ADA Plunges 18% as Whale Activity Dwindles, Sparking Market Concerns

Cardano's ADA token has witnessed a significant 18% decline in price over the past week, coinciding with a reduction in whale activity. This development has raised concerns about the cryptocurrency's future and market stability. According to a recent report from COINOTAG, the dwindling number of whale addresses reflects a worrying trend, as large investors hold sway over market stability.

ADA's recent price decline extends its downtrend that has persisted since early February. The daily chart illustrates a lack of strong support levels, characterized by lower highs and lower lows, reinforcing the ongoing bearish sentiment within the market. The Relative Strength Index (RSI) currently rests at 36.37, just above the oversold territory, indicating weak buying pressure and leaving the door ajar for a possible short-term bounce. However, the On-Balance Volume (OBV) has continued to decline, indicating sustained selling pressure and lack of accumulation. ADA briefly fell below the critical threshold of $0.65 but made a slight recovery, showcasing some defensive buying. Nevertheless, the absence of stronger demand suggests any potential rebound may be fleeting.

Beyond technical indicators, external circumstances have also aggravated ADA's decline. A significant breach involving $1.5 billion at Bybit in February 2025 has unsettled investor confidence, initiating a wider market sell-off that could have contributed to ADA's losses. Furthermore, the noticeable decrease in whale activity has added to the instability, as these dominant players heavily influence price volatility. On the regulatory side, the SEC's acknowledgment of a Cardano ETF proposal has ushered in an air of uncertainty, which may ignite short-term volatility.

Data from Santiment reveals that the number of whale addresses holding between 1 million and 10 million ADA has diminished to 2,454, the lowest figure since January 9th. This shift suggests that large stakeholders are either liquidating their holdings or showing reluctance to accumulate, reflecting a diminishing confidence in ADA's near-term prospects. Whale movements serve as a pivotal indicator of market sentiment, and their decline may render ADA more vulnerable to additional downward pressure.

The reduction in whale addresses could signify a pivotal change with far-reaching impacts for Cardano. Diminished participation from these sizable investors might lead to lowered liquidity, making ADA susceptible to erratic price movements.