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Cardano rises 27% in 24 hours: Are ADA price predictions coming true?

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The social activity around Cardano experienced a surge on 8th December. Can it help boost ADA prices?

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  • Cardano’s social activity has seen a spike in the last 24 hours.
  • Coin’s social dominance now sits at a six-month high.

Cardano’s [ADA] social dominance has risen to a six-month high amid its double-digit price gains over the past 24 hours, data from Santiment has shown.

Source: Santiment

According to the data provider, ADA’s social dominance saw an 85%  spike between 7th and 8th December. Still in an uptrend at press time, the coin’s social dominance was 3.15%. 

When an asset’s social dominance grows this way, the coin is being talked about more online. A coin’s social activity is measured by tracking the volume of mentions on social media platforms, news articles, forums, and other online sources.

ADA’s price uptick in the last 24 hours can be attributed to the surge in demand for the altcoin during that period. AMBCrypto found that on 8th December, the daily count of addresses that completed transactions involving ADA rallied by 31%.

Data from Santiment showed that the 72,821 daily active addresses recorded that day marked a single-day high in ADA’s daily active address count since 18th November. 

But there is a catch

A close correlation exists between an asset’s social and price activity. When social discussions around an asset increase alongside its price, there is always the possibility of a sharp correction.

In situations where the price uptick is not driven by any significant ecosystem update, the hike in social dominance might be due to an increase in Fear of Missing Out (FOMO). 

Are ADA holders back in profit?

The general market rally recorded in the last month has caused ADA’s price to grow by 62%. As the alt’s price steadily grew, transactions involving the coin became increasingly profitable. 

An assessment of ADA’s transaction volume ratio in profit to loss (30-day small moving average) put the metric at 1.02 at press time. This suggested that for every transaction that returned a loss in that period, 1.02 ended in a profit.

Likewise, for the first time since April 2022, ADA’s Market Value to Realized Value (MVRV) ratio has posted a positive value. 

The MVRV ratio tracks the ratio between an asset’s current market price and the average price of every coin or token of that asset acquired. A positive MVRV ratio above one signals an asset is overvalued, and investors hold above their cost basis. 


How much are 1,10,100 ADAs worth today?


Conversely, a negative MVRV value shows that the asset in question is undervalued. This means if holders sold at the asset’s current price, they would realize losses.

At press time, ADA’s MVRV ratio was 9.09%. This meant that if coin holders sold their coin at the current price, they were guaranteed at least 9.09% profit on their investments. 

Source: Santiment

 

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Abiodun is a full-time journalist working with AMBCrypto. He is also a lawyer with over 2 years of experience. With a keen interest in blockchain technology and its limitless possibilities, Abiodun spends his time understanding the technology, building projects, and educating people about it.
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