- The founder noted that Cardano would test the node with its stake pool.
- Some holders have placed ADA in self-custody, while others have been liquidated.
On March 12, Cardano’s [ADA] founder Charles Hoskinson posted on X that the project would try out the Hyperfledge Firefly. Hyperfledge Firefly is an open source node designed to scale blockchains.
However, Hoskinson did say that the test is no guarantee that Cardano would adopt the Supernode. According to him, the project would test its compatibility with the Stake Pool Operator (SPO), which is responsible for running nodes on the network.
Scaling Cardano could enable more off-chain transactions and increase user demand. But over the years the project has not been able to reach the desired height. This has also affected ADA, the original token.
ADA struggles with traction
For example, AMBCrypto has evaluated ADAs data about the chain using Santiment. As of this writing, the total number of ADA holders has dropped from 4.49 million to 4.46 million in the past 30 days.
Such a decline can be attributed to price developments. Over the past month, the price of ADA has increased by 42.39%.
Therefore, the decline in the number of holders could be because some investors had taken profits. At the same time, the decline could be due to the fact that some investors no longer trust its long-term potential.
However, should Cardano move forward with its scaling plans, more investors could be attracted to the token. But that alone may not convince market participants to join the ADA cohort.
In terms of development activity, AMBCrypto noted that the metric declined. As of December 2023, the benchmark was 96.11. However, according to press time data, the value stood at 57.11.
Source: Santiment
Hope for those who have faith in the project
On the sentiment front, the data showed that the bullish bias among market participants has diminished. At the time of writing, weighted sentiment was about to enter the negative zone.
If this happens, it would be confirmation that the perception has turned bearish. If the broader market is bearish on the Cardano token, demand could decline further, while the price could also fall.
However, another metric that suggested a good long-term picture for ADA was the Mean Coin Age (MCA). This metric indicates the relative activity between HODLers and short-term, quick-profit accounts.
Spikes in the MCA would have indicated an increase in the movement of old tokens, which could indicate a possible sell-off. However, the 90-day MCA collapsed.
Source: Santiment
This decline implies that some long-term holders are accumulating the token and withdrawing it into a cold wallet.
Read Cardanos [ADA] Price forecast 2024-2025
Now that the tokens are in-house, the opportunity to sell them may have become smaller. However, that doesn’t mean the price of ADA would increase overnight.
If holders decide to send the tokens to the exchange later, the price could fall. On the other hand, an increase in cold storage could increase the likelihood of exponential growth.