The Cardano price is hovering near its lowest level since July this year as investors focus on the recent hawkish Federal Reserve decision and the overall weakness of the cryptocurrencies industry. ADA, the native token, is trading at $1.22, which is about 60% below the highest level this year.
Its total market capitalization to more than $39 billion. This means that investors have lost more than $51 billion since its peak market capitalization was more than $90 billion.
Why has ADA crypto price crashed?
Cardano is a smart contract platform that prides itself for being the first peer-reviewed platform. The developers’ goal was to create a platform that solves some of the biggest challenges using blockchain. Some of the industries they targeted were in education, logistics, and in manufacturing.
The biggest development in Cardano’s network was the Alonzo hard fork. This was a development that brought smart contracts to the network. Smart contracts are the technologies that help developers build projects like those in Decentralized Finance (DeFi) and non-fungible tokens (NFT).
While this was a positive move, some critics were concerned about the network for three main reasons. First, there was a concern that the developers had spent too much time building the smart contract features. Besides, some young platforms like Avalanche and Terra have achieved this scale within a short period.
Second, there are concerns about competition in the industry. Today, there are many smart contract platforms that are doing relatively well. Some of them are Avalanche, Binance Smart Chain (BSc), Polygon, and Algorand.
Third, the Cardano price has struggled because of Ethereum itself. While Ethereum has its flows, it seems like developers still believe in it. This explains why more than 80% of developers still choose a network that is relatively slow and expensive.
Cardano price prediction
The daily chart shows that the ADA price has been in a major bearish trend in the past few months. The coin’s sell-off accelerated when it moved below the key support at $1.9090, which was the lowest level in September.
Cardano has even formed a death cross. This is a pattern that happens when the 50-day and 200-day moving averages crossover.
At the same time, the coin’s Relative Strength Index (RSI) has declined. It also seems like it has formed a bearish pennant pattern.
Therefore, while the Cardano price will likely bounce back, for now, the coin will likely maintain a bearish trend as bears target the key support at $1.
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