Kaspa Price Holds Demand Zone as Hashrate and Sentiment Defy 87% Decline

• Kaspa trades near a historical demand zone after an 87% decline from its all-time high, yet network metrics show structural resilience.
• Mining profitability has improved slightly with rising hashrate, while active addresses tripled in early August despite persistent price weakness.
• Bullish community sentiment reached 90.5% on CoinMarketCap, driven by strong long-term holder retention and whale accumulation patterns.
• Miners face severe pressure with daily income down 96.42% since 2024, forcing coin liquidation to cover operational costs ahead of further reward cuts.
• Technical indicators suggest a potential double bottom formation, though a breakout above $0.040 is required to confirm a sustained recovery. ",

"Kaspa (KAS) is currently navigating a challenging market environment, trading near the $0.026 mark following a precipitous 87% drop from its all-time high of $0.2075. Despite this bearish price action, underlying network fundamentals present a contrasting picture of structural strength and emerging recovery. The asset has retreated significantly from its 2024 peaks, yet it remains anchored near a historical demand zone between $0.0219 and $0.0279, a level that previously preceded substantial rallies.

The divergence between price action and network health is becoming increasingly pronounced. While traders grapple with persistent selling pressure, key on-chain metrics indicate that the network is not losing relevance. Mining activity, which had declined from over 710 PH/s in August 2025 to roughly 276.9 PH/s by late July 2026, has stabilized and rebounded to approximately 320 PH/s in early August. This recovery suggests that reduced network difficulty is successfully incentivizing miners to return, primarily those associated with major pools like Humpool, F2Pool, and ViaBTC.

User engagement has also shown surprising resilience. Daily transactions have remained stable at roughly 30,000 over the past month, while daily active addresses jumped from below 1,000 to around 3,000 in early August. This tripling of active users signals renewed participation and interest in the network, contrasting sharply with the broader market downturn. Additionally, Kaspa's recent inclusion on Google Finance has expanded its visibility to mainstream financial platforms, potentially aiding future retail discovery.

How Are Miner Economics Affecting Kaspa's Price?

The primary driver of Kaspa's recent price weakness is severe pressure on miner economics. Since August 2024, daily mining income has plummeted by 96.42%, compelling many operators to sell their earned KAS to cover operational expenses. This structural sell-side pressure creates a persistent overhang that often outweighs short-term trading sentiment.

The situation is expected to intensify in the near term. An additional 5.6% reduction in miner rewards is scheduled for 29 days from early August 2026. This upcoming block reward reduction aims to alleviate long-term inflationary pressure, but its immediate impact depends on the emergence of corresponding demand. Traders are closely watching to see if reduced issuance can outpace the liquidation pressure from unprofitable miners.

Technical analysis highlights the fragility of the current price action. The asset is testing a critical support zone between $0.025 and $0.026. A break below this level with high volume could confirm a breakdown, targeting the $0.01 support level. Conversely, recovery would require reclaiming $0.040 to shift the narrative from capitulation to accumulation. The volume-to-market-cap ratio remains low at approximately 0.606%, signaling weak buyer participation and a lack of strong buying momentum.

Is There a Bullish Case for Kaspa Despite the Decline?

Despite the technical bearishness, several indicators suggest a potential bullish setup beneath the surface. Market sentiment has diverged significantly from price action, with Kaspa recently overtaking Pi Network as the asset with the highest bullish sentiment on CoinMarketCap. The community has voted 90.5% bullish, a confidence level that persists despite the asset being near its lowest levels since early 2023.

Institutional and whale accumulation is also evident. The largest known Kaspa holder, Entity X, recently added 850,000 KAS to its position, continuing a trend of buying during the decline. Furthermore, supply age data reveals that 46.9% of circulating KAS has remained unmoved for over a year, and 63.2% has been untouched for at least six months. This low turnover indicates strong holder conviction and reduced sell-side pressure from long-term investors.

Tokenomics further support the bullish thesis. The network has 27.62 billion KAS in circulation out of a maximum supply of 28.7 billion, meaning nearly all supply is already available. This limits future dilution risks associated with large token unlocks. Ownership is relatively diversified, with 544,945 addresses holding at least 1 KAS, and the top 1,000 wallets controlling just 58.80% of the supply.

Technically, the daily chart shows a potential double bottom formation. The first bottom occurred near $0.025 in February 2026, with the second test developing around $0.026 in August. The neckline for this pattern sits between $0.040 and $0.042. A breakout above this zone could target prices between $0.060 and $0.065, following the pattern seen in the March-April 2025 double bottom. However, a failure below $0.025 would invalidate this bullish thesis and expose deeper losses.

The path of least resistance remains cautious. While short-term bounces have occurred, they lack strong volume confirmation. Investors are monitoring volume on daily closes below $0.025 as a key confirmation of further breakdown risk. A recovery narrative would require sustained buying volume to defend current levels and overcome the fundamental overhang of miner liquidation.