The world’s 8th largest cryptocurrency Cardano (ADA) has been on traders’ radar this year. Since the beginning of the year, the ADA price is up +45%.

The reason behind this price increase is the strong whale activity in Cardano. According to reports, whale transactions taking place on the Cardano blockchain have skyrocketed since early February.

The average whale transaction in the first half of February is about 1,700 transactions per day worth $100,000 or more. This is about five times more than the average 300 trades per day that occurred last month in January.

Courtesy: Santiment

Likewise, the accumulation of whales and sharks is on the rise since the collapse of the crypto exchange FTX. On-chain data provider Santiment reports:

Whale and shark addresses with 10,000 to 10 million ADA collected 659.53 million ADA, which equates to $235.5 million. This turnaround from Cardano’s key stakeholders is a good sign.

Courtesy: Santiment

In addition, the on-chain data provider reports that average merchant returns in Cardano have turned negative. So there is a low risk of buying Cardano (ADA) now as selling pressure is likely to be lower in the future.

Some bad signs for Cardano (ADA)

Santiment’s Mean Dollar Invested Age statistic shows that heavy investment in Cardano is sitting there without much activity i.e. dormant coins. “Six months ago, the average time coins were in an address was 267 days. That number has exploded to 407 days as circulation continues to struggle,” the report notes.

The total number of unique daily active addresses on the Cardano network is also decreasing. In November the total number of daily active addresses was 85,000 and this number has now dropped to 62,000 addresses per day.

While trading sentiment in Cardano (ADA) is a bit up at the moment, the ADA price could see an initial rally this month.

Bhushan is a FinTech enthusiast and has a good flair for understanding financial markets. His interest in economics and finance draws his attention to the new emerging Blockchain Technology and Cryptocurrency markets. He is in a continuous learning process and keeps himself motivated by sharing his acquired knowledge. In his spare time he reads thriller fiction novels and sometimes explores his culinary skills.

The content presented may contain the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication is not responsible for your personal financial loss.

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