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Cardano’s ADA price has reached its lowest level in a year following minor reductions in decentralized finance activity on the blockchain network.
According to data from CryptoSlate, ADA is presently trading at $0.245, reflecting a 1.06% decrease on the year-to-date scale. Notably, this price point signifies the lowest level ADA has attained since the start of the year, effectively negating all the gains it had accumulated throughout the year.
What is causing ADA price difficulties?
During the early part of the year when the crypto market was on a consistent upward path, ADA’s value significantly benefited from this trend, reaching a peak of approximately $0.45 in mid-April. However, following that peak, the cryptocurrency has been on a downward trajectory, with only a slight increase observed in July.
Source: Tradingview
The digital asset encountered considerable challenges when the U.S. Securities and Exchange Commission (SEC) designated it as a security amid its actions against Coinbase and Binance.
Although Cardano’s founder, Charles Hoskinson, and Input Output Global (IOG), the parent company of the blockchain network, have strongly opposed this classification, ADA has experienced a decline in demand due to investor uncertainty regarding assets lacking clear regulatory status. This has led to the token’s value decreasing by over 15% since the classification.
Decrease in DeFi activity
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Data from DeFillama further indicates that the price drop has coincided with a reduction in DeFi activity on Cardano.
According to the data aggregator’s dashboard, Cardano’s transaction volume reached a yearly low on Sept. 9, recording merely $821,390. This represents a substantial decline from late May and early June when the network consistently processed transactions exceeding $10 million.
Source: DeFillama
However, in August and September, the average transaction volume fell to around $1.5 million, indicating a significant downturn in network activity.
Other important metrics for the network also reflect the declining network activity. For example, the blockchain’s daily users have decreased to approximately 30,000 from an average peak of over 50,000 recorded earlier this year.
Source: DeFillama
Additionally, the declining U.S. dollar value of the ADA token has caused the total value of assets locked (TVL) on the blockchain to drop to $147.89 million from its peak of $166.72 million in July.
Meanwhile, the TVL remains relatively high concerning the ADA token, although it has recently seen a slight decrease to 587 million from its peak of 621 million tokens.
The post Cardano ADA price hits year-low amid DeFi slump and SEC classification concerns appeared first on CryptoSlate.
