Cardano News Today: Whale Sales and Founder Rumors Fuel ADA's Slide Below $0.37

Cardano (ADA) has been under intense scrutiny this week as rumors swirl that founder Charles Hoskinson may have sold a large portion of his ADA holdings at the peak of $3 in 2021 and refused to buy back at current levels near $0.36. Hoskinson has publicly denied the claims, calling them "made-up noise" and asserting that the allegations do not make them true. The price of ADA has continued to trend downward, trading below $0.37 and raising concerns among investors.

Large wallet holders have also been offloading significant amounts of ADA, adding to the bearish pressure. Whale activity has seen around 90 million tokens moved from larger wallets since last week, per Santiment data. This movement has contributed to increased selling pressure, particularly as ADA struggles to maintain support levels.

The on-chain and market sentiment indicators are also turning against ADA, with short positions rising and momentum weakening. Analysts are watching closely to see whether the current support at $0.36 can hold or if the price will break down further toward $0.27, which could lead to more aggressive selling and a prolonged bearish phase.

Why the Standoff Happened

The allegations against Hoskinson stem from a widely circulated claim that he sold his ADA at the 2021 peak and has not bought back despite the token's subsequent 88% drop in value. Hoskinson took to social media on Christmas Day to refute the accusations, emphasizing that he did not sell at the top and dismissed the rumors as baseless. His response was quick and firm, highlighting the lack of evidence supporting the claims and suggesting the narrative was being pushed by "bots."

The timing of the rumors is critical. With ADA trading near $0.36, just slightly above the key support level of $0.35, the market has been unusually sensitive to any news, including founder-related developments. The price has been range-bound for weeks, struggling to break out of a wedge pattern that indicates possible consolidation or a bearish continuation.

How Markets Reacted

ADA's price action has been bearish since late December, when it was rejected at $0.49 and has since fallen to below $0.37. The technical indicators are not in favor of a near-term recovery. The RSI on the daily chart stands at 37, suggesting bearish momentum is still strong. The MACD indicator recently showed a bearish crossover, which is another sign that the downward trend is likely to continue.

Derivatives market data adds to the bearish outlook. The long-to-short ratio for ADA has dropped below one, indicating that more traders are betting on the price falling rather than rising. This shift in sentiment reinforces the pressure on the token to break below current support levels.

Whale activity is also bearish. Over the past two months, large holders have offloaded around 120 million ADA tokens, aligning with the token's 50% price drop from its 2025 high of $0.80. This selling has been a significant contributor to the prolonged decline.

What This Means for Investors

For investors, the current price environment and the lack of strong bullish catalysts suggest a wait-and-watch approach may be prudent. ADA needs to hold above $0.35 to avoid a deeper correction and to give bulls a chance to push the price back above $0.40. Failure to do so could lead to further losses, with the next level of support at $0.30 becoming a potential target for bears.

Meanwhile, alternative investment opportunities are gaining traction. Projects like Mutuum Finance, with its presale event in Phase 6, have captured market attention, offering potential returns with a 250% appreciation since its initial phase. With a projected 410% return at launch, MUTM is seen as a viable alternative for investors looking to capitalize on early-stage DeFi projects.

Cardano's long-term roadmap remains intact, and it continues to develop its network with the recent Midnight privacy protocol launch. However, the short-term underperformance has raised questions about whether ADA can maintain its position in the top 10 cryptocurrencies, especially as Bitcoin Cash continues to show stronger fundamentals and adoption.

For now, investors in ADA are advised to monitor key levels closely and assess whether the current bearish trend shows signs of reversing. Any positive on-chain developments or strong buy-the-dump activity from large holders could provide the catalyst needed to stabilize the price.