The price of Cardano (ADA) remains under pressure as the blockchain network faces major issues. With the current price of $0.30, Cardano hit a new low for the year.
From its all-time high, the cryptocurrency has fallen by more than 90%. Its market capitalization has dropped to $10.4 billion.
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No interest in Cardano NFTs and DeFi platforms
Cardano has been facing a sell-off lately as there are many challenges in the ecosystem. The success of a blockchain network like Cardano is usually determined by the activity on it. Trading volumes of NFTs, the number of DeFi transactions, and activity on metaverse platforms are the most important parameters.
A closer look at key parts of the ecosystem shows that Cardano is facing major problems. For example, according to DeFi Llama, the total value of deposits in the DeFi ecosystem has continued to decline. After peaking at $434 million earlier this year, it is now down to $76 million.
Most DeFi platforms on Cardano, including Meld, Minswap, Indigo, and WingRiders, have seen large outflows of funds. A likely reason for this is users switching to other DEXs such as GMX and Uniswap.
Meanwhile, data compiled by CryptoSlam shows that the volume of Cardano NFTs is on a downward trend. In December, just $3 million worth of non-fungible tokens were traded. This compares to over $1 million worth of Solana NFTs traded in the last 24 hours alone.
In November, trading volume in Cardano NFTs was $8 million, down from $23 million the previous month. The peak was reached in April of this year, when $62 million worth of NFTs were traded. Other metrics, including the number of unique buyers and sellers, also show deterioration.
So basically, there are signs that Cardano’s ecosystem is not growing as fast as developers expected. As a result, Cardano is having a hard time competing with rivals like Arbitrum and Ethereum.
ADA Price Forecast
The price chart shows that the ADA price has been in a steady downtrend over the past few months. In the process, the coin fell below the key support at $0.3883, which was the low on May 12. That was also the bottom of the descending triangle formation shown in black.
Cardano has also fallen below the moving average lines, while the Relative Stength Index (RSI) has risen to the neutral point at 40. As a result, I suspect that the ADA price will continue to fall in the coming days, especially if the crypto market rally slows down. The next important catalyst for the coin will be the upcoming Federal Reserve decision.
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