Santiment recently shared charts revealing a massive surge in ADA accumulation and exhaustion of sellers.
Cardano (ADA) might be trading in undervalued territories, according to metrics disclosed by the crypto behavior analytics platform Santiment. The Santiment data reveals a sharp increase in shark and whale accumulation along with a decrease in capitulation.
SanR, a prominent Santiment community member, recently highlighted the situation, citing three metrics corroborating the assertion. Notably, a growing accumulation pattern has been noticed amongst shark addresses (holding 100K to 1M ADA) and whale addresses (holding 1M to 10M ADA).
📊 Is #Cardano severely undervalued at this point? One of @santimentfeed's key community members certainly sees data making this case, such as sharks & whales (holding 100K to 10M $ADA) accumulating aggressively these past 6 weeks. Read the latest insight! https://t.co/TPskmWBsOH pic.twitter.com/HC0aEWIVns
— Santiment (@santimentfeed) December 27, 2022
This accumulation trend picked up shortly after FTX collapsed, triggering a price dump for ADA and the rest of the crypto market. Consequently, the whale address balance has increased to a 2-month high of 5.55B ADA at press time.
Moreover, sharks have been on a more aggressive accumulation campaign since the price crash. These addresses have amassed millions of ADA tokens since November 11, leading to a cumulative balance of 5.91B ADA as of press time. The network last witnessed this value in early May. The Crypto Basic has also highlighted this growing pattern, as shark addresses added $83M worth of ADA to their holdings in 7 weeks.
The sharp increase in accumulation and the sudden price dip have triggered a divergence between Cardano’s price and whale activity. According to SanR, this is a bullish indicator for the asset, as a price increase is expected to follow shortly.
Exhaustion of Sellers
Furthermore, following a significant selloff at the beginning of the FTX saga, ADA investors have begun holding their assets, indicating the exhaustion of sellers. Santiment’s Network Realized Profit/Loss shows a progressive decrease in coins selling at a loss as the price collapses further. The metric shows a current value of -1.76M, an improvement from the -6.22M value witnessed on November 7. This shows fewer investors are willing to sell.
ADA Volume Gap
Conclusively, SanR highlighted a gap in Cardano’s volume, which historical data suggest would likely be filled before long. Due to its current discount price, investors could be inclined to procure more ADA tokens. The surge in demand could contribute to ADA’s strength, leading to a price rally.
ADA currently trades at $0.2511 at press time, down 4.52% in the past 24 hours.