- ADA has dropped over 22% in a month, with price struggling near $0.27 as retail sentiment weakens.
- Grayscale increased Cardano’s allocation to 20.34% in its Smart Contract Fund, signaling institutional accumulation.
- On-chain data shows MVRV and Open Interest declines, historically patterns that can appear near market bottoms.
Cardano hasn’t exactly been inspiring confidence lately. ADA is down more than 22% over the past month and is barely holding above the $0.27 level. Retail sentiment feels shaky, almost fragile. Social feeds are filled with frustration, doubt, and the usual “is it over?” commentary.
But while smaller investors appear to be stepping back, Grayscale is doing something very different. The digital asset manager has increased Cardano’s weighting in its Smart Contract Fund again, pushing it up to 20.34%. That’s not a minor tweak. It confirms ADA as the third-largest holding in the fund, behind Solana and Ethereum.
Since January 2026, ADA’s share has gradually climbed from around 18.5% to over 20%. Because the fund follows structured rebalancing rules, Grayscale has to purchase more ADA as its allocation rises. In other words, this isn’t just passive exposure. It’s deliberate accumulation during weakness.
Metrics Flash Stress, Maybe Exhaustion
On-chain indicators suggest the market is under pressure. Cardano’s 30-day MVRV ratio has dropped sharply, signaling that most holders are currently underwater. Historically, when MVRV falls below -20%, weaker hands tend to capitulate. They sell. The market thins out.
In prior cycles, that kind of washout often aligned with local bottoms. Not always immediately, but close. When weak participants exit, long-term holders typically remain, and selling pressure begins to ease.
Open Interest tells a similar story. It has declined alongside price, meaning speculative leverage is leaving the system. When both price and Open Interest drop together, it usually indicates that excess hype is being flushed out. Markets rarely bottom when leverage is high. They bottom when it’s gone.
Two Narratives Collide
Cardano is currently sitting between two very different narratives. On one side, the chart looks weak. Retail confidence is thin. Price action remains heavy.
On the other side, infrastructure development continues quietly. The network is preparing for major upgrades over the next 45 days, described by some as the most significant since the Alonzo era. Meanwhile, the Midnight privacy chain is expected to launch by the end of March, introducing selective privacy features tailored for regulated environments. Support from major players like Google and Telegram adds another layer of credibility.
So while the broader market focuses on price decline and short-term fear, institutional players appear to be positioning for long-term potential. The contrast is striking. Retail investors are reacting to red candles. Grayscale, meanwhile, is increasing exposure. Whether that divergence proves timely will depend on how quickly sentiment shifts. But historically, quiet accumulation phases rarely last forever.
