Cardano (ADA) faces renewed selling pressure after large holders offloaded more than 110 million tokens in less than a week, raising concerns about a potential price correction.
The sell-off comes as ADA approaches a key support level, and a break below it could expose the token to further losses.
In a series of tweets Tuesday, crypto analyst Ali Martinez warned that Cardano could face a deeper correction as whale selling coincides with declining network activity. He identified $0.24 as the key level to watch, noting that a break below this support could send ADA toward $0.21.
“Cardano whales have been reducing their holdings,” Martinez wrote, citing Santiment data. “Over the past five days, large holders have offloaded more than 110 million ADA, adding selling pressure as price approaches a key support level.”
The analyst also pointed to a sharp decline in daily active addresses, which fell 41.36% from 27,248 to 15,977. The drop suggests fewer addresses interacted with the network during the period covered by his analysis, adding to concerns about weakening participation as selling pressure builds.
Interestingly, this comes even as the latest figures follow a brief increase in Cardano activity earlier this month. On October 9, Santiment reported that daily active addresses were about 27,500 on October 7 and 27,200 on October 8, roughly 1.7 times the September weekday average.
The firm linked the increase to the launch of the CIP-0113 token standard on Cardano mainnet on October 7, despite its price dropping. The subsequent decline suggests the earlier rise in participation has not yet translated into sustained growth in daily network activity.
However, the daily figures tell only part of the story. Token Terminal data cited in the supplied information placed Cardano’s monthly active addresses above 303,200, an increase of 2,000 in 24 hours. The monthly measure covers a broader period and can rise even when daily activity declines.
Moreover, Cardano’s DeFi sector showed signs of resilience. DeFiLlama data presently puts total value locked (TVL) at 272.55 million ADA, up from 263.55 million ADA on October 4, representing an increase of 9 million ADA.
Broader network participation also remains notable. Token Terminal data showed Cardano’s monthly active addresses exceeded 303,200, up 2,000 in 24 hours. While daily active addresses track activity over a single day, the monthly figure provides a wider view of network engagement.
That said, Cardano’s ongoing development could also support future adoption. Its efforts to connect Bitcoin-based assets through CIP-113 and liquidity with Cardano applications, alongside its smart contract capabilities, native assets, and Hydra scaling solution, could expand the network’s use cases, potentially boosting ADA price.
At press time, ADA was trading at $0.23, up 4.12% over the past 24 hours.