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Cardano (ADA) leaves 67 percent of investors out in the cold

 


The altcoin Cardano ( ADA ) is slipping further and further in the direction of the psychologically important 1 US dollar mark, which is why a large number of investors are now confronted with impending unrealized losses.


Cryptocurrency ADA has had a bad week as Cardano has fallen 11.4% since Monday. Worse still, ADA is now down a whopping 64.7% from its record high set on Sept. 2 of $3.09. In addition, there is now a risk of a fall below USD 1 if Cardano’s rapid downward trend continues.


This development is also quite concerning for investors, as according to IntoTheBlock 's "In/Out of the Money Indicator" 67% of investors would have made losses on their investment in the altcoin as of today. Only a quarter should be happy about profits, while 9% at least reach the break-even point.


To calculate these metrics, the indicator compares the average price of all Cardano investments to the current ADA price, which is currently $1.09.


According to this, 3.41 million Cardano wallets are in the red area, only 1.25 million wallets would be in the green area.

A related metric is the length of time the cryptocurrency is held by investors. The majority (76%) of ADA investors have owned the token for between 1 and 12 months, with only 11% of crypto investors having owned it for more than a year. Interestingly, it is the latter who are now not affected by the impending losses. In this case, too, long-term holding seems to be paying off, while short-term investments are penalized.


From a technical price analysis perspective, ADA is currently clearly in a downtrend and could fall back to the year-to-date low of $0.80, which was already reached in mid-March. This slump would inevitably send even more investors into the red.


The background behind the rapid fall in value of the popular cryptocurrency is likely that the long-awaited introduction of smart contracts on the blockchain network has not met the high expectations of the community. When it comes to decentralized apps (DApps), Cardano is still a real desert, because as DefiLlama shows , there are only ten DeFi projects on the network, which only have a total value (Total Value Locked) of EUR 233 million .US dollars are coming.


Nevertheless, Cardano founder Charles Hoskinson remains convinced that many new DApps will take off on the platform after the Vasil hard fork in June. In the next phases , the focus will be on scalability and the further development of smart contracts, with hopes being pinned on a new technology called Hydra.


However, many of ADA's other fundamentals remain strong. For example, network demand hit a new all-time high earlier this year when the much-hyped Decentralized Crypto Exchange ( DEX ) SundaeSwap launched.


According to Santiment crypto market researchers, Cardano was also the most developed project in 2021. Cardano NFT bonds were also presented this week , giving investors yet another investment vehicle.


However, if ADA does not get the curve as soon as possible, the Cardano price will fall even further and drag all the more investors down with it.

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