Cardano (ADA), the proof-of-stake blockchain network known for its shrewd contracts, has defied recent predictions of a drop from the top 10 cryptocurrency rankings by market capitalization.
In a surprising move, ADA became the best performing among major coins, registering a 7% escalate in the last 24 hours. This price action has sparked discussions about ADA’s potential to return to its 2021 glory days when it peaked at $3.10.
A Tale of Two Whales: Retail vs. Accumulation Taking profits
The recent price escalate can be attributed to two key factors: increased purchasing pressure and a potential upcoming “battle of the whales.”
On-chain data reveals that retail investors, the so-called “whale” masses, are aggressively accumulating ADA, particularly in the $0.48 to $0.50 range. This immense concentration of buyers could act as a support system if the price reaches this level.
However, a potential obstacle is hiding behind the bullish sentiment. Data shows that only 40% of current ADA holders turn a profit.
A price escalate to $0.49 could be particularly significant because it could push the percentage of holders suffering losses below 55%. This milestone could spark further buying pressure as more investors see an opportunity to break into profit territory.
The return of the whales? About volume and market cycle
Cardano price this growth is also driven by a significant escalate in trading volume, which Santiment says is reaching a weekly high of $461 million. This escalate in activity indicates growing interest in ADA, which could result in a further price escalate.
But will this dynamics be maintained? The answer may lie with the “original whales,” the immense investors who own a significant portion of the cryptocurrency.
Interestingly, the current distribution of ADA shows some similarities with market conditions in 2021, when the price reached $3. At the time, whales made up about 6% of the total supply. Today, that number is almost 7%, suggesting a potential comeback for these large players.
However, analysts warn that the success of the “return of the whale” narrative depends largely on the broader market cycle. If the current bull market reaches its peak, ADA’s price growth could be circumscribed, hampering its ability to reach an all-time high again.
Can ADA beat the odds?
Cardano’s recent price surge has instilled a sense of cautious optimism in the cryptocurrency community. While sturdy buying pressure from retail investors and the potential return of whales are positive signs, the yields of current bondholders and the unpredictable nature of the market cycle pose challenges.
In the coming weeks, it will be key to watch whether ADA can overcome the selling pressure at $0.49 and maintain its upward trajectory. If trading volume continues to escalate along with price and if the current bull market continues, ADA may just surprise everyone and return to the long-awaited $3 level.
Featured image from Pexels, chart from TradingView
