The 2022 bear market has significantly impacted the cryptocurrency space which significantly affected both individual investors and businesses operating in the space, so much so that Cardano ($ADA) recorded the second-largest drawdown in its history.
According to CryptoCompare’s latest Asset Report, the smart contract platform’s native token ended the year at around $0.25 after losing 81.2% of its value over its 12 months. The loss marked its second-largest drawdown, behind a 94.3% drop in the 2018 bear market, when ADA dropped from $0.71 to $0.04.
The drop notably also marked the third decline in yearly performance in Cardano’s history.
Cardano, CryptoCompare’s report added, has been one of the many layer-1 assets that performed poorly during the past year in comparison with the MVIS CryptoCompare Digital Assets 100 Index (MVDA), which dropped 65% in 2022.
It is important to note that bear markets are a normal part of the overall economic cycle and are not unique to the cryptocurrency market. Equities markets have briefly entered bear market territory last year, while the Nasdaq is still deep in bear market territory after falling over 30%.
Notably, Cardano started the year off with a recovery, moving to $0.31 at the time of writing. As reported, 20 new addresses holding over 1 million $ADA tokens have popped up recently, after the price of the cryptocurrency jumped more than 30% since the end of December, and as its trading volume rose to a 2-month high.
The cryptocurrency’s recovery came whale addresses recently restarted accumulating $ADA, which could be a main validator to watch for the cryptocurrency’s breakout. After dumping over 560 million $ADA over the final two months of 2022 $ADA whales have restarted accumulating this year, adding 217 million tokens to their stash so far.
According to an analysis by on-chain analytics firm Santiment Cardano may be “severely undervalued” Its analysis has shown that both shark and whale addresses (holdings between 100,000 and 10 million tokens) have been actively accumulating ADA over the past six weeks.
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