DeFi
ADA seeks recovery as business activity increases
Cardano (ADA), the smart contract platform, has been going through a rough patch recently. While the DeFi sector as a whole saw an uptick in DEX volumes, Cardano’s total value locked (TVL) fell, raising concerns about the health of its ecosystem.
DeFi activity and the collapse of the NFT market
Despite increasing DEX volumes across the crypto landscape, Cardano’s TVL saw a significant decline from $430 million to $230 million, according to data from Artemis, a leading blockchain data provider . This suggests a lack of interest in dApps built on the Cardano network, which could hamper its long-term growth prospects.
The NFT space on Cardano has also taken a hit. Popular NFT collections have seen a dramatic drop in floor price and overall trading volume over the past month. This decline in interest in Cardano NFTs could further dampen investor confidence and negatively impact the market. ADA price.
Cardano: Technical indicators are flashing warning signs
The technical prospects of ADA is currently bearish. The price has been on a downward trend over the past few weeks, forming several lower lows and higher highs. Additionally, key technical indicators such as RSI (Relative Strength Index) and CMF (Chaikin Money Flow) indicate a decline in bullish momentum and money flow into ADA.
Beyond the immediate price and DeFi issues, other factors are raising concerns about Cardano’s future. ADA velocity, indicating the frequency of token trading, has decreased significantly, suggesting a decrease in trading activity. Additionally, the MVRV ratio, a measure of profitability for token holders, has also fallen, implying that most ADA addresses are currently underwater.
Cardano Price Prediction
Although Cardano remains a leading player in the blockchain space, recent developments highlight the challenges it faces. The combination of falling prices, decreased DeFi and NFT activity, and negative on-chain metrics suggests further downside potential in the near term.
Cardano should experience a slight increase in price, reaching $0.47 as of June 30, 2024, indicating an expected increase of almost 5%. However, it is important to consider various technical indicators and market sentiment to assess the potential movement of the asset.
Bearish crypto sentiment can be influenced by factors such as market trends, news events, or technical analysis patterns. Additionally, the Fear & Greed Index stands at 73, indicating a state of greed among market participants. This suggests that investors may be more willing to take risks or engage in speculative behavior, which could potentially impact Cardano’s price action.
It should be noted that ADA has experienced significant price fluctuations in the past. Its highest price of $3.10 was reached on September 2, 2021, marking its all-time high, while its lowest price of $0.017 was recorded on October 1, 2017, marking its all-time low. These historical prices highlight the volatility and potential for significant price swings in the Cardano market.
Featured image from ReddSparks Crypto Blog, chart from TradingView