Cardano's On-Chain Upside: Good News and Bad News as Whale Activity Rises and Daily Active Addresses Sink

Cardano, the 8th largest asset in the cryptocurrency market, has had a tumultuous past couple of years. In 2022, the asset suffered an 82% drop, which caused even the most ardent supporters to lose faith. However, in 2023, the asset has rebounded with a 45% increase, leading some to jump back on the Cardano bandwagon.

A recent analysis by Santiment of the state of Cardano reveals a mix of good and bad signs. On the positive side, the asset has seen a major uptick in whale transactions, with an average of 1,700 transactions per day valued at $100k or more occurring since the start of February. In addition, whale and shark addresses holding 10k to 10m ADA have accumulated 659.53M ADA since the FTX collapse on November 9th.

Whale Transaction Count ≥ 100k USD (ADA) | Source: Santiment

Another positive sign is that average trader returns are currently negative, indicating a lower risk in buying in now compared to an average time in Cardano’s history.

However, there are also negative signs to consider. The heavy investments in coins on the Cardano network continue to sit without doing much moving. Six months ago, the average amount of time coins sat in an address was 267 days, but that number has now ballooned to 407 days. Additionally, the number of daily active addresses interacting on the ADA network has decreased from 85,000 addresses moving Cardano on a daily basis in November to about 62,000 addresses per day now.

Daily Active Addresses (ADA) | Source: Santiment

Overall, it seems there is more to be excited about than concerned on the Cardano front, with the surge in whale activity and negative trader sentiment toward ADA potentially signaling a price burst in the future. However, it’s important to continue monitoring the situation and ensure that Bitcoin remains propped up for Cardano to continue to flourish.