Crypto traders are seizing the moment. On Friday, Ethereum staking tokens like Lido (LDO) and Ethena (ENA) saw a notable uptick, climbing 14% and 15%, respectively. This surge comes in the wake of a week-long downturn, a common precursor to a buying frenzy as investor sentiment shifts gears.
Staking Tokens Bounce Back
The rally in Lido and Ethena marks a return to last week’s highs, with renewed optimism sparked by a recent statement from the U.S. Securities and Exchange Commission. The SEC declared that liquid staking protocols, like those utilized by Ethereum-based platforms, are not considered securities. This clarification has been seen as a bullish indicator for the broader decentralized finance (DeFi) ecosystem, unlocking potential for institutional investors to dive into the staking pool. For a deeper dive into the regulatory implications, see our coverage of the SEC’s latest guidance.
According to CoinMarketCap data, the trading volume for ENA doubled in just 24 hours, reaching a staggering $1 billion. LDO wasn’t far behind, with volume surging by 83% to hit $256 million. This uptick in trading activity, combined with Bitcoin (BTC) and Ether (ETH) maintaining critical support levels, paints a promising picture for the altcoin sector at large.
Institutional Inflows and Market Dynamics
The SEC’s stance on liquid staking has seemingly opened the floodgates for institutional capital. Figment, a prominent player in the staking landscape, continues to dominate other protocols—a sign that larger players are stepping up their game. “Institutional inflows are becoming a key driver for this sector,” notes Alex Turner, a crypto market analyst at CryptoInsights. “The SEC’s recent clarity has removed a significant barrier to entry for these players.” This follows a pattern of institutional adoption, which we detailed in our analysis of Ethereum ETF inflows.
Yet, the path ahead isn’t entirely free of obstacles. The ether validator queue stands at a staggering 825,580 ETH, translating to $3.8 billion. This backlog suggests a bottleneck in the staking process, raising questions about potential profit-taking moves once these tokens are unstaked. If unstaked tokens flood the market, they could trigger a selling wave that might stall or even reverse the upward momentum.
Looking Forward
Ethereum’s recent resurgence, coupled with the regulatory nod, highlights a pivotal moment for staking-related projects. However, the high validator queue and potential for profit-taking loom large over the market’s future trajectory. “The real test will be how the market absorbs these unstaked tokens,” Turner adds. “This could either sustain the rally or send us back to the drawing board.”
As we edge closer to September, the crypto world waits with bated breath to see if this bullish trend can withstand external pressures and maintain its upward trajectory. For now, traders are enjoying the ride, but the question remains—how long will the enthusiasm last?
Source
This article is based on: Lido, Ethena Rally More Than 10% as Traders Snap Up Cheap Staking Tokens Amid ETH’s Surge
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
