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Cardano (ADA) Under SEC Pressure: A Detailed Analysis

Cardano (ADA), a prominent cryptocurrency, has recently experienced a significant decline of 7.64% in value within a 24-hour period. This unexpected turn of events has caught Cardano owners off guard, particularly considering the otherwise positive performance of the token. However, the U.S. Securities and Exchange Commission (SEC) has played a pivotal role in these developments.

The SEC, known for its regulatory actions, has recently intensified its scrutiny of the cryptocurrency market. In its latest move, the agency has identified ADA, along with Solana (SOL), Polygon (MATIC), Binance Coin (BNB), and several other cryptocurrencies, as securities. Although the lawsuit primarily targets Binance, ADA has found itself entangled in these allegations.

Current Status of Cardano (ADA)

In response to the mentioned decline in value, ADA has demonstrated a simultaneous increase of 121% in its overall worth. Typically, transaction volume accounts for the number of tokens or coins involved in various transactions over a specific period. However, in the case of ADA, it became apparent that the surge in transactions predominantly stemmed from increased sales. Consequently, the volume surge has bolstered the downward trend of the token’s value.

Charles Hoskinson, co-founder of Cardano, expressed his views on the regulatory actions on June 5. In a tweet, Hoskinson denounced the allegations against Binance and other assets, perceiving them as a political witch-hunt. He further emphasized the need for unity within the crypto sector and criticized the SEC for behaving like an authoritarian institution. Hoskinson’s statement highlighted the perpetual struggle between freedom and authoritarianism, claiming that the industry should set aside its fragmentation and unite under a set of sensible rules and guidelines. This unity would help prevent the United States from descending into a dystopia that would make George Orwell’s novel “1984” seem like a festive occasion.

Analyzing ADA’s Price

As of the time of writing, the Moving Average Convergence Divergence (MACD) indicates that sellers have gained control over ADA’s price movement. The MACD serves as a technical indicator that measures an asset’s momentum. At present, the indicator remains negative, with the 12-day Exponential Moving Average (EMA) positioned below the 26-day EMA.

Positive MACD values generally suggest an upward momentum, while a negative MACD implies a downward trend. Based on this assessment, ADA’s price may potentially continue its descent to as low as $0.35. Furthermore, the Chaikin Money Flow (CMF) currently stands at -0.08. The CMF serves as an indicator of accumulation and distribution, with a negative value indicating more outflows than accumulations based on a 21-day closing price.

Given its association with the Binance FUD (fear, uncertainty, and doubt), ADA may continue to face the repercussions of its involvement. However, only time will reveal when the token will manage to recover from its current bearish outlook. As of now, Cardano is being traded at $0.035.

Cardano

Conclusion

Cardano (ADA) finds itself in a challenging position as a result of the SEC’s regulatory actions and its connection to the Binance controversy. Despite experiencing a sudden decline in value, ADA has also witnessed a substantial increase in overall worth due to heightened sales. The future of ADA’s price remains uncertain, with technical indicators pointing towards a potential further decrease. However, the crypto sector, including Cardano, has an opportunity to unite and establish a set of rational rules and guidelines to counterbalance the regulatory pressures and ensure a positive future for cryptocurrencies.

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