The Cardano network has seen a sharp increase in both network activity and online discussions, even as ADA has fallen to levels not seen since December 2020.
According to the latest findings by Santiment, daily active addresses and social dominance have surged for the second time this month, making Cardano one of the most discussed assets in the crypto market.
Cardano Network Activity
Data revealed that the number of active addresses on the network climbed to 29,025, as Cardano accounted for 0.33% of all cryptocurrency-related discussions. Santiment found that the rise in activity comes as ADA faces heavy price pressure and increased volatility. The increase in bearish sentiment has been linked to recent comments from Charles Hoskinson, who warned that more Cardano projects could fail.
His decision to reduce his public involvement and ongoing disagreements within the community over treasury funding have also added to concerns. Although sentiment remains weak, Santiment said that spikes in network activity combined with growing market concerns have historically preceded mild ADA rebounds.
The first occurred in late March to early April, when active addresses climbed to around 22,000, and social dominance rose above 0.40%. Another instance appeared in early June, with active addresses reaching roughly 32,500 and social dominance peaking near 0.38%. In both cases, the spikes in network activity and discussion levels were followed by a modest recovery in ADA’s price, according to the analysis.
Bull Trap For ADA?
At the time of writing, ADA is trading at $0.14 after suffering a decline of more than 3% over the past 24 hours. The crypto asset’s daily chart recently generated a TD Sequential buy signal, which may indicate a short-term price rebound. However, crypto analyst Ali Martinez warned that traders should remain cautious despite the bullish signal.
The warning comes after a security breach involving a Cardano-based wallet protocol that led to the theft of nearly 129 million ADA, worth around $20 million.
Martinez said any near-term recovery could turn into a bull trap, attracting buyers before the price resumes its decline. As such, any relief rally is likely to face resistance between $0.160 and $0.176. If ADA fails to break above this range, the price could move lower and establish new lows.
The post ADA Faces Heavy Pressure, But Cardano’s On-Chain Data Tells Another Story appeared first on CryptoPotato.
Source: https://cryptopotato.com/ada-faces-heavy-pressure-but-cardanos-on-chain-data-tells-another-story/
