Cardano Price Prediction As NFT Transactions Plunge
The Cardano price continued its freefall in November as contagion concerns persisted. ADA crashed to a year-to-date low of $0.2960. On Thursday, the coin traded at $0.3158, which was about 6.7% above its lowest level this year. Its market capitalization has collapsed from an all-time high of $90 billion to around $11 billion.
Cardano NFT and DeFi volumes
Cardano’s ecosystem showed some worrying data in November as a gloomy mood engulfed the cryptocurrency industry. The situation occurred after Coindesk published a report that ultimately led to the collapse of FTX and Alameda Research.
Ironically, the report also led to problems at Digital Currency Group (DCG), the conglomerate that owns it. The company has hired restructuring advisers because of the huge illiquid assets it has.
A closer look at key data in Cardano’s ecosystem shows some challenges. First, the number of ADA holders dropped to approximately 2.4 million. At its peak, the network had over 6 million holders. At the time, analysts and investors believed that Cardano would be the best alternative to Ethereum.
Meanwhile, Cardano’s DeFi ecosystem continued to see outflows. According to DeFi Llama, Cardano’s total value locked (TVL) crashed to $73 million. At its peak, the network had a TVL of over $420 million.
Learn more about how to buy Cardano.
Minswap is the largest DeFi app in Cardano with a TVL of over $28 million. It is followed by other DeFi apps such as Meld, WingRiders and SundaeSwap. A key challenge is whether Cardano’s DEX network will ever gain market share since the industry is now dominated by the likes of Uniswap, GMX and dYdX.
The Cardano price also crashed as the volume of NFTs in the ecosystem retreated. Data showed that sales of Cardano NFTs fell to $8.9 million in November from the previous month’s $23 million. It was the worst month for Cardano’s NFT since August 2021. The number of unique buyers crashed to $22,457 while sellers fell to 992.
Cardano price forecast
The ADA award has been in tight territory for the past few days as a gloomy mood engulfed the industry. It traded at $0.3158, which is along the 25-day and 50-day moving averages. Cardano has also formed a symmetrical triangle pattern shown in orange while the Relative Strength Index (RSI) has moved above the neutral point.
It is also slightly below the important resistance level of $0.3310, which was the low point in October. Therefore, the coin is likely to have a bearish breakout in December. If this happens, the most important support level to watch will be $0.25.
The only consolation for Cardano is that the Fed has indicated that it will begin raising interest rates at a slower pace in December. Such a move will be positive for Cardano and other cryptocurrencies.
