Cardano (ADA) has lost more than 24% since the long-awaited Vasil update, as investors seem to become increasingly dissatisfied with the market's reaction.
Vasil Update - an update without a reflection in the price?
Vasil was supposed to be one of the major developments of the project, which, like previous updates e.g. the 'Mary hard fork update', was supposed to foster efficiency and network growth, and ultimately increase Cardano usage.
The most important areas of the update were to include improvements to throughput, transfer speed and the Plutus language for the development of dApps (decentralised applications), i.e. applications that can be developed on the project infrastructure.
Following the launch of the 'Vasil update' on 23 August in Europe, the price of the coin rose by more than 12% in the following weeks. However, it then began to fall. Is possible that the low volatility of the ADA price at the end of September was due to the general sideways trend across the crypto market, which was also seen in leading tokens such as Ethereum and Bitcoin.
What's next for Cardano?
Cardano price, daily candles
Source: Conotoxia MT5
Investors have been selling off the token significantly since the beginning of this week, with the token losing more than 15% on the Conotoxia MT5 platform today at 15:00 GMT+3.
Such large declines may also be driven by regularly deteriorating sentiment in other markets, with which the token appears to have been strongly correlated over the past year. According to Macroaxis data, the 3-month average correlation between Cardano and the QQQ ETF, which gives exposure to the Nasdaq Composite index, is now as high as 0.75.
The Ethereum merge that affected the performance and cost of ETH may also play a role in Cardano's performance. The blockchain of the world's second-largest token has become, thanks to infrastructure changes, a very attractive place to develop dApps, which may impact growth expectations for the ADA project.
An additional factor that may favour short-term declines in the value of the token is the relatively large run-up of the ADA, from a local low (in July this year). It has provided enough room for the downside we are now seeing. The token scored a 35% rally during this period, broken along with other coins in the second half of August.
How to find CFDs on Cardano?
CFDs allow you to open buy and sell positions, and thus invest when quotes rise as well as fall. At Conotoxia, you can choose from CFDs on more than 5,000 financial instruments, including more than 140 CFDs on cryptocurrencies. Wanting to find CFDs on Cardano, all you need to do is follow 4 simple steps:
- To access Trading Universe - a state-of-the-art center for financial, information, investment and social products and services with a single
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- Click "Platforms" in the "Invest&Forex" section.
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- On the MT5 platform, search for a CFD cryptocurrency and drag it to the chart window. Use the one-click trading option or open a new order with the right mouse button.
Rafal Tworkowski, Junior Financial Markets Analyst, Conotoxia Ltd. (Cinkciarz.pl investment service)
The above trading publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of 16 April 2014. It has been prepared for information purposes and should not form the basis for investment decisions. Neither the author of the study nor Conotoxia Ltd. accepts any responsibility for investment decisions made on the basis of the information contained in this publication. Reproduction or reproduction of this study without the written consent of Conotoxia Ltd. is prohibited.
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