Cardano [ADA] has staged an impressive recovery, bouncing back from an extended period of decline that commenced amid the broader market downturn in April.
Following a renewed uptrend last week, driven by Bitcoin’s [BTC] remarkable rally, the altcoin saw a surge that resulted in a 77% increase in its weekly gains.
Over the weekend, ADA reached $0.65, marking its highest price level since April. Currently, it is trading at $0.58, showing a rise of approximately 2% over the last 24 hours according to CoinMarketCap.
But what triggered this sudden upswing?
ADA’s Upsurge and Charles Hoskinson’s Vision
The significant surge in ADA came shortly after Charles Hoskinson, the co-founder of Cardano, announced new initiatives aimed at backing and influencing U.S. cryptocurrency regulations.
In a recent video shared on X, he expressed his dedication to,
“Collaborating with policymakers in Washington DC…and individuals in the government to promote and facilitate along with other prominent figures in the field with the cryptocurrency policy.”
Cryptocurrency Regulation: Designed by Americans, for Americans
Hoskinson highlighted the potential for major political changes, highlighting that Republicans could secure control over the Senate, Presidency, and House, offering a unique opportunity for the crypto sector to achieve regulatory clarity.
The executive underscored the significance of American stakeholders, including the local cryptocurrency industry and supportive legislators, in shaping these regulations.
He also revealed intentions to inaugurate a policy office at Input-Output headquarters by January 2025 to participate in policy-making and collaborate with influencers.
The goal, as per Hoskinson, is to develop a bipartisan bill that delineates clear distinctions between securities and commodities, ensuring more operational certainty for cryptocurrency enterprises.
Executive’s Perspective
Buoyed by Hoskinson’s proactive stance, Sheldon Hunt, Head of the Cardano Ecosystem at EMURGO, voiced on X,
“The future belongs to Cardano. The future belongs to Bitcoin. The future belongs to cryptocurrency.”
These recent statements follow the return of Donald Trump to the White House. Trump, known for advocating pro-cryptocurrency policies, has committed to offering clearer regulatory frameworks for the industry.
In tandem with these strategic moves, the network witnessed a notable surge in activity. Data from Santiment revealed a 133.36% increase in daily active addresses in the past day.
The social media chatter also rose by 106.67%, indicating a growing interest and involvement in the Cardano ecosystem.
Could a Downturn Be Looming?
It’s essential to note that the recent surge secured ADA a place among the top weekly gainers. Moreover, CryptoCrypto scrutinized the daily chart, observing that since early August, it had been fluctuating between the $0.31 and $0.40 range.
Furthermore, from October onwards, the price had been below the $0.36 midpoint until the recent momentum pushed it beyond the upper boundary, testing $0.61.
Consequently, the RSI has entered the overbought region, currently at 84.74, indicating a probable correction.
Also, the 50-day EMA [blue] and 100-day EMA [yellow] have formed a golden cross, usually a bullish indicator.
In the event of a pullback, maintaining the $0.40 support level would be crucial. A breach below this point could shift the trend towards a bearish outlook, potentially leading to further declines.