Cardano (ADA) is heading into another rough patch, with its price action and on-chain data suggesting that the cryptocurrency may be preparing for a deeper slide. After nearly a month of steady declines, traders are watching closely as ADA hovers dangerously near levels not seen since the start of 2024.
The token has now dropped for the fourth straight week, losing around 31% from this month’s peak and trading 63% below its yearly high. Cardano’s market cap has also been hit hard, falling from $40.8 billion in January to about $15.4 billion today—erasing more than half of its value in less than a year.
Activity on the Network Is Drying Up
Key indicators on Cardano’s network paint an equally worrying picture. The total value locked (TVL)—a crucial measure of user participation in DeFi—has been sliding for months. TVL has plunged from $904.9 million in December 2023 to just $251 million, signaling that users and capital continue to exit the ecosystem.
The decline doesn’t stop there. Revenue generated from apps on the network has collapsed, and the number of active addresses has nearly evaporated. According to DeFiLlama, weekly DeFi revenue is down 65% from October, while active addresses have fallen 92% compared to December last year. Such steep drops suggest fading demand and shrinking engagement, a combination that often pressures prices lower.
Even traders in the derivatives market are pulling back. Data from CoinGlass shows that open interest in ADA futures has fallen sharply to $710 million, down from $1.95 billion in mid-September, reflecting a major cooldown in speculative interest.
Technical Signals Point to More Pain
Chart indicators aren’t offering much relief either. ADA has fallen below a key support zone between $0.51 and $0.545, an area that previously acted as a strong base during earlier corrections. With this level now broken, downside momentum appears to be strengthening.
Adding to the bearish tone, Cardano now trades well under both the 50-day and 200-day moving averages, which recently formed a death cross—a classic technical signal that suggests a prolonged downtrend.
If selling pressure continues, ADA could revisit $0.30, a critical support level that has repeatedly acted as a safety net for bulls throughout 2024. From current prices near $0.42, this represents another potential 28% drop.
Is There Any Upside?
A bullish reversal isn’t completely off the table. If Cardano can reclaim the $0.54 level—also the 23.6% Fibonacci retracement—it could spark a short-term recovery and ease some of the bearish pressure.
For now, however, the broader trend remains pointed downward as weakening fundamentals and shaky technicals weigh heavily on the outlook.
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