The cryptocurrency market has experienced significant selling pressure over the past week, with Cardano’s price among the hardest hit of major digital assets. Data from CoinGecko indicates that the altcoin has shed over 30% of its value in the last seven days. However, one crypto founder suggests that panic-selling Cardano during this period of capitulation may not be the most prudent strategy.
Potential Accumulation Zone Identified for ADA
In a post on the social media platform X on June 5th, Joao Wedson, founder and CEO of Alphractal, outlined key price levels to monitor should the worst-case scenario materialize for Cardano. The on-chain data expert identified $0.1097 and $0.03478 as critical thresholds if the current price correction persists.
Wedson explained that these levels represent Cardano’s “Thermo Price” and “Delta Price,” respectively. The Thermo Price, described as a more stable metric, is calculated by dividing the blockchain’s historical revenue (in USD) by its current circulating supply. Wedson characterized this on-chain valuation metric as the “price per coin,” reflecting the accumulated historical cost or revenue generated from issuance and validator fees throughout the blockchain’s existence. He elaborated, “It is an on-chain valuation metric, similar to a historical cost of production or network security diluted by circulating supply.”
The Delta Price, on the other hand, measures the difference between the Realized Price and the Thermo Price. This metric aims to connect investors’ average cost basis with the mining or production costs of validators, offering insights into potential deep-cycle bottoms and long-term accumulation regions.
Wedson noted that Cardano’s price has only reached the Delta Price on two occasions and has never touched the Thermo Price. “I am not saying the price will necessarily visit these levels, but these are regions that need to be monitored closely, since the values change frequently, especially the Delta Price,” he clarified.
The Alphractal CEO further suggested that the $0.05 to $0.10 range could present a compelling accumulation zone for ADA, particularly if additional bearish pressure emerges. Nevertheless, Wedson also posited that if the cryptocurrency’s price stabilizes, investors might consider waiting a few months to acquire Cardano at higher levels, with greater confidence, after a retest.
Cardano Price Overview
As of this report, ADA is trading around $0.1568, marking a 16% decrease in the past 24 hours.
Leave a Reply