Bitrabo Editorial
An indicator for Cardano (ADA) recently reached an all-time high, showcasing strong confidence in the cryptocurrency amid its lackluster performance. This, alongside other positive metrics, suggests a potential rally ahead for Cardano.
Record ADA Holdings by Long-Term Investors
IntoTheBlock reported that the percentage of ADA tokens held by long-term investors hit a peak, with nearly 40% of the token’s supply in this category. These long-term investors are individuals who have held ADA for more than a year.
This shows significant confidence among these holders, despite Cardano’s performance this market cycle. Cardano ranks as the worst-performing asset among the top ten cryptocurrencies by market cap this year, with a year-to-date loss exceeding 43%.
The fact that long-term holders are increasing their ADA holdings suggests their optimism in the token’s future potential. Notably, many of these holders are likely in the red, as only 18% of ADA addresses are currently profitable, out of 3.2 million long-term holder addresses.
Cardano Activity and Network Metrics
ADA’s network activity remains robust, with stable transaction counts and an active user base since April, dispelling claims that the Cardano network lacks engagement. The community remains dedicated to the ecosystem.
IntoTheBlock also pointed out that Cardano’s on-chain volume reaches approximately $7.2 billion daily, surpassing many other networks. With a low Network Value / Daily Transaction Volume (NVT) ratio of about 2.62, ADA may be undervalued at its current price.
Challenges in Adoption for Cardano
Despite positive metrics, Cardano faces challenges in attracting new users and adoption. Compared to previous growth cycles, the network has struggled to grow its user base, with the total number of addresses holding a balance stagnating at around 4.45 million for more than a year.
Attention has shifted towards networks like Solana and Ethereum layer-2 network Base, and attracting new users to the Cardano ecosystem is crucial for potential price increases. New users could bring fresh capital into ADA, driving rallies and exploring new price territories.
At present, Cardano is trading around $0.33, with a slight decrease of over 1% in the last 24 hours, according to CoinMarketCap.