- Cardano whales, holders of more than 1 million ADA, may be responsible for the current consolidation by liquidating or reducing their positions.
- Wallets with at least one to a maximum of 5 million ADA have fallen from 2,294 to 2,259 since the end of February.
After trading at $0.18 at the beginning of the year, the Cardano price climbed to $1.49 on February 27 (on Binance), thus clearly breaking through the former all-time high of $1.21 from January 2018. However, since then, ADA has been caught in a consolidation phase. As analyst Michaël van de Poppe recently noted, this is “very natural to have a calm period after a massive impulse move.”
Still, it begs the question of what caused the ADA price to cool. Certainly there was a lot of FOMO in February after the announcement of the “Mary” hard fork, the world’s largest blockchain project in Ethiopia, numerous other projects in Africa, rumors about cooperations with S&P500 companies, and various other projects and news. Contrary to expectations, some projects have been postponed, so momentum may have cooled.
However, it could pick up soon. For example, next week, on February 18 and 19, IOG CEO Charles Hoskinson will give a keynote at the “Blockchain Africa Conference 2021” about Cardano’s projects on the African continent. In addition, the supposed listing on Coinbase or other major exchange, which Hoskinson said was originally supposed to come as early as the end of February, is still pending.
Whales responsible for the ADA price consolidation?
A different perspective on the ADA price was recently provided by respected community member Pieter Nierop. The Dutchman is well known in the ADA community for analyzing on-chain data and presented an overview of “changes in number of wallets in size categories.” This shows that numerous “Cardano whales” have liquidated or reduced their holdings in the period from February 27 to March 12.
For example, on March 12, there were only 8 instead of 9 whales holding between 100 million and 2.5 billion ADA. There was also one fewer whale in the range between 25 and 50 million ADA. But the decline is particularly striking in the range between 1 and 5 million ADA, where the number fell by 152 – from 2,294 to 2,259 whales.
— Pieter Nierop (@nierop_pieter) March 12, 2021
But the graph is positive in terms of the number of small investors, as the number of all wallets continues to rise. As Nierop noted in another tweet on March 12, at the current rate, there could be 1.5 million ADA wallets by the end of the year.
Speed of wallet creation a bit up. With this speed we will hit over 1.5 million wallets by year end.
% of wallets delegating is on a higher level now. Staked ADA went a bit down.
Just yesterday, Nierop shared the following “Delegation Monitor” overview. According to it, the average number of delegated ADA has dropped further (to 69,249), which also indicates interest from smaller investors.
In addition, the number of new wallet created per day shows a clear peak in the last two weeks in February (11,529 and 10,080). Currently, this number is about half, which shows the decreased interest of new investors compared to February. Nevertheless, the speed of wallet creation is still 4 times higher than in January.