Is Cardano’s 20% hike enough? Not if Litecoin has its say and…
What caused Cardano's recent 20% price increase?
Cardano's recent 20% price increase was fueled by a combination of factors, including a rise in net positioning, a decrease in the Mean Coin Age, and a strong correlation with Litecoin's price movements. The increase in Open Interest indicated that traders were adding more liquidity to the market, while the decrease in Mean Coin Age suggested that Cardano holders were moving their tokens to non-custodial wallets, contributing to the price hike. Additionally, Cardano's strong correlation with Litecoin meant that its price was likely influenced by LTC's upward trend.
How does Mean Coin Age impact Cardano's price?
Mean Coin Age (MCA) measures the average age of all tokens on the Cardano blockchain1. When MCA increases, it indicates that holders are moving their old tokens, potentially leading to distribution and negatively affecting the price1. Conversely, when MCA decreases, holders are keeping their coins off exchanges, which can positively impact the price. Recently, a decrease in Cardano's MCA has been observed, suggesting that holders are retiring their assets into non-custodial wallets, potentially driving the price up.
What does a decrease in Cardano's 90-day MCA indicate?
A decrease in Cardano's 90-day Mean Coin Age (MCA) indicates that holders are moving their old tokens, which often leads to distribution and negatively impacts the price. However, when the coin age falls, it means that holders are choosing to keep their coins off exchanges, potentially leading to increased accumulation and interest in the asset.