What is the reason behind the increase in Cardano ADA price today

Cardano (ADA) experienced a strong start to the week, with a 2% increase in the last 24 hours, bringing its trading price to $0.3725 on July 8. This rise in price has allowed ADA to recover from the losses it suffered on July 7, as investor sentiment towards the layer-1 token shifted positively.
ADA’s rise is significant considering the bearish trend that is currently affecting the broader cryptocurrency market. Bitcoin (BTC) and Ether (ETH), the top two cryptocurrencies by market capitalization, have both experienced drops of approximately 1.89% and 0.79% respectively.
There are several factors that have contributed to ADA’s bullish movement today. One of them is the update provided by Cardano founder Charles Hoskinson on Cardano’s progress and the upcoming Chang hard fork. During an Ask Me Anything (AMA) session on July 7, Hoskinson discussed the ongoing efforts and milestones of Cardano, stating that the Chang hard fork is almost ready.
Hoskinson reflected on the challenges and achievements that the Cardano ecosystem has encountered over the past few years, acknowledging that it has been a long journey. Despite facing obstacles, particularly in governance, the ecosystem has managed to overcome them and achieve significant milestones. One of these milestones is the completion of all elements of CIP 1694, which took about two years to finalize but is essential for Cardano’s architecture.
The core of Hoskinson’s update was the announcement that node 9.0, which is crucial for the Chang hard fork, is nearing completion. The Chang hard fork represents a significant upgrade for the Cardano ecosystem and is expected to initiate the transition to the Voltaire era. This marks the final stage of Cardano’s roadmap to create a fully decentralized blockchain ecosystem, a project that has been in the works for two years.
Looking at historical performance, there is potential for a significant rally in ADA’s price leading up to the upgrade. In 2021, ADA experienced a substantial spike in price, increasing by 130% from $1.35 to $3.10 within a month prior to its last major upgrade.
The growth of the Cardano network also contributes to ADA’s upside potential. Over the past month, the number of active addresses on the Cardano blockchain has increased from 21,560 to 36,700, and new addresses have risen from 6,110 to 10,420. Additionally, addresses holding 10 million-100 million ADA have been increasing, indicating confidence in the long-term potential of the token’s price.
Last week, Cardano funds received $100 million in net capital flows, further demonstrating positive sentiment towards ADA. This brings the year-to-date inflows to $9 million, according to the CoinShares weekly report.
ADA’s rise today is accompanied by a growing bullish divergence between its price and the relative strength index (RSI). While ADA’s price formed lower lows between June 17 and July 7, its daily RSI formed higher lows. This divergence indicates strength in the prevailing uptrend, prompting traders to buy more during local dips.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and take appropriate risks when making investment decisions.