Cardano (ADA) has been trading among the top 15 tokens in the crypto market, with limited dramatic breakouts. The token has, over the years, gained support from its dedicated long-term holders. Cardano is presently out of the top 10 tokens as a result of its recent recovery. The token broke out in July, trading around $0.80, a figure still shy of its all-time high of $1.21 from December 2021.
ADA has gained support from its holders, considering most of the long-term holders have been on an accumulation streak since 2021. Currently, a significant amount of Cardano is held in reserve wallets aged four years or more, starting a new accumulation period in the spring of 2025. Based on Alphractal data, long-term wallets are more willing to hold, while short-term buyers remain more balanced.
Cardano adopts treasury strategy
Cardano is now being held by whales who are in no rush to sell at the current price. The token has shown the same pattern visible in XRP, where its community has held on to their tokens while hoping for a big breakout. Despite the presence of whales, ADA is one of the few tokens that are widely distributed, with its top 100 users only holding 22.56% of the entire supply.
Cardano is closely being watched for its ability to provide funds to projects and even build its own BTC treasury. The project handed over the reins to the community, which recently voted on a fund distribution for network upgrades, as previously reported by Cryptopolitan. One of the main sources of storage for Cardano is the treasury, containing 1.6B ADA tokens.
The treasury may get distributed gradually in the coming months and years, with some of the supply potentially allocated to acquiring BTC. One of the few scenarios for the Cardano community is for its entire treasury to be allocated to BTC purchases. This is expected to remove Cardano from its previous path as a platform for games and Web3 projects, which never picked up with the same speed as other L1 chains.
ADA experiences reduced trading
Cardano is still fighting to complete another role after showing limited smart contract activity with just $350M in value locked and $37M in stablecoin liquidity. Meanwhile, ADA is still behind when compared to other hotter tokens. Outside the Cardano community, there has been no talk of using ADA to build a crypto treasury company.
ADA’s open interest dropped to around $631M, with a 77% dominance of long positions. The dominance of longs also means ADA may face selling pressure in the short term, causing a liquidation cascade. Short positions are under 23%, though liquidations may happen at the $0.81-$0.82 range. For now, ADA cannot hope for a short squeeze to a much higher range.
On Hyperliquid, ADA has also seen reduced activity, with only five whales taking notable positions. Three positions are long ADA with significant funding fee requirements, while short positions receive funding fees, and some are in profit. While ADA is currently stagnating, data from Alphractal shows that a rally may be in the making, especially if the altcoin bull market continues.
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