Cardano Navigates Market Pressure Amid Airdrop Turbulence

Cardano's ecosystem has faced a challenging period, with its native token ADA declining approximately 7.7% to trade near its December lows around $0.39. This downturn coincides with significant volatility surrounding the launch of the Midnight Network's associated token.

Amid the market pressures, a notable development offers a contrasting narrative. Cardano has been included in the Bitwise 10 Crypto Index Fund (BITW), which recently moved to the NYSE Arca exchange. Holding a 0.65% weighting, ADA now sits alongside assets like Bitcoin and Ethereum within this regulated Wall Street investment product, granting traditional investors access through standard brokerage accounts.

Midnight Network Launch Fails to Meet Expectations

The core of the recent turbulence stems from the debut of the Midnight Network, a privacy-focused sidechain built using zero-knowledge proofs. The technology aims to merge private and public transactions through a dual-ledger system—one public, one encrypted—allowing users control over their data visibility.

However, the distribution of its NIGHT token proved disruptive. Following initial listings on exchanges including OKX, Bybit, and MEXC, the token's price collapsed by 90% within two days. The structure of the "Glacier" airdrop, which distributed tokens across eight blockchains such as Bitcoin and Ethereum, generated immediate selling pressure rather than demonstrating ecosystem strength as intended.

Should investors sell immediately? Or is it worth buying Cardano?

Derivatives Data Reflects Waning Sentiment

The cautious mood is evident in futures market metrics. Aggregate open interest has fallen to $773 million, a figure substantially below the October high of $1.51 billion. The market has struggled to recover since a deleveraging event on October 10th that triggered the liquidation of long positions worth $118 million.

From a technical perspective, ADA faces clear headwinds. The price currently trades below the 50-day moving average of $0.434. The Relative Strength Index sits at 37, indicating weakness but not yet an oversold condition, while the MACD indicator has turned negative. Any recovery attempts are constrained by a descending trendline originating from the $0.60 level, with significant resistance awaiting near $0.47.

Foundation Remains as Year-End Test Looms

The coming weeks present a critical test for Cardano, with market observers watching whether support around $0.37 will hold. Underlying development progress continues: the Ouroboros Leios upgrade is advancing, the Hydra scaling solution has recorded peak performance, and plans for a major stablecoin launch are slated for early 2026.

The immediate challenge for the ecosystem is to absorb the aftershocks from the Midnight launch. The key determinants for stabilization will be whether developers actively adopt the new privacy features and if sentiment surrounding the NIGHT token can find a firmer footing.