ENA Price Surges as USDe Supply Reaches Record $9.5 Billion

Ethena’s USDe stablecoin has taken the spotlight this week, breaking previous records by reaching a supply of $9.5 billion. This impressive milestone places USDe as the third-largest stablecoin by supply, trailing only behind giants like USDC and USDT. Simultaneously, ENA has begun to recover, posting notable gains and sparking renewed interest in its trajectory. Thus, investors are closely examining what this surge might signal for the coming weeks.

USDe Supply Hits New Heights

Ethena’s USDe stablecoin supply has grown remarkably, increasing by 75% over the past month to reach a record $9.5 billion. This growth has pushed USDe ahead of FDUSD, making it the third-largest stablecoin currently available. This rapid expansion is not accidental but driven by a feedback mechanism built into the protocol’s structure.

When crypto markets rally, perpetual funding rates rise, enabling Ethena to benefit from higher yields and provide better returns to users. These improved yields attract fresh investment, which prompts more USDe to be issued, thereby creating a continuous cycle of supply growth. This dynamic mirrors the rallies seen in May and December 2024, highlighting how USDe’s supply is closely linked to overall market activity.

Ethena’s expanding role in decentralized finance is clear. It ranks as the sixth-largest protocol by Total Value Locked (TVL) and attracted close to $3 billion in inflows in July, a sharp increase from $47 million in June. Additionally, protocol fees rose to $36.5 million, doubling from the previous month and strengthening the ENA ecosystem.

ENA Price Shows Signs of Recovery

Since its launch in April, ENA’s price has experienced volatility along with a general decline. However, in September 2024, the token started to show signs of change by forming a long-term higher low and developing a symmetrical triangle pattern on its charts. This pattern, which features converging lower highs and higher lows, often indicates market uncertainty and suggests that a strong move might happen soon.

At present, ENA trades just below the triangle’s midpoint and shows slight bearish pressure. The token had three straight bearish weekly candles until last week, when a long lower wick appeared, signaling renewed buying interest. Momentum indicators offer a mixed view: the Relative Strength Index (RSI) moved above the neutral 50 level, and the MACD turned positive. These conflicting signals leave the weekly outlook unclear, but the daily charts provide a more optimistic perspective.

On shorter timeframes, ENA has broken above a crucial support near $0.45, which may now act as a base for a rally. The daily RSI shows a hidden bullish divergence, indicating growing momentum. Along with a recent bullish engulfing candlestick, a common sign of buying strength, these elements point toward a possible upward move. The six-hour charts support this by showing a completed corrective pattern, which often comes before price rebounds. If momentum continues, ENA might challenge resistance between $0.77 and $0.90 soon.

How Does USDe Growth Impact ENA Momentum?

It’s important to note that ENA’s price movements have historically been closely linked to the performance of USDe. As the stablecoin’s supply grows, it not only expands the protocol’s TVL but also increases revenue streams that back the token. The July inflows and doubling of protocol fees are key examples, offering stronger financial support for ENA’s valuation.

Because this connection works in cycles, when USDe issuance speeds up during bullish markets, ENA usually experiences higher market confidence and better fundamentals. This ongoing interaction between stablecoin demand and token price creates a positive effect that can enhance gains when market conditions are favorable.

Looking forward, August may become an important month for both USDe and ENA. If the current momentum continues, ENA could build on its recent progress while USDe’s supply grows further, helping Ethena solidify its status as a top DeFi protocol.

What to Expect from ENA?

Ethena’s USDe stablecoin has reached a record supply of $9.5 billion, underscoring the protocol’s expanding role in the DeFi sector and strengthening the outlook for ENA’s price recovery. The growing supply and increasing protocol fees reflect a healthy ecosystem fueled by stronger investor interest and more active market participation.

Looking forward, ENA’s price appears to be showing signs of a potential rally that closely follows USDe’s growth. Should this trend continue, both the stablecoin and the token may see further gains, establishing Ethena as an important project to watch in the near future.