Cardano price continued slumping as the crypto meltdown accelerated. ADA plunged to a low of $0.25, which was significantly lower than its all-time high of $3. Its market valuation has slumped to over $8 billon, making it the 8th biggest cryptocurrency in the world.
Why is Cardano worth $8 billion?
Cardano is one of the biggest cryptocurrencies in the world. At its peak, it had a market cap of over $40 billion, making it a bigger financial asset than large companies like Zoom Video and United Airlines.
Recently, the coin’s price has plunged from $3 to about $0.25. Still, it maintains a market cap of over $8 billion, which is a lot of money. For example, well-known companies like Fastly, Moelis, and Dropbox are valued below that.
So, there are still concerns about Cardano’s valuation considering that its ecosystem is one of the weakest. In DeFi, Cardano has a total value locked of less than $60 million. In contrast, Aptos, which was launched recently, has a TVL of more than $50 million. It is much smaller than other platforms like Moonbeam, Fantom, Mixin, and DeFiChain among others.
The only bright part of Cardano is in the NFT industry, where it is the fourth-biggest chain in the industry. However, even in this sector, the volume has been in a strong bearish trend. After transacting NFTs worth $23 million in October, it handled $8.9 million in November and $6.9 million in December.
Therefore, it is hard to justify a $8 billion valuation of Cardano. This is despite the coin’s significant crash from $3 to $0.25. Besides, competition has risen in the sector, with platforms like Aptos and Kadena having better features.
Cardano price prediction
The four-hour chart shows that Cardano price has been in a strong bearish trend in the past few months. It crashed below the important support level at $0.3296, which was the lowest level in October. The coin has moved below all moving averages. The Average Directional Index (ADX) has moved higher, signaling that it has the bearish momentum.
Therefore, ADA price will likely continue falling in the near term. If this happens, it will likely move below the important support at $0.20.
