Santiment Analysis: Cardano Experiences Ongoing Volatility, While ADA Shows Signs of Potential Bottoming】

Cardano’s Pain Persists, Yet Signs Point to a Potential Bottom, Santiment Says
Analysis of on‑chain metrics and funding data suggests ADA may have reached a low‑point despite continued bearish sentiment.

By Crypto News Desk – March 24, 2026

Cardano (ADA) continues to struggle in one of the longest bear markets in the cryptocurrency sector, but a cluster of on‑chain and derivatives indicators released by analytics firm Santiment on Tuesday hints that the digital asset could be forming a floor.

A steep decline

Since its all‑time high of $3.09 in 2021, ADA has lost roughly 92 % of its value, trading around $0.26 at the time of writing. The price slide is mirrored by a sharp contraction in user activity: the average wallet that has been active on the Cardano network over the past twelve months is now realizing a 43 % loss on its invested capital. In addition, the token has slipped from being a top‑ten cryptocurrency to the 13th spot in market‑cap rankings, trailing behind WhiteBIT Coin (WBT) and just ahead of Bitcoin Cash (BCH).

Bottom‑forming metrics

Santiment highlighted two technical signals that historically accompany market bottoms:

1. Negative MVRV ratio – The market‑value‑to‑realized‑value (MVRV) metric for ADA is deep in negative territory, a condition that analysts often interpret as an “opportunity zone.” When the ratio is heavily skewed below zero, it indicates that most holders are sitting at a loss, which can attract contrarian investors looking for lower‑risk entry points.

2. Funding rate pressure – The short‑to‑long funding rate on Binance for ADA has risen to its highest level since June 2023. A pronounced short bias usually forces liquidations that can trigger short‑covering rallies, a pattern Santiment described as another classic bottom indicator.

“When average returns are markedly negative, it signals a potential turnaround. In a zero‑sum environment, the market tends to gravitate back toward a neutral MVRV over time,” the firm wrote in its commentary.

Wider alt‑coin malaise

Cardano’s woes are not isolated. Several other major projects are also entrenched in deep correction phases:

Conversely, some tokens such as Tron (TRX), Hyperliquid (HYPE) and LEO have shown relative resilience, underscoring the heterogeneous nature of the current bear market.

What the data could mean for investors

• Potential for short‑covering rally – The extreme short bias in funding rates may lead to forced liquidations, providing upward pressure on price.
• Attractive entry for long‑term holders – A deeply negative MVRV suggests that the majority of supply is held at a loss, which could entice value‑oriented investors seeking to accumulate at a discount.
• Risk remains high – Despite the bottom‑forming signals, ADA still sits far below its historical highs and overall market sentiment remains bearish. Further downside cannot be ruled out, especially if macro‑economic pressures or network‑specific developments (e.g., delays in roadmap milestones) persist.

Key takeaways

• ADA is down >90 % from its 2021 peak and has slipped to 13th in market‑cap rank.
• Active wallets are experiencing an average -43 % return, pushing the MVRV into strongly negative territory—historically a contrarian buying signal.
• Binance funding rates show the strongest short‑to‑long imbalance since mid‑2023, another classic bottom indicator.
• Broader alt‑coin market remains depressed, with many leading projects suffering 70‑90 % declines.
• While bottom‑forming metrics are present, the environment remains volatile; investors should weigh the potential upside against continued downside risk.

Santiment’s assessment suggests that ADA may have finally reached a floor, but the path to recovery will likely be gradual and contingent on both market‑wide sentiment shifts and Cardano’s own roadmap execution

Source: https://cryptopotato.com/cardano-pain-remains-high-but-ada-may-have-bottomed-santiment/