The value of ADA has increased from $0.1774 to $1.701 in a matter of five months, and during this period- it also reached an all-time high of $2.3. While we are still recovering from the recent crash in the third week of May, there is so much going on with ADA that is quite different and unique compared to other cryptocurrencies.
The correction that took place a few weeks back helped us understand how strong the Cardano community is, and it is proven by on-chain analysis that the adoption of ADA is only going to keep on increasing.
The distribution of Cardano is even more impressive because it has only a 1.5% whale concentration with 518 million ADA, whereas the retail and investor side comprises 98.5% with more than 30 billion ADA. The on-chain metrics also tell us that more cruisers than holders, which is not surprising, as the Cardano community started to expand only in the last 10-12 months.
While the community is getting stronger and stronger, the price of Cardano token is having a negative correlation to BTC. It may be not inversely proportional, but ADA is not going down like others when the bitcoin value drops significantly. When Cardano hit its all-time high on the 18th of May, the correlation to BTC was negative 0.44. Now, it is at 0.33, which is still low if we consider its 30-day high on May 6- it was 0.7.
Investors are also on the rise for Cardano, and it is significantly higher when compared to Bitcoin. The low activity addresses are more for ADA, and the number of investors is 124, which is a lot higher than bitcoin.
If we consider ethereum for comparison, it will be ahead of Cardano regarding ownership and investor concentration. The whales concentration is currently 15.83%, and there are six of them, whereas there is one whale in the Cardano ecosystem. This is another reason to support how strong the community is and how powerful the wider distribution of tokens can be.
The current economic climate of the crypto market puts a majority of Cardano users in profit compared to Ethereum and Bitcoin. 93% of ADA holders are in profit or at a break-even level, so only 6.5% per cent are in losses. In bitcoin, the number of holders in losses is higher- close to 20%, and it accounts for more than 7.8 million addresses.
All of this data from the on-chain helps us see how reliable the Cardano token has been in recent times and supports future trends. It is currently recovering at an incredible pace. With the volatility it has been building over the last six months, and it is safe to say that Cardano may over-extend this current trend with more spikes in volatility. The bears and bulls still have zero difference at the moment, so we can expect this to change in the coming weeks as well.
While the on-chain analysis proved the strength and resilience of the new investors in the community, we still have to stick around and observe how the company will integrate smart contracts. Once Goguen is fully operational, we might see a completely different picture for Cardano and its future. At the moment, we are riding on the high volatility and hoping it would reach its previous ATH in the coming weeks.
Born and brought up in India, Karthikeya Gutta is a crypto journalist and freelance contributor for ItsBlockchain. He covers various aspects of the industry with in-depth analysis and research. His passion towards blockchain and crypto ecosystem is mainly because he believes it can really change the world and help millions of people.
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