The Cardano (ADA/USD) price declined sharply as wary investors exited their cryptocurrency investments. ADA declined for the second consecutive day and fell to the lowest level since June 22. The decline brought its total market capitalisation to more than $33 billion.
Cardano price sell-off
Cardano is a leading blockchain project that was developed by one of Ethereum’s co-founders. The platform goal is to decentralize most processes in companies and institutions. For example, financial companies like banks can use the platform to decentralize the know-your-customer (KYC) and anti-money laundering (AML) processes. Similarly, schools can decentralize their certificate issuances.
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Cardano recently made news when it announced that smart contracts were coming to its platform. This is a relatively long process that is encompassed in its Goguen era of development. When completed, Cardano will become a viable alternative to Ethereum in terms of DAPP development.
The Cardano price is declining because of the overall weakness of the cryptocurrency industry. Indeed, the total market capitalization of all cryptocurrencies tracked by CoinMarketCap has declined by more than 7% in the past 24 hours. Bitcoin has declined below $30,000 while Ethereum price is hovering at a key level of support.
This decline is because of the worrying data on the Delta virus. In the past few days, the number of coronavirus cases has risen globally. Worse, according to Sky News, 60% of people who are being admitted to hospital are unvaccinated. This means that about 40% of admissions in the UK are people who have received a Covid jab. As such, there is a high probability that the number of cases will keep rising.
As a result, the Cardano price drop was part of the overall sell-off in global assets as fear rose. Indeed, the fear and greed index has declined to the lowest level since the pandemic started. Subsequently, this led to a steep sell-off in global stocks.
Cardano price prediction
Looking at the daily chart, we see that an important thing happened on Monday. The Cardano price declined below the 200-day moving average for the first time since June. This is a notable sign since it sends a signal that bears are taking over. At the same time, the coin is hovering at an important level of support where it struggled to move below several times before. Therefore, a more bearish trend will be validated if it moves below the support at $1.2262.
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