Cardano updates annual low

The Cardano digital token ADA $0.41 Cardano -0.72% Market capitalization $15.14 billion VOL. 24 hours $43.03 million has dropped to its lowest price in the last year, around $ 0.41, becoming one of the weakest players on the crypto market during the latest sale. The drop of about 70% from the peak levels of late 2023 has sharpened the debate about the network’s relevance in the changing environment of decentralized finance (DeFi). Investors are waiting to see if the launch of the Midnight sidechain scheduled for December can restore confidence in the ecosystem and stimulate its activity.

One of the main reasons for the price drop is the disappointment with the pace of network development. Cardano has been repeatedly criticized for low user activity and low liquidity compared to its competitors. This debate intensified after the statement of CEO Nansen, who suggested that ADA could fall out of the top 20 cryptocurrencies due to minimal network usage. According to analytical platforms, the total liquidity of DeFi Cardano has decreased by 36% and amounts to about $ 186 million. For comparison, the new Monad network, launched only this week, is already approaching the $ 100 million mark.

Cardano founder Чарльз Хоскінсон" href="https://noworries.news/biography/charlz-hoskinson/" data-bio-id="10 311">Charles Hoskinson believes that the current state does not reflect the project’s potential. In a recent video message, he said that after the launch of the Midnight sidechain, which focuses on privacy, activity on the network will increase. According to him, Cardano is already cooperating with a number of leading developers and plans to attract new DeFi projects and liquidity. Hoskinson also hinted at the further development of RealFi initiatives, but so far, these developments have not affected the blockchain’s performance.

Technical analysis shows a prolonged decline with signs of seller exhaustion. The ADA chart forms a convergent «falling wedge» structure, which sometimes precedes a short-term recovery. The RSI indicator is in the oversold zone. If the price breaks through the upper boundary of the wedge, analysts expect a possible rise to $ 0.51, the resistance level of the beginning of the year. In the event of a further drop, support remains at $ 0.277, the August 2023 low.

Until Cardano demonstrates a steady increase in real network usage and liquidity, the price dynamics will remain dependent on market sentiment rather than long-term development plans. The December launch of Midnight will be the first major test for the blockchain — an indicator of whether investors and developers are ready to return to Cardano or whether the network will continue to struggle with its «dead» status in 2025.