Lido DAO (LDO), one of the biggest names in the decentralized finance (DeFi) space, is facing growing uncertainty after a large volume of its tokens was moved to centralized exchanges by whale investors. The timing of this move, paired with a sharp drop in both user activity and market momentum, has raised concerns that the token could be headed for a significant decline in the coming days.

In the last 48 hours, a wallet tied to DeFiance Capital transferred around 9.3 million LDO tokens—worth over $10 million—to major exchanges such as Binance, OKX, Bybit, and Gate.io. Moves like this are often considered early signs of a sell-off, especially when the overall market sentiment is already fragile. Typically, when whales send such large quantities of tokens to exchanges, it indicates they plan to cash out or reduce exposure, which often puts downward pressure on the token’s price.

Following this activity, LDO’s price plummeted by more than 10%, dropping to around $1.01. This steep decline came after the token failed to break through the key resistance level at $1.20. Market observers now warn that if LDO fails to hold above its next major support level at $0.90, it could face a deeper correction, with price targets potentially falling to $0.74 or even $0.57.

Adding to Lido DAO’s troubles is a worrying drop in user engagement. According to recent blockchain data, the number of daily active addresses on the network has fallen to just 139, while the total number of daily transactions has slipped to 72. These figures point to a significant decrease in usage, which could suggest weakening interest in the protocol among regular users.

When a crypto project sees declining participation, it often translates to lower organic demand. In other words, fewer users interacting with the platform reduces the likelihood of sustained price support. This trend becomes especially concerning when combined with whale-led selling, as both factors typically lead to negative price movements.

The bearish sentiment is further confirmed by the Price DAA Divergence, which currently sits at -6.55%. This metric compares price growth to the growth in user activity. A negative reading suggests that recent price moves were not supported by a rise in users, making the rally appear weak and potentially unsustainable. When price gains outpace user engagement, corrections are often just around the corner.

Investor behavior is also changing. Many traders appear to be stepping back from LDO. One indicator of this is the MVRV Z-Score, a metric that measures whether a token is overvalued or undervalued relative to its historical price. Right now, LDO’s score is slightly negative, around -0.133, suggesting the token is mildly undervalued. However, the lack of deeper negative scores indicates there’s no strong buying interest yet. In previous cycles, more extreme undervaluation has often led to rebounds, but that pattern is not showing up here.

Looking at the derivatives market, the picture isn’t much brighter. Trading volume has dropped by more than 24% to around $172 million, while open interest—an indicator of how many futures contracts are still active—has fallen by nearly 10%, now sitting at roughly $130 million. This decline suggests that traders are closing positions and staying away from new bets. Without active traders using leverage to push prices higher, LDO lacks the momentum needed for a recovery.

Technical indicators are equally weak. The Relative Strength Index (RSI) for LDO is hovering around 41, which indicates the asset is nearing oversold territory but hasn’t yet reached the levels that typically fuel a reversal. Until buyers step in and show renewed interest, the price could continue to slide.

Unless LDO can hold above the $0.90 support and regain upward momentum, its near-term outlook remains bearish. A further decline to $0.74 is possible if current trends continue. With whale dumping, falling user activity, and weak market signals all aligning, Lido DAO may be in for a rough ride ahead. Investors are advised to watch for key support levels and signs of a shift in sentiment before making any moves.