Crypto whales provoked a 30% rise in Cardano (ADA) — will the coin beat the $3 price record?

There have become more whales on the Cardano an open-source public blockchain platform network, according to a Santiment study. Because of the decline in the value of the coin, small and medium-sized investors began to buy up the token and turned into major market players.

Analysts noticed that since Dec. 30, the value of the ADA [native Cardano token] has risen 30% (from $0.24089 to $0.3129), after which more new addresses containing $1M or more in ADA appeared online. What influenced the value of the coin and what will happen to it further — we’ll discuss in the article. 

Cardano bull run: Why is the token growing? 

The value of cryptocurrency is largely determined by supply and demand. That is, if most of the volume of a particular token is withdrawn from circulation, it will lead to an increase in the price of the remaining coins in circulation. 

The rise in the value of ADA came in the first week of January 2023. Experts cite ADA whale activity as the main reason for the bullish rally. 

They found that in November and early December, the value of the coin peaked and stopped rising ($0.3188 at the end of November). In order for it to start rising again, the whales first threw their huge supplies on the market, after which there was an oversupply, from which the value of ADA fell ($0.2482 at the end of December). This affected small players who had previously purchased at a higher price. As soon as the price dropped, the whales started buying again, and with them other market players who had enough money (that’s where more whales came from). Whales purchased and began to hold the coins again; the assets are less in the market, and there is a demand, so the cost rises ($0.3251 currently).

“After dumping 568.4 million coins in the last two months of 2022, whales have now returned 217.2 million ADA,” the study says. 

After accumulation, whales often send coins into storage. There are fewer of them on the market, the demand for the token increases, and it rises in value. This is what is happening with ADA right now: Whales’ return to accumulation tactics has triggered a rebound in the token, as small and mid-sized investors have moved into the big players having thoroughly bought in at the bottom.

#Cardano has now jumped an impressive +30% since December 30th. Since the start of the rally, 28 new addresses have popped up on the network that hold 1M or more $ADA. Trading volume has hit a 2-month high, including increasing large whale transactions. https://t.co/6Zli0Q9IcI pic.twitter.com/GgEVOzXOF8

— Santiment (@santimentfeed) January 9, 2023

It seems that investors with 10K to 1M ADA in their accounts imitated investor behavior during the bear market in 2019. Back then, the value of ADA first reached $1.3 and then dropped to $0.33, did not fall below that threshold for another two months, and only then began to rise. Now we are seeing a more rapid effect.

ADA was also pushed by the overall market growth on January 9. Then Bitcoin, Ethereum, and many other altcoins jumped in value. We reported about that here. 

Cardano’s current price 

As of this writing, Cardano is trading at $0.3155 per coin, down 0,56% from 24 hours ago but up 18,97% from a week earlier. This is the highest seven-day growth rate in the top 15 by market capitalization, according to CoinMarketCap.

 

 

The asset seems to have started the year on a major note, but compared to its historical peak of September 2021, that’s not enough. ADA was $2.96 at the time. Compared to the current rate, the difference is an impressive 838%. 

Predictions 

Santiment researchers do not rule out that if the whales continue to expand their stockpile, ADA could rise in value to $3, thus breaking its record. 

There are other reasons to believe that the value of Cardano will increase. 

• The launch of DJED a crypto-backed algorithmic stablecoin that uses smart contracts to achieve price stabilization; the goal is to become the coin with which all transaction fees on the Cardano network will be paid stablecoin. COTI [a blockchain-based payments network] CEO Shahaf Bar-Geffen said at the Cardano summit that the launch of a stable blockchain-based coin will make the ADA more attractive. This is because the emergence of a digital currency backed by real collateral (dollar, oil, gold, etc.) stimulates capital inflows and increases the transactional activity of network users. The launch is scheduled for January 2023.
• A complete transition to decentralized management as part of the Voltaire update [With the latest era, network participants will be able to influence the future development of the altcoin with their shares and voting rights. Furthermore, users will have the opportunity to make suggestions for software updates and technical and financial improvements to the project]. It will include features by which community members (validators: people responsible for storing data, processing transactions, and adding blocks to the blockchain in cryptocurrencies with proof of ownership) can use their shares to influence the future development of the network. If community members become interested in the innovation and new ones join, this could affect the value of the coin.
• Charles Hoskinson’s new hospital. The establishment will accept ADAs as payment for medical services. The Hoskinson Health & Wellness Clinic website states that it is located in the state of Wyoming in the United States. There are 10 employees on staff. Primary care, mental health services, women’s health, preventative health screenings, cancer tests, diet/nutritional medicine, and cardiovascular care are just a few of the many medical options available to hospital patients.

What is Cardano? 

Cardano (initial release date: 2017) is a blockchain platform based on the Proof-of-Stake algorithm [a mechanism for processing transactions and creating new blocks in the blockchain]. It is designed to create decentralized applications based on smart contracts. 

Mathematician Charles Hoskinson and the cryptographer and Edinburgh University professor Aggelos Kiayias are considered two of the main people on the project. 

One of the main differences from other cryptocurrencies is considered to be the presence of a large research community. In 2022, the official group had 230K members. The goal of the project is to create a decentralized system and solve the problems of global financial systems. 

The native coin is ADA, which allows community members to vote and make decisions in the ecosystem. In addition, the coin can be set as a coin reward in some cryptocurrency wallets (Exodus and Daedalus). ADA can then be mined and received. For “stacking” holding funds in a special wallet to support the operation in the blockchain network this cryptocurrency, the user also receives a coin reward. 

The blockchain strategy consists of five phases. The project is now in its third phase. 

• Byron. Development of key concepts.
• Shelley. Transition to decentralized mode, adding stacking.
• Goguen. Making smart contracts so that even people without a deep knowledge of programming can create them.
• Basho. Increasing the transaction speed. At the time of writing, it’s 250 transactions per second. For example, Solana has 65K and XRP has 50K, while Ethereum has only 15–20.
• Voltaire. Full transition to decentralization.

The road to the last phase has already been traced. So we’ll soon find out if Cardano can achieve his goal. What do you think about it?