Cardano (ADA) Plunges 20.53% to $0.5648, Yet Defies the Crash With a 428.86% Volume Surge

While the price of ADA dropped significantly, its trading volume skyrocketed by an astounding 428%, signaling intense investor activity despite widespread market turmoil.

Cardano (CRYPTO: ADA) price dropped 20.53% to $0.5648 during the early hours of Friday, March 13. Despite the decline, the coin witnessed one of the highest trading volumes, surging 428.86% to 1,000,634,306,000 over 24 hours.

What Happened: ADA showed relative strength despite the broader market decline, caused by Federal Reserve officials’ commentary on inflation and geopolitical tensions between Russia and Ukraine continuing to impact the crypto market.

Large-scale investors, known as ‘whales,’ played a pivotal role in ADA’s recent price movements. Over the past 48 hours, whales sold around 330 million ADA tokens, contributing significantly to the increased trading volume.

The sell-offs exerted downward pressure on the price, particularly concerning smaller investors. However, these whales had not repurchased their holdings, indicating a cautious stance amid ongoing market uncertainty.

Typically, whales sell when the price drops and re-enter when they anticipate a rebound. The absence of buying suggests a pessimistic outlook, potentially signaling further turbulence for ADA.

DeFi Activity, Total Value Locked Declines

Cardano’s decentralized finance (DeFi) sector faced setbacks, with DeFi protocols on the network experiencing a collective decline in total value locked (TVL).

At the beginning of 2024, Cardano’s DeFi markets had a TVL of $593 million, which has since dropped to $355 million — an outflow of nearly $238 million.

This substantial decrease occurred as DeFi investors withdrew their assets amid the turbulent market conditions, showing a loss of confidence in the DeFi protocols on ADA.

While DeFi activity on ADA remained crucial, the network’s ability to maintain momentum was uncertain. A continuous decline in TVL could further dampen the prospect of ADA’s price recovery.

According to some analysts, a potential buying opportunity may arise once the market stabilizes and investors’ confidence is restored, possibly leading to a revival in ADA’s DeFi ecosystem.

Potential Recovery, Investor Outlook

Despite recent turbulence, many investors viewed this downturn as a potential buying opportunity. Historically, ADA has shown resilience during market crashes and tends to rebound strongly after periods of extreme volatility.

If ADA manages to reclaim the critical $0.99 support level, it could rally toward the $1.05 mark, some analysts said.

On the other hand, if the price breaks below $0.070, it could further slide down to $0.62, making the coming days crucial for ADA’s further movement.

The recent Plomin hard fork, which aimed to enhance the scalability and performance of Cardano, could act as a catalyst for recovery.

Supporters expressed optimism that this may improve ADA’s long-term growth prospects and could attract more investors into the ecosystem.

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