Cardano (ADA), one of the prominent cryptocurrencies in the market, is currently facing challenges as on-chain metrics reveal a concerning trend. With almost 90% of Cardano addresses in the red, a significant decline in transaction volume, and a decrease in the number of active addresses and large investors, the ecosystem is experiencing a period of uncertainty. In this article, we delve into the key on-chain metrics and shed light on the current state of Cardano.
Cardano Addresses in the Red:
The data indicates that nearly 90% of Cardano addresses are currently in the red. Only a mere 7.11% of addresses could sell their holdings at a profit at the current market price, while approximately 3.1% could sell without experiencing any profit or loss. This represents a considerable increase compared to the previous figure of 80% loss-making addresses, indicating a growing number of holders facing losses.
Declining Transaction Volume:
Cardano’s transaction volume has experienced a sharp decline after a previous surge. This decline raises concerns about the level of activity and demand within the Cardano ecosystem. Addressing the reasons behind this decrease in transaction volume is crucial for understanding the current market sentiment.
Decrease in Large Investors:
The number of large investors in Cardano has been steadily decreasing, with two addresses exiting the market in recent weeks. Currently, around 22.35% of ADA supply is held by 140 major investors, with 9.4% concentrated among three whales. The remaining 68% is distributed among small investors. This trend suggests a potential shift in the investment landscape, as large investors reduce their exposure to Cardano.
Dwindling Number of Active Addresses:
In a startling revelation, the number of daily active addresses has experienced a 100% decline in the past seven days. This significant drop, according to data from IntoTheBlock, affects both new addresses and those without ADA coins. Such a drastic decrease raises questions about the engagement and participation of users within the Cardano network.
Continuous Increase in Total ADA Addresses:
Despite the challenging circumstances, the total number of Cardano addresses continues to rise steadily. In the last 30 days, an average of approximately 4.4 million Cardano addresses held ADA balances. This growth could indicate an influx of new participants into the Cardano ecosystem, potentially offsetting the declining engagement witnessed in other areas.
Telegram Sentiment and User Trend:
The sentiment on Telegram towards Cardano has recently shown a shift towards negativity. Over the past seven days, there were 199 positive messages compared to 138 negative messages. Additionally, the number of users or members in the Cardano Telegram group has been decreasing for several weeks, indicating a potential decline in community engagement.
As Cardano faces a series of challenges, the on-chain metrics provide valuable insights into the current state of the network. The majority of Cardano addresses find themselves in the red, with transaction volume and the number of active addresses experiencing significant declines. The departure of large investors adds to the concerns, while the growth in total ADA addresses presents a glimmer of hope. It remains to be seen how Cardano will navigate these challenges and whether the ecosystem can regain momentum in the near future.