Cardano Under Pressure: Network Activity Declines

After significant gains in September, Cardano is once again facing challenges, having lost nearly 12% over the past week. New data suggests that the token's price may face additional pressure from sales by large holders and decreased network activity. According to crypto analyst Ali Martinez, large holders have sold over 110 million ADA in the past five days. This creates selling pressure as the token approaches a key support level at $0.24. Additionally, network activity is also declining: the number of active users per day has decreased by 41.36%, dropping from 27,248 to 15,977. The decline in activity indicates that fewer users are interacting with the Cardano network.

The main focus is on the $0.24 support level. Martinez believes that a break of this level could push ADA towards $0.21, close to the lower boundary of its ascending channel. Despite the decrease in active addresses, Cardano recently set a new transaction record for the first time in five years. During Epoch 660, the network processed 1,780,896 transactions, surpassing the previous record of 1,566,974 set in November 2021. This averages 83.83 transactions per block, a new all-time high for the network. While short-term signals present a mixed picture, another analyst, Crypto Patel, maintains a more optimistic view on ADA. He believes that Cardano still has plenty of growth potential. The analyst is now watching the $0.2887 level, which the crypto asset needs to close on the bi-weekly chart to confirm a breakout. If this occurs, ADA's rally could continue towards $0.50, $1, $2, $3, and eventually $5.

In addition to price changes, the Cardano ecosystem has seen several notable developments. Last week, the Cardano Foundation released CIP-0113–a new token standard for regulated assets. It allows issuers to set rules on who can own their tokens, as well as freeze or confiscate assets if necessary. This move could facilitate banks and fund managers in bringing assets such as bonds and equity assets onto the Cardano platform. Additionally, the Foundation's digital identity project, Veridian, became an independent Swiss company. It also tokenized its shares on Cardano and plans to develop identification tools for businesses, governments, and AI agents.