Cardano (ADA) continues to hold steady around $0.58 during Thursday morning trading in Asia, following an 8% rebound from the previous day. This recovery comes amid renewed regulatory uncertainty in the crypto market, as the U.S. Securities and Exchange Commission (SEC) has paused its approval of Grayscale’s proposed Digital Large Cap Fund (GDLC) just one day after initially greenlighting it.
The SEC announced Wednesday it would conduct a deeper review of the GDLC approval, citing Rule 431 of its procedures. In a formal notice, the agency stated: "Pursuant to Rule 431 of the Commission… the Commission will review this approval action. Under Rule 431(e), the July 1, 2025 approval order is suspended until further Commission action." The SEC also confirmed it would inform the New York Stock Exchange (NYSE) of any relevant decisions moving forward.
This development adds a layer of caution to an otherwise optimistic market sentiment, particularly for altcoins like Cardano that stand to benefit from broader institutional adoption through spot ETFs.
Grayscale’s GDLC Proposal and Its Impact on ADA
Grayscale’s GDLC fund aims to transition into a spot ETF, holding five major cryptocurrencies: Bitcoin (BTC, 79.90%), Ethereum (ETH, 11.32%), Ripple (XRP, 4.99%), Solana (SOL, 3.01%), and Cardano (ADA) at 0.78%. With approximately $774 million in assets under management, the fund represents a significant step toward mainstream crypto investment vehicles.
Although ADA's weighting is relatively small, inclusion in such a high-profile product signals growing institutional recognition of Cardano’s long-term potential. The pause in approval does not cancel the proposal but delays it—potentially for weeks or months—leaving investors in a wait-and-see mode.
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Despite this uncertainty, market participants remain bullish on ADA, driven by strong derivatives activity and improving technical indicators.
Market Sentiment Boosted by Macroeconomic News
While regulatory clouds loom, positive macroeconomic momentum has helped lift crypto prices. Former U.S. President Donald Trump’s announcement of a new trade agreement between the United States and Vietnam sparked optimism across financial markets. The news contributed to a broad rally in digital assets on Wednesday, with Cardano leading gains, surging nearly 8% before stabilizing at $0.58 by Thursday morning in Asia.
This demonstrates how external geopolitical and economic factors can influence crypto valuations—even when sector-specific headwinds exist. For ADA holders, the combination of favorable macro sentiment and growing on-chain confidence paints a promising picture.
On-Chain and Derivatives Data Show Strong Bullish Momentum
Key metrics from on-chain analytics and derivatives markets suggest traders are increasingly confident in a near-term price increase for ADA.
Bullish/Bearish Ratio Hits One-Month High
According to Coinglass data, the long-to-short ratio for ADA reached 1.10 on Thursday—the highest level in over a month. A ratio above 1 indicates more traders are opening long (buy) positions than short (sell) ones, reflecting growing bullish sentiment.
This shift is particularly notable given the recent price consolidation and regulatory hesitation. It suggests that many investors view current levels as a buying opportunity rather than a sign of weakness.
Rising Open Interest Signals Confidence
The open interest (OI) in ADA futures contracts rose 7.04% over the past 24 hours, reaching $861.53 million. This increase is primarily driven by rising buy-side activity, indicating that new capital is entering the market with upward price expectations.
Higher open interest during a price rebound typically confirms the strength of a trend. In this case, it reinforces the idea that the recent surge isn’t just a short squeeze but part of a broader accumulation phase.
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Technical Analysis: ADA Nears Breakout from Descending Triangle
From a technical perspective, Cardano is currently forming a descending triangle pattern—a consolidation structure defined by lower highs and a flat support level.
Key Resistance at $0.58 in Focus
ADA rallied sharply on Wednesday and is now approaching a critical resistance zone at $0.58 on the daily chart. A decisive breakout above this level could invalidate the bearish implications of the descending triangle and trigger a bullish reversal.
If momentum holds, the next target would be the June 11 high at $0.73, representing over 25% upside from current levels.
Confirming Indicators Point to Upside Potential
Two major technical indicators are showing signs of strengthening bullish momentum:
- Relative Strength Index (RSI): The daily RSI is currently at 45 and trending upward toward the neutral 50 level. A sustained move above 50 would confirm that downward momentum is fading and buyers are regaining control.
- MACD Indicator: The Daily Moving Average Convergence Divergence (MACD) formed a bullish crossover last Sunday. Since then, the histogram has remained above zero and continues to expand—signaling increasing upward momentum.
Together, these tools suggest that while ADA remains in a consolidation phase, the balance of power is gradually shifting toward bulls.
Downside Risks: Key Support at $0.49
Should ADA fail to break $0.58 and reverse lower, the next major support level lies at **$0.49** on the daily timeframe. This zone aligns with previous swing lows and could attract strong buying interest if tested.
However, as long as price holds above this level, the overall structure remains constructive for future gains.
Frequently Asked Questions (FAQ)
Q: Why did the SEC pause approval of Grayscale’s GDLC fund?
A: The SEC invoked Rule 431 to conduct a further review of the approval decision. This is not uncommon and often occurs when there are legal or policy considerations requiring additional scrutiny. No official reason has been given yet.
Q: Does inclusion in Grayscale’s GDLC mean ADA will get its own ETF soon?
A: Not necessarily. Inclusion in a multi-asset fund like GDLC increases visibility but doesn’t guarantee a standalone spot ADA ETF. That would require a separate regulatory filing and approval process.
Q: What does a rising long/short ratio mean for ADA price?
A: A higher ratio means more traders are betting on price increases. While extreme levels can signal over-leverage, current readings suggest healthy optimism without signs of overheating.
Q: Is the descending triangle pattern bullish or bearish?
A: Typically bearish if broken downward, but ADA’s strong rebound and rising volume suggest a potential bullish breakout. The outcome depends on whether $0.58 resistance is cleared.
Q: How important is open interest growth for ADA futures?
A: Very important. Rising OI alongside price gains confirms new money is entering long positions—often a precursor to sustained upward movement.
Q: Can macro events like trade deals really affect crypto prices?
A: Yes. Positive macro news improves risk appetite across financial markets, including crypto. It can lead to increased capital flows into speculative assets like altcoins.
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Conclusion
Cardano stands at a pivotal moment. Regulatory delays may slow institutional progress temporarily, but market fundamentals and trader behavior tell a story of resilience and growing confidence. With strong derivatives positioning, improving technicals, and favorable macro tailwinds, ADA appears well-positioned for a potential breakout—if it can clear the $0.58 resistance.
For investors, this confluence of factors presents both opportunity and caution. While upside targets near $0.73 are within reach, vigilance around SEC developments and broader market sentiment remains essential.
As always in crypto, timing and risk management are key—especially when navigating the intersection of innovation, regulation, and market psychology.
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