through 2026. This phased release strategy, intended to avoid market shocks, has nonetheless kept speculative enthusiasm subdued.

Looking forward, Ethena's trajectory may depend on the performance of USDe and the impact of its buyback programs. The stablecoin's deployment across 24 blockchains and integration with leading DeFi platforms point to strong adoption prospects, according to

. Still, unless demand for ENA rises significantly, the token could continue to face downward pressure as more supply enters the market.