Cardano – Is the ‘biggest threat to Bitcoin’s dominance’ close to its bottom now?

ADA

As a seasoned analyst with years of experience under my belt, I find myself intrigued by Cardano’s recent performance. ADA, the native token of this promising blockchain platform, has been treading water near a key price level, which could be indicative of a local bottom forming. The RSI and price action support this hypothesis, with the latter showing a retest of the $0.31 range after a brief slide post-25 August.

For several months, the price of Cardano‘s ADA cryptocurrency has been on a steady decline, losing close to 60% of its value from its Year-to-Date (YTD) peak. Yet, its recent performances hint that the downward pressure might be subsiding. Could this signal a potential shift in favor of the bulls for Cardano’s market?

Currently, as I’m typing, ADA is nearly at the mark to enter the top 10 cryptocurrencies based on market capitalization. This indicates a substantial market capitalization, suggesting that numerous investors continue to hold onto this coin, anticipating its long-term growth.

It’s plausible that ADA could soon experience a new surge in value given its recent price trends. The selling pressure appears to be decreasing, and a solid base of support is emerging around the $0.31 price point. Furthermore, following a decline in its chart position after August 25th, ADA has recently revisited this same price range, hinting at potential recovery.

Cardano – Is the ‘biggest threat to Bitcoin’s dominance’ close to its bottom now?

Over the past two days, the Relative Strength Index (RSI) of this cryptocurrency has signaled a possible shift in trend within the identical price band. Notably, the selling pressure seems to have subsided.

As I analyze the current market trends, it appears there’s a potential for the price to drop further. However, intriguing on-chain indications suggest that whales are seizing the opportunity presented by the altcoin’s reduced prices.

Assessing the level of accumulation

According to IntoTheBlock’s data, it was found that ADA whales currently possess more coins than they did during the height of the 2021 bull market. For example, on September 6th, the historical distribution indicated that these large investors controlled approximately 3.2 billion ADA, which equated to about 9% of the total circulating supply.

Cardano – Is the ‘biggest threat to Bitcoin’s dominance’ close to its bottom now?

During the peak of 2021, whales collectively owned approximately 804 million ADA (2.51%). Interestingly, prior to the dramatic price surge in 2021, these large investors were actively accumulating ADA. However, as the price began to skyrocket, the balances held by these whales decreased.

Over the past several months, it appears that the number of ADA tokens held by ‘whale’ investors has increased significantly, suggesting these whales have been purchasing more during market downturns. At the previous high point, investors collectively owned approximately 8.6 billion ADA, but now they control around 7.2 billion coins.

Previously, the retail holdings peaked at approximately 23.16 billion units, but currently, they are in possession of more than 25.24 billion coins.

It seems that based on the historical “in/out of the money” metric for ADA, profits are currently at their lowest in the year 2024. This means that many ADA holders are experiencing losses given the current prices of the altcoin.

To break it down, approximately 3,730,000 addresses are currently facing difficulties, with this number having been around 1,870,000 at the beginning of 2024.

Furthermore, around 575,000 wallets or accounts had a positive balance (profit) when the information was compiled, whereas approximately 176,000 wallets or accounts were just breaking even (neither in profit nor loss).

It’s also important to mention that the creator of Cardano remains an active participant in the project. In a recent comment, he referred to Cardano as the most significant challenge to Bitcoin‘s current position of power.

2024-09-08 07:03

Assessing the level of accumulation

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