On-chain data indicates that Cardano (ADA) wallet activity has lately decreased. This raises concerns about the underlying causes of this trend and its possible effects on the future of the cryptocurrency.
On-chain analytics company Santiment recently tweeted a comparison of the non-empty wallet balances of top-cap assets. One of the few networks to witness a decline in active wallets is Cardano, with non-empty wallets declining by 0.1% during the previous three months, it was noted. During that period, the non-empty wallets for Dogecoin and Bitcoin increased by 2.6% and 13.8%, respectively.
https://x.com/santimentfeed/status/1784139513956294675
The difficulties Cardano is having on the market go beyond wallet activity. According to CoinGecko statistics, the price of the cryptocurrency has dropped by 28.7% over the past 30 days, although it has increased by 17.8% over the past year. ADA’s position has declined, and it is currently ranked 10th, behind Dogecoin (DOGE) and Toncoin (TONNE).
As of this writing, ADA was showing signs of recovery following a drop to lows of $0.445 during yesterday’s trading session. At $0.4697, ADA is now up 2.2% over the past 24 hours.
Warning sign or opportunity?
The declining numbers might indicate an undervaluation opportunity or serve as a caution signifying a decline in interest in Cardano. But it is crucial to take the whole picture into account.
Uncertainty presently surrounds the whole cryptocurrency market, and variations in user behaviour are not unusual. As projects adapt to shifting market conditions, periods of decline and consolidation sometimes precede periods of renewed development and expansion.
Ongoing projects and planned Cardano improvements, which might improve network foundations, could counteract these cyclical patterns, nevertheless.
Even if ADA is currently underperforming, historical data points to the possibility of a breakout and new highs for the stock.
Crypto expert Ali said in a report from early April that Cardano is still stabilising in anticipation of a breakthrough. Cardano has so far followed the pattern shown from 2018 to 2021, and ADA may rise to $1.70 if this fractal holds, opening the door for a breakthrough to $5.
