Cardano holds bullish structure as stablecoin market cap surpasses $30 million with USDA launch 

• Cardano flaunts a solid bullish structure supported by multiple buy signals as bulls target a breakout above $1.00.
• Cardano’s stablecoin market capitalization increased 30% QoQ, surpassing $30 million in the first quarter.
• The launch of Cardano-native stablecoin attracted more than $5.5 million in a week with transactions exceeding 3,400.
• Cardano ushered in full decentralised governance by enacting a new constitution.

Cardano’s (ADA) price upholds strong bullish sentiment, trading at around $0.78 on Wednesday as cryptocurrencies broadly reach for higher highs. The smart contract token’s bullish outlook follows major milestones achieved in the first quarter, including enacting a new constitution, remarkable growth in its stablecoin market capitalization and diversity in the Decentralised Finance (DeFi) ecosystem.

Cardano ecosystem hits new milestones in Q1

The solid technical structure showcased by Cardano in shorter time frames follows a report by Messari highlighting the network’s performance in the first quarter. As per the report, Cardano ushered in full decentralized governance with active participation from Decentralized Representatives (DReps). 

The governance upgrade bolstered community confidence with a 13% increase in DeFi diversity score and a 5% rise in the ADA Treasury balance.

Cardano’s stablecoin market capitalisation surged 30% QoQ to over $30 million, largely driven by Anzen Finance’s launch of USDA, a native dollar-pegged digital asset on the protocol.

USDA performed incredibly well with over $5.5 million in liquidity streaming over a week. Stablecoin transactions related to USDA exceeded 3,400 in the same period. 

The stablecoin landscape on Cardano shows varied dynamics. While USDA has been a standout, other stablecoins like USDM from USDMOfficial saw a 40% QoQ increase, reaching $10 million in market share. 

Legacy options, however, had mixed results. Indigo Protocol’s iUSD dropped 20% QoQ. The DJED stablecoin managed a modest 2% gain, per Ruskin’s post on X.

The shift toward reserve-backed stablecoins like USDA aligns with Cardano’s broader strategy to enhance stability and attract institutional interest, especially as regulatory scrutiny looms large over the crypto space.

Looking ahead: Cardano’s upside potential targets $1.00 

The short time frame four-hour chart below reinforces the bullish structure with Cardano’s price sitting above key moving averages, ranging from the four-hour 50 Exponential Moving Average (EMA) around $0.75, which is slightly above the 100 EMA and the 200 EMA at $0.73.

The Moving Average Convergence Divergence (MACD) indicator has maintained a buy signal since Tuesday, reinforcing the bullish momentum. This buy signal occurs when the MACD line (blue) crosses above the signal line (red).

ADA/USDT daily chart

The Relative Strength Index (RSI) indicator’s upward movement at 62 signifies a firm uptrend. Its continued movement toward the overbought region above 70 could see traders buy ADA to take advantage of the potential return above $1.00.

However, if the RSI climbs rapidly toward 70 or beyond, it could signal caution, because overbought conditions often foreshadow a pullback.

Key monitoring levels include the seller congestion at $0.80 (tested on May 15) and $0.86 (tested on May 12). On the downside, the 50 EMA is near $0.75, and the 200 EMA is around $0.73, which could act as support, potentially preventing a drop below $0.70.