Despite controversy surrounding recent claims of misappropriation, Cardano is holding firm around the $0.74 support.
The token is up 1.4% in the past 24 hours, though it remains down 5.6% over the past week. With a 24-hour trading volume of $856 million, down 15% from the previous day, market activity has slowed but remains steady. Cardano (ADA) is still far from its all-time high of $3.09, set in September 2021, sitting nearly 75% lower today.
The recent developments come in the shadow of serious allegations against Cardano’s founder, Charles Hoskinson, who has come under fire after accusations emerged claiming he misused access to the Cardano network. The claims, made by NFT artist Masato Alexander on May 7, allege Hoskinson used privileged access to move about 318 million ADA, worth roughly $619 million at the time, during the 2021 Allegra hard fork.
Alexander pointed to a two-step process that involved wiping out unclaimed ADA from the 2017 initial coin offering and using a special Move Instantaneous Rewards transaction to shift funds under the control of Hoskinson or Input Output Global, the company behind Cardano.
He also questioned the transparency of these movements, pointing out that only a small amount, roughly $7 million, was formally given to the Cardano governance group Intersect. Alexander likened the incident to the 2016 Ethereum DAO hack but argued Cardano lacked the same level of community oversight.
Hoskinson has strongly denied the claims, calling them false and damaging. He stated that over 99.8% of ADA from the 2017 token sale was redeemed, and the remaining unclaimed funds, around 18 to 24 million ADA, were later donated to Intersect.
According to Hoskinson, the October 2021 transaction was part of an automated process to prevent unredeemed tokens from becoming unusable. He also promised a full audit of the treasury transactions to be released by the Cardano Foundation.
Following the backlash, Hoskinson said he was “deeply hurt” by the community’s reaction and would likely step back from social media.
Despite the controversy, technical indicators point to ADA being in a consolidation phase at the moment. At 51.7, the relative strength index indicates neutral momentum. The MACD has a negative crossover and little upward pressure, making it somewhat bearish.
Looking at moving averages, the 10-day and 20-day EMAs and SMAs are currently acting as resistance, suggesting short-term selling pressure. Longer-term support is offered by the 30-, 50-, 100-, and 200-day moving averages, which are still trending upward.
The key to stopping additional losses may lie in ADA’s ability to maintain its position above its 100-day EMA, which is at $0.73. ADA may move toward $0.78 or higher if bulls retake the 10-day EMA close to $0.76.
If current support levels are not maintained, the price may drop below $0.72 and possibly reach $0.70 or even $0.68. Both sides are currently waiting for a catalyst, so the outlook is neutral.
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