With Donald Trump being elected as the next President and the Cardano Foundation recently proposing a controversial budget, significant volatility is expected in the price of the Ada (ADA) coin.
Currently, the ADA coin is trading at 0.3572 USD. It is up 7.90% from the previous day, driven by the US presidential election fever, 1.11% higher than a week ago, and 0.42% higher than a month ago.
With Trump being elected US President, it is expected that there will be a significant short-term movement in the price of Cardano.
Trump has been a relatively cryptocurrency-friendly candidate, and there are high expectations that his election and a Republican sweep of Congress will create a new cryptocurrency regulatory environment in the United States.
Cardano is one of the altcoins that has been hit hard by the SEC deeming it a security in 2023. Although the coin is still down 88% from its all-time high, it is also being noted as one of the projects most likely to surge in the short term following the US presidential election.
However, there is growing anger in the Cardano community after seeing the Cardano Foundation’s 2025 budget proposal, with concerns being raised that it could have a major impact on the price.
Nicolas Cerny, a user of the social media platform X, summarized the latest Cardano Foundation budget proposal in the Twitter thread below.
Cardano Budget Process 2025 – Masterclass Recap
For those who missed it, here are my key highlights from the masterclass session about Cardano's 2025 budget process at the Cardano Summit 🧵⤵️ pic.twitter.com/smi7cHgzEH
— Nicolas Cerny (@NicolasC3rny) October 31, 2024
The first line reveals the most important fact: the budget calls for selling approximately 300 million to 500 million ADA.
The GAIA Stake Pool, a user of X, pointed out that even if all 500 million ADA are not sold at once, it could have a negative impact on the price.
I've taken the time to review the #Cardano 2025 budget materials, and here is my take 🔥
1⃣ 300 – 500 Million $ADA is too much of an ask for any entity for the 2025 budget.
Even if this amount of ADA is not sold all at once, opening up ~500 million ADA to be sold will have… https://t.co/9taQdKJuer pic.twitter.com/KFpbu7Q9uM
— GAIA Stake Pool 🇨🇦 Make a Difference SPO & DRep (@GAIAstakepool) November 4, 2024
“This budget proposal will financially harm all ADA holders and ecosystem builders,” they added.
What’s next for Cardano’s ADA coin?
ADA has been one of the worst performing large-cap altcoins over the past two years. The ADA price has not been able to break out of the bear market in 2022, recovering only about 55% from its low in June 2023.
During this period, competing projects Solana (SOL) and Ethereum (ETH) have risen by over 1,900% and 1,800% respectively from their 2022 lows.
The above trends show a weak adoption narrative. ADA total value locked (TVL) is also very small compared to competing projects.
However, if a new bull market starts, ADA could be one of the fastest catching projects in 2025. The only potential scenario that could kill this momentum would be a massive liquidation of ADA by the Cardano Foundation.
Therefore, ADA traders need to carefully watch the project’s development going forward. However, with Trump being elected as the next US president, there is a possibility that it will quickly recover to this year’s high of around $0.80.
In summary, the long-term outlook for ADA price remains unclear, but in the short term, ADA could be one of the projects with the most rapid price recovery.
- US, UK, Russia Strictly Sanction Cryptocurrency Network That Helped Ruling Class Evade Sanctions - December 6, 2024
- Most investment decisions are driven by emotion, study says - December 6, 2024
- Binance dominates inflows in 2024 - December 6, 2024