Cardano’s native token ADA hovered near its year-to-date low on Sunday, Dec. 21, as broader market sentiment remained cautious. This came despite strong momentum in Midnight (NIGHT), a recently launched Cardano-native asset that has quickly gained traction.
At last check, Cardano was trading around $0.3680, slightly above its 2025 low of $0.3476. The token remains nearly 70% below its yearly high, with its market capitalization shrinking from more than $25 billion earlier this year to roughly $13 billion.
Despite the subdued price action, several improving fundamentals suggest that Cardano could be setting up for a bullish reversal.
Midnight token gains traction amid rising demand for privacy-focused assets
One of the key catalysts supporting Cardano’s broader ecosystem is the rapid rise of Midnight (NIGHT). The token climbed to $0.082, marking a 135% gain from its monthly low.
More notably, NIGHT’s rally has been supported by a surge in trading activity. Its 24-hour trading volume surpassed $5 billion for the first time, ranking as the fourth-highest volume in the crypto market, behind only Tether (USDT), Bitcoin (BTC), and Ethereum (ETH).
This figure significantly exceeds Cardano’s own 24-hour trading volume of approximately $307 million, signaling strong investor interest in the Midnight network.
The performance stands out in an industry where newly launched tokens often see sharp sell-offs as early holders exit positions and trading volumes fade. In contrast, NIGHT has maintained momentum, suggesting sustained demand rather than short-term speculation.
Midnight’s rise also coincides with renewed interest in privacy-focused cryptocurrencies, a theme that major industry players such as Coinbase and Grayscale have highlighted in their long-term outlooks for 2026. This broader narrative has supported gains across the privacy segment, including a recent rally in Zcash (ZEC).
Over time, Midnight’s success could help address one of Cardano’s long-standing challenges: accelerating ecosystem activity and attracting new users and developers.
Network upgrades add to Cardano’s longer-term outlook
Beyond Midnight, Cardano developers are advancing the Pentad proposal, a framework designed to strengthen the network by introducing tier-1 stablecoins and expanding oracle infrastructure.
If implemented successfully, these upgrades could enhance Cardano’s competitiveness across decentralized finance (DeFi), payments, and data services, reinforcing the blockchain’s long-term value proposition.
Cardano technical analysis points to a potential breakout
From a technical perspective, ADA may be approaching an inflection point.
On the daily chart, Cardano has fallen sharply from its September high of $1.017 to the current $0.3680 level. The price action has formed a falling wedge pattern, characterized by two downward-sloping and converging trendlines — a structure often associated with bullish reversals.
Momentum indicators are also showing early signs of improvement. Both the Relative Strength Index (RSI) and MACD have printed a bullish divergence, indicating that selling pressure may be weakening despite lower prices.
If a breakout materializes, ADA could rebound toward the $0.5147 resistance level, which previously acted as a support zone in April and June. A move to that level would represent an upside of roughly 40% from current prices.
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