Cardano price continued its freefall as demand for ADA and other crypto tokens evaporated. ADA plunged to a low of $0.25, which was substantially lower than its all-time high of $3. As a result, Cardano investors have suffered as its total market cap plunged from over $90 billion to about $8 billion.
Cardano ecosystem challenges
Cardano, like other blockchain coins, has had a tough time as investors lose confidence in the industry. Data published by DeFi Llama shows that investors have pulled over $11 billion in assets from Binance in the past 30 days.
While most of these investors have sold their coins, others have simply moved theirs to self custody fearing that the company will implode soon. Besides, the company lost its auditor last weekend when Mazars stopped its work for cryptocurrencies.
ADA price has also dropped because of the ongoing challenges in its ecosystem. A closer look at its DeFi ecosystem shows that the total value locked has crashed from more than $400 million to about $65 million. MinSwap has the biggest market share in its industry.
Meanwhile, Cardano’s NFT volume has also dropped. According to CryptoSlam, the volume of Cardano NFTs crashed from more than $23 million in October to $8.9 million. This month, Cardano has processed just $4.9 million worth of NFTs. Therefore, if this trend continues, we will see the second consecutive month of decline. Cardano is still the fifth-biggest NFT chain having processed over $429 million on history.
Will Meld save ADA?
Cardano supporters cite Meld as a possible future catalyst for ADA. Meld is currently the second-biggest DeFi platform in Cardano with a TVL of over $12 million. It is a rival to other lending protocols like Aave, Tectonic, and Compound. Analysts believe that Meld could see increased inflows in 2023 as its popularity grows.
This week, Meld announced its partnership with Multichain, the blockchain that was formerly known as Anyswap. Multichain is a bridging solution that lets users bridge via pegged assets. As such, Meld will be able to support other chains like Ethereum and Cosmos. Meld has seen its TVL jump by 27% in the past 30 days.
Find out how to buy Cardano.
Cardano price prediction
Turning to the daily chart, we see that ADA price has been in a strong bearish trend in the past few months. The coin has crashed below the important support level of $0.3896, the lowest level on May 12. Cardano has dropped below all moving averages while the Relative Strength Index (RSI) has moved below the oversold level.
Therefore, the outlook for Cardano is still bearish. If this happens, the next key support level to watch will be at $0.20.
