Cardano (ADA) Price Prediction: Despite Serious Allegations Against Its Founder, the Cryptocurrency Is Maintaining Support Around $0.74

ADA is up 1.4% in the past 24 hours but remains down 5.6% over the past week. This may be due to the emergence of allegations against Charles Hoskinson

A serious allegation against Cardano founder, Charles Hoskinson, has brought a slight downfall to the cryptocurrency. However, despite the claim and ensuing backlash, ADA managed to maintain support around $0.74.

The cryptocurrency is up 1.4% in the past 24 hours but remains down 5.6% over the past week. With a 24-hour trading volume of approximately $856 million, market activity has slowed but remains steady.

What Happened: NFT artist Masato Alexander brought the allegation against the Cardano founder on May 7.

The artist claimed that Hoskinson misused privileged access to move about 318 million ADA during the 2021 Allegra hard fork. At the time, this sum was worth roughly $619 million.

According to Alexander, the small amount, about $7 million, was formally given to the Cardano governance group Intersect. The artist compared the incident to the 2016 Ethereum DAO hack but argued that Cardano lacked similar community oversight.

However, in a statement to Blockworks, Hoskinson strongly denied these claims, calling them false and damaging.

The founder stated that over 99.8% of ADA from the 2017 token sale was redeemed. According to Hoskinson, the remaining unclaimed funds, which he estimated to be around 18 to 24 million ADA, were later donated to Intersect.

He further explained that the October 2021 transaction was part of an automated process to prevent unredeemed tokens from becoming unusable.

"It was a standard procedure to collect dust and move it to a new account to prevent it from becoming unspendable after the hard fork went live. This was a chain maintenance activity coordinated with the Cardano Foundation and community members."

Technical Indicator Of Note: As the dust settles from the controversy, technical indicators suggest that ADA is in a consolidation phase.

The relative strength index stands at 51.7, indicating neutral momentum. The MACD shows a negative crossover with little upward pressure, suggesting somewhat bearish conditions.

Examining moving averages, the 10-day and 20-day EMAs and SMAs currently act as resistance, indicating short-term selling pressure. However, longer-term support comes from the 30-, 50-, 100-, and 200-day moving averages, which continue trending upward.

ADA’s ability to maintain its position above the 100-day EMA at $0.73 may be crucial to preventing additional losses. If bulls retake the 10-day EMA at $0.76, ADA could move toward $0.78 or higher.

If current support levels fail, the price may drop below $0.72 and possibly reach $0.70 or even $0.68. With both bulls and bears waiting for a catalyst, the outlook remains neutral.

On the daily timeframe, ADA price has established a rising trend in recent weeks. After breaking out of a macro-falling wedge pattern in April, ADA has gradually gained bullish momentum characterized by higher highs and higher lows.

In the four-hour timeframe, ADA price has formed a falling symmetrical parallel channel, likely a continuation pattern. A consistent close above the upper border of this falling channel could trigger a fresh rally toward a short-term target of about $1.14.

The large-cap altcoin, with a fully diluted valuation of $33 billion, continues to move in tandem with the wider altcoin market amid anticipated altseason. On-chain data analysis shows increased capital inflow to crypto investment products, fueled by geopolitical and economic uncertainty.

Cardano remains far from its all-time high of $3.09 set in September 2021, sitting nearly 75% lower today. An on-chain investigation is expected to be conducted in the coming weeks to address the allegations against Hoskinson.