Cardano Price Slumps 5% Amid $1.6 Billion Wider Crypto Outflows

Cardano (ADA) price has plunged 5% in the last 24 hours following a downward trend in sentiments and on-chain factors. This follows a wider market correction that saw over $1.6 billion wiped out of the ecosystem. Sharp declines have lowered trader momentum against previous bullish projections after Bitcoin (BTC) moved past $90K.

Cardano slipped the highest among the top 10 crypto assets by market cap over the past 48 hours. The community dubbed ETH killer trades at $0.86, falling 4.7%, with its market cap slightly above $30.4 billion. ADA has decreased 18% in the last seven days, extending losses after previous gains.

Despite reduced retail and institutional upward movements, the asset has held on to monthly gains picked up after the United States Presidential elections. Crypto users share conflicting opinions about the wider market’s recovery pace going into the new year.

Cardano Foundation’s X Account Hack Spiked Fears

Cardano’s downtrend heightened after the hack of the foundation’s X (formerly Twitter) account. The account was compromised on Dec 8 with the bad actors promoting a fake token as well as other false claims. A major point was the fake ADAsol token, which claimed to have ceased support for ADA.

The scam token generated $500,000 before it slumped 99%. Malicious actors also claimed to have been slammed by a lawsuit by the Securities and Exchange Commission (SEC). Users were advised not to interact with links from the page following the incident.

“The Cardano Foundation regrets to inform our community that we have been served with a lawsuit by the US Securities and Exchange Commission (SEC) on December 8, 2024. In light of this unexpected legal action, we have made the difficult decision to immediately cease all support toward the ADA token to ensure compliance with regulatory requirements,” the hackers wrote.

A Slow Ecosystem

The last 48 hours shown multiple crypto assets losing gains recorded in previous weeks. A glance at decentralized finance (DeFi) numbers also shows a similar downward trajectory. The total value locked (TVL) on Cardano plunged 21% from an all-time high of $708 million.

As platforms lost numbers, overall transactions plunged, leading to the status quo. The crypto ecosystem has seen about $1.6 billion in liquidations since the last dip. Daily trading volumes are also in the red zone, although slight institutional numbers were recorded. Cardano funds recorded $5.2 million in institutional flows last week.