As the highly anticipated Chang upgrade draws nearer, the Cardano price has dipped below a crucial support level, raising concerns among investors. Despite the excitement surrounding this major network event, the market has not responded as expected, leading to uncertainty. In tandem, Cardano’s founder, Charles Hoskinson, has announced plans to launch a decentralized social media platform in Brazil, sparking speculation about ADA’s potential involvement in the project.
Chang Upgrade Creates ‘Sell-The-News’ Sentiment
In the last 24 hours, Cardano’s price has declined by 3.4%, hovering around $0.3358. Despite efforts by Hoskinson to propel the Chang hard fork forward, including significant steps like burning the last of the Cardano Genesis keys, the price remains under pressure.
Cardano critics will lose one of their main arguments with the Genesis keys losing functionality. They now have to acknowledge that #Cardano is decentralized in block production and project management. #Cardano is setting the standard for the entire industry once again.
— Cardano YOD₳ (@JaromirTesar) August 30, 2024
With the Chang hard fork just hours away, Cardano is poised to become the largest fully decentralized blockchain by market cap. However, on-chain metrics present a different picture of the market mood. Data from Santiment shows that the price-to-Daily Active Addresses (DAA) divergence has fallen to a two-month low as of September 1, indicating decreased network activity.
This decline, combined with a reduction in social dominance, suggests a waning interest in the project, even amidst positive developments related to the upgrade. Additionally, the daily on-chain transaction volume in loss ($2.49 billion) has exceeded the volume in profit ($1.98 billion), hinting that more investors are offloading their assets at a loss. This often occurs when market sentiment turns negative, prompting investors to minimize further losses.
The current scenario appears to be a classic case of ‘sell-the-news’ as the Chang hard fork approaches. Investors who may have bought at higher prices in anticipation of a price surge are now possibly selling off their positions.
Potential for Cardano Price Recovery
Despite the price decline, the network’s realized profit/loss ratio has improved over the past five days, suggesting that a significant number of ADA investors remain in profit. However, as the daily profit ratio reveals, some investors are selling at a loss to mitigate further declines.
Cardano’s social dominance has also decreased over the past few days, though the overall sentiment remains positive. This positive outlook, despite reduced social media activity, may indicate a potential price rebound in the near term.
Cardano’s price is facing challenging times, with the possibility of a 4.8% decline from current levels, and even an 8.2% drop if bearish conditions persist. However, future utility developments or a broader market recovery could drive price growth.
The Chang hard fork represents a significant milestone for the Cardano network, aimed at enhancing its functionality and further decentralizing its operations. Once the upgrade is live, Cardano is expected to solidify its position as the largest fully decentralized blockchain by market cap.
While Cardano’s social dominance has waned, the prevailing positive sentiment suggests that a price rebound could be on the horizon. This sentiment, coupled with realized profit/loss data, indicates that many ADA investors remain optimistic, potentially paving the way for a recovery in the near future.
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Disclaimer: Please note that the viewpoints and perspectives expressed by the author, as well as any individuals referenced in this article, are intended solely for informational purposes. They should not be construed as financial or investment advice. It’s important to acknowledge that investing in or trading cryptoassets carries inherent financial risks.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your research before investing in any cryptocurrency.
