08 Apr 2024 Marsha Tusk
Ethena Price Soars, Here Is Why
On April 2, 2024, Ethena (ENA) was introduced in the middle of the current cryptocurrency market meltdown, in which the price of Bitcoin closed at $65,000, or 10% less than its peak of $73,750.07, which was set just 20 days earlier. Even though the entire cryptocurrency market was in a slump, ENA was an exceptional performer, going against the general feeling of the market with its incredible price increase. With the cryptocurrency market experiencing instability, ENA's trading launch was a momentous occasion that sparked curiosity and conjecture among investors and enthusiasts alike. The price of Ethena is rising noticeably, raising the issue of what is causing the increase.
What is Ethena?
Ethena is an Ethereum-based synthetic dollar protocol that provides a cryptocurrency-based substitute for conventional banking. It comprises the "Internet Bond" savings product and the USDe synthetic dollar. With Ethereum collateral backing it, USDe is censorship-resistant, stable, and reliable. For stability, the protocol makes use of delta hedging. The "Internet Bond," which functions as a dollar savings option for customers in some jurisdictions, mixes market funding with the yield from Ethereum staking. This on-chain solution can be used for free on all DeFi systems and is transparent and scalable.
Over the last seven days, Ethena (ENA) showed notable market action with an over 88% increase, the token's current price is $1.29. With a market capitalization of $1.8, it is ranked 64th on CoinMarketCap out of the top 100 cryptocurrencies.
Source: CoinMarketCap
With about $1.089 billion in trading activity in a single day, ENA has experienced a substantial level of activity. A volume-to-market cap ratio of 229.45% indicates substantial market participation and liquidity. This makes it easier to purchase and sell cryptocurrencies on exchanges for a price that is nearly equal to their true value.
Why Ethena surged?
Ethena Labs started a deliberate airdrop, giving early adopters 750 million ENA tokens, or 5% of the total token supply. This audacious action sought to quickly boost ENA's market value while rewarding devoted supporters. As a result, Ethena accomplished a major turning point in its development and swiftly ascended to become the fifth-largest stablecoin issuer by market value.
Ethena Labs unveiled the Shard Campaign—a points-based scheme intended to reward traders with future ENA distribution in return for collateral—prior to the ENA token launch. In addition to drawing participants, this six-week campaign offered them the chance to pay out, which increased ENA's demand and value on the market.
Because ENA was available on well-known cryptocurrency exchanges like Binance, Bybit, and Kucoin, its popularity surged. By being listed on these platforms, ENA was able to expand its market reach and draw in additional traders and investors eager to capitalize on the company's potential.
Ethena Labs took a big step toward decentralization when it positioned ENA as a key element of its governance system. The project's dedication to promoting community involvement and growth in a decentralized way is evidenced by the recent distribution of 5% of ENA tokens, which is a portion of a larger allocation intended for ecosystem development.
Exchanges help Ethena with the hype
The price of Ethena (ENA) has increased significantly as a result of the recent promotion that Binance Futures introduced. For new futures traders and those who recommend them, this program offers a lucrative opportunity to earn ENA tokens. Given that there is a 700,000 ENA prize pool available, it is understandable why so many traders want to participate. In addition to earning prizes for completing their first futures trade and reaching a specific trading volume, novice futures traders can also earn ENA tokens for each successful referral who completes their first futures trade. This deal stimulates demand for ENA and encourages participation, which drives up the price of the stock.
