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- Over 15 billion Cardano (ADA) have remained dormant in wallets for 12+ months, reflecting strong investor accumulation.
- ADA broke above the $0.94 neckline, forming an inverse head-and-shoulders pattern with targets of $1.20–$1.50.
Today’s Cardano price rally comes amid strong on-chain metrics, growing hopes of a Spot Cardano exchange-traded fund (ETF) coming in the US by the year-end. On August 12, corporate filings in Delaware showed that Grayscale Investments is looking to launch the “Grayscale Cardano Trust ETF.”
The filing may be seen as a stepping stone for a spot ADA ETF application since the asset manager frequently files informal ETF proposals with federal regulators before officially communicating with them.
The recent filing follows the U.S. Securities and Exchange Commission was processing a different application by the NYSE Arca to introduce a Cardano-based spot exchange-traded fund. Thus, market participants now estimate the probability of late August approval at about 75%.
A successful launch could give institutional portfolios and everyday traders streamlined ADA exposure without managing private keys or exchange storage. Market observers believe that Grayscale’s expansion to other products aside from Bitcoin and Ethereum showcases increasing investor appetite in other crypto investment products.
ADA Dormancy & Steady Accumulation
Data available on the blockchain analytics show that over 15 billion ADA remain stagnant in investors’ wallets over 12 months, a record high in the history of Cardano. Moreover, whales have scooped up an additional 200 million ADA, as mentioned in our previous story.
This accumulation run goes back to 2021, and there is no significant indication of such to be distributed even during the weak price activity.
The reluctance to sell seems partly connected to the current value of ADA, which is approximately 74.8% lower than a high established in September 2021 of $3.09.
In contrast, short-term holders, who sold heavily during the last cycle’s rally, are now applying minimal selling pressure despite a 150% price increase over the past year. They are now modestly expanding their stakes in ADA.
Technical Levels Under Close Watch
Today, ADA price rallied 16% and reached $0.98 as it broke above the $0.94, which analysts consider an essential neckline in a bull formation. Market strategist Ali said that this action comes as an inverse head-and-shoulders formation is evident on the daily time frame, a pattern that has historically led to steep rallies.
A continued momentum beyond this would open the gates to the next $1.20 and potentially even to $1.50.
Momentum indicators show mixed signals. The Relative Strength Index (RSI) sits at 73, showing a strong buying pressure, but has reached the overbought territory, wherein the sell trend usually starts. In the meantime, the adjusted Sharpe ratio or risk-adjusted returns of ADA are spiking towards results that marked significant rallies in the past.
Meanwhile, the SEC’s recent acceptance to allow funds structured in-kind creation and redemption of Bitcoin and Ethereum funds has also given a boost of confidence in the ADA ETF narrative. At a current 80% probability, Polymarket prediction market gives Cardano one of the top rankings among altcoins that have this high probability to secure a U.S. ETF listing in 2025.
