Cardano Market Cap Surges 24% But the Outlook is Surprising: Why Are Thousands of Investors Leaving the Network?

While the Cardano (ADA) price reaches its highest point in the last month, the decline in the number of investors raises questions about the rally’s sustainability.

As volatility continues in the cryptocurrency markets, popular altcoin Cardano (ADA) has delivered a remarkable price performance. The project, which increased its market cap by 24 percent within the last week, has managed to satisfy its investors. However, on-chain data shows that the dynamics behind this rise may not be as optimistic as they seem and that a “divergence” is occurring.

According to data shared by Santiment Intelligence, the ADA price reached the $0.195 level, hitting its highest point since July 4. Despite this strong momentum in price, the fact that the total number of wallets on the network continues to decrease surprises market analysts. According to current chart data shared, the number of wallets with a balance on the Cardano network stands at 4.62 million.

Why is the Number of Investors Falling While the ADA Price Rises?

This situation presents a scenario known in technical analysis as “on-chain divergence” between price and user activity. Over the last two months, the total number of investors on the Cardano network has decreased by 7,070. The drop in the number of users during a period of rising prices indicates that the rally is driven by the repricing of existing supply rather than new investor inflows.

Data provider Santiment points out that this contradictory situation could pose a hidden danger to the rally’s longevity. The fact that retail investor interest remains weak proves that the price increase has not spread to a wide audience. If new user entry to the network cannot be secured, the sustainability of the current rise could be at risk, and the possibility of the price losing momentum remains on the table.