The Cardano price is not doing well. ADA, its native token, is trading at $1.3128, which is significantly lower than its all-time high of more than $3. It has crashed by more than 57% from its all-time high while its total market cap has crashed from more than $90 billion to about $43 billion.
ADA crash explained
Cardano is a blockchain project that was started by Charles Hoskinson, who is one of the eight co-founders of Ethereum. This fact has helped Cardano become one of the biggest cryptocurrency projects in the world even though many people don’t know what it does.
A quick look at Cardano’s website provides little information about its blockchain platform. For example, in the homepage, it describes Cardano as a “blockchain platform for changemakers, innovators, and visionaries.”
Its website also provides information about its key principles: people, purpose, technology, research, and opportunity. Most importantly, it has a roadmap page where it lists the five stages of its development, including Byron, Shelley, Goguen, Basho, and Voltaire.
We can assume that the developers have now moved to the Basho stage, which is about scaling. That’s because the recent Goguen update led to the introduction of smart contracts to its network.
Still, there are several questions that raise serious questions about Cardano. First, why did the developers take more than 5 years to introduce smart contracts? Besides, in this period, we have seen projects like Solana and Avalanche launch and scale their platforms.
Second, which projects are currently using Cardano? In my research, I only found a few projects that are built using Cardano.
Third, what is so special about Cardano that other smart contracts don’t have. For one, Cardano needs to convince developers that its platform is better than platforms like Ethereum, Solana, Binance, and Polkadot.
Therefore, in my view, I believe that Cardano is a relatively risky project to invest in from a fundamental perspective. However, technically, I can’t rule out a situation where the price stages a strong comeback as investors buy the dip.
Cardano price prediction
The daily chart shows that the ADA price has been in a major bearish trend in the past few weeks. This drop has seen Cardano shed almost $45 billion worth of value. The coin also managed to drop below the descending trendline that is shown in red.
A death cross is also approaching. This is a period where the 50-day and 200-day moving averages make a bearish crossover.
Therefore, the coin will likely keep falling as investors target the key support at $1. This view will be invalidated if the coin manages to move above $2.
Contributors
