Earlier today (February 23), crypto analytics startup Santiment, which recently added various metrics for Cardano to its platform, explained how some of the most important ones could help us to predict where price of $ADA is headed.

In a post titled “Cardano Outlook – Has the Bottom Finally Hit?” that was published on Santiment’s Insights blog, crypto analyst “brianq” started by saying that $ADA has lost around 70% of its value in the 5+ months since its price hit an all-time high of $3.10 in early September.

Of the three metrics he looked at, two were related to on-chain data and one was related to derivatives data.

Whale Activity

Santiment says that “the group of addresses holding between 10,000 to 100,000 has been growing rapidly” while “the group above that holds between 100,000 to 1,000,000 ADA has dumped from 37.0% to 17.7% of the supply held in just the past three months”. It points out that “these two very opposite directions seemingly wipe each other out, and create a mostly neutral indicator.”

Whale Transaction Count

Santiment notes that “the amount of transactions equal to $100,000 or more can play a major part in indicating price turnarounds” and that “we often see massive spikes in whale transactions that mark either major tops or bottoms.” Not much seems to be going on right now, but they mention that you should see “an uptick in these transactions as some great alpha that Cardano will see a long-term turnaround.”

Funding Rate

According to Santiment, “by combining the average hourly funding of Cardano on both FTX and DYDX, we can see that traders are shorting at their highest ratio in a month.” Furthermore, they say that “the funding rate on Binance, which updates every 8 hours, also reflects a high degree of shorts.”

Usually, “these negative funding rates are a promising sign that the crowd expects prices to go lower”, which could lead to “short liquidations that can propel prices upwards”, which means “that these negative funding rates are a great sign.”


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