Cardano (ADA), has been among the most-traded cryptocurrencies on the market. As it trades below the $1 mark, this digital asset that had a high price of $3.10 is back to its former glory. Some investors believe that this trend has continued for quite some time, and it is finally ending. On-chain metrics indicate that this is far off the truth. In fact, it is unlikely that the downtrend will end anytime soon.
The On-Chain Metrics are Bad
Cardano’s record of activities has been a positive thing. Cardano, which has a large following and is regarded as a “cult” cryptocurrency, is one of the most successful networks for traffic and activity. In terms of traffic, Cardano even rivaled or exceeded Ethereum as the largest smart contract network. But it seems this reign is coming to an end as Cardano’s network activity has slowed significantly.
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At the beginning of the month, Cardano’s real volume on a daily basis had surged as high as $750 million passing through the network in a day. The real volume suffered as the cryptocurrency’s price has declined and the investor sentiment turned negative.
ADA real volume on a decline | Source: Messari
Snoop Dogg’s NFT launch on the network had helped to bolster activity on the network but this soon died down. This has led to a steady decline in actual volume. The network’s real volume is currently at $37 million per day as of the writing.
Cardano: What Does This All Mean?
It is easy to link the price of any cryptocurrency within the space with the amount of network activity. Cardano’s decline in volume means more negative news about its value.
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ADA has seen a rise in its real volume in tandem with an increase of its price. This is because if real volume is down and there are no signs that it will pick up anytime soon, then the momentum isn’t enough to create a new recovery trend for cryptocurrency.
Source: ADAUSD on TradingView.com| Source: ADAUSD on TradingView.com
It is likely that as real volumes continue to fall, so will the price for the digital asset. This could lead to ADA testing reaching a $0.7 value in May. It has always been a bullish month, but there are still chances that ADA testing will rebound if the market goes down.
At the time this article was written, ADA trades at $0.84. The digital asset has fallen 72.52% since its high of $0.84 on September 2, 2021.
Featured image by Zipmex. Chart from TradingView.com