Crypto market analyst Crypto Target proposes that Cardano (ADA) is repeating the same price cycle that played out in 2020 before its rally to over $3 in 2021. According to the trader, ADA is currently in a reaccumulation zone. This is a stage where long-term holders buy steadily before a larger breakout. Crypto Target argues that if this cycle continues, ADA could move into a rally phase and test between $3 and $5.
On-Chain Profits Rise as $109M in ADA Shorts Face Pressure
Santiment data shows ADA’s 30-day MVRV ratio at +20.6%, meaning holders are in profit but not in overheated territory. In 2021, MVRV soared above 80% before ADA peaked at $3.10. This suggests room for further upside if accumulation continues.
In derivatives, open interest has risen as ADA tested $0.97, but funding rates remain neutral. This indicates trader activity without heavy long bias. At the same time, analyst TapTools’ data shows a $109M short liquidation cluster near $0.99. If ADA breaks this level, forced liquidations could trigger a short-term squeeze, supporting the analyst’s bullish view.
The correlation with Bitcoin remains high at 0.8, meaning ADA still depends on BTC’s direction. This was also the case in 2020, when ADA only broke out after Bitcoin’s wider bull run gained momentum.
Cardano Usage and Developer Activity Remain Low
Cardano’s on-chain usage is weaker than before the last bull run. Daily transaction volume is about 309.7M ADA, well below the multi-billion levels that accompanied ADA’s climb in 2021. Developer activity has also slowed, with daily contributors down to 32, compared to over 150 a year ago. Both suggest less ecosystem momentum than in the past cycle.
DeFi adoption provides a partial offset. Minswap, Cardano’s largest DEX, holds ~105M ₳ in TVL, showing steady but modest growth. While this is small compared to Ethereum or Solana, it shows a functional DeFi base that was largely absent in 2020.
Cardano’s fundamentals have also improved structurally. The Chang hard fork in January 2025 brought decentralized governance on-chain, while the Hydra scaling protocol and the Midnight privacy sidechain testnet continue to advance. These upgrades provide technical capacity for growth, but their adoption has yet to accelerate transaction volumes.
Technically, ADA is holding above its 200-day EMA at $0.73 with an RSI of 52, confirming price stability but not yet signaling the explosive momentum that would align with a $3–$5 move.
Cycle Repeat Needs More Fuel
Crypto Target’s projection of a $3–$5 rally finds some support in moderate on-chain profitability, whale accumulation at the mid-tier, technical stability, and a large short-squeeze cluster near $0.99.
But it also faces clear challenges. Network activity and developer engagement are weaker than in 2020, large whales are reducing exposure, and ADA’s price remains heavily tied to Bitcoin’s trend. DeFi growth and governance upgrades improve the long-term outlook, but current adoption levels are not yet strong enough to justify a rapid breakout.
If Bitcoin leads a broader market rally and Cardano’s ecosystem grows further, the 2020 cycle comparison may hold. Without those conditions, however, a move to $3–$5 remains a long-term possibility rather than an imminent scenario.
