The cryptocurrency market continues to witness volatility as Cardano (ADA) experiences a notable rebound. On Thursday, July 3, 2025, Cardano’s price surged to a high of $0.60, marking an impressive increase of over 17% from its June lows. This significant gain also pushed ADA’s market capitalization past the $21 billion mark, a milestone not reached since June 18. However, amidst the excitement, a closer analysis reveals that Cardano has formed a risky technical pattern that investors should monitor closely.
The recent rally can largely be attributed to a critical development from Fluid Tokens, which successfully conducted the first on-chain transaction to prove the Bitcoin (BTC) state on the Cardano network. This historic event signifies the beginning of a Cardano-Bitcoin bridge, presenting an unprecedented opportunity for ADA to integrate Bitcoin’s liquidity within its ecosystem.
Charles Hoskinson and the dedicated Cardano development team have been tirelessly working on integrating Bitcoin into their blockchain. This innovative approach holds the promise of allowing trillions of dollars in value to flow seamlessly through the Cardano network. As the narrative around this integration evolves, the excitement within the community is palpable, with many advocates proclaiming, “Cardano is the future.” The adoption of features like Bitcoin yield generation within Cardano further fortifies this bullish sentiment.
Despite these optimistic developments, skeptics argue that similar yield generation mechanisms already exist on platforms like Solv Protocol and Babylon, potentially diluting Cardano’s unique selling proposition. Moreover, critics label Cardano a “ghost chain” due to its relatively stagnant DeFi activity, with total value locked (TVL) standing at below $318 million and a stablecoin supply lingering around $31 million. These metrics highlight that Cardano is struggling to keep pace with emerging networks such as Unichain and Sui.
From a technical standpoint, Cardano is currently exhibiting a rounded top formation, signaling potential bearish momentum. After dropping to a critical support level of $0.519 in June, ADA has established an inverse cup-and-handle pattern with a depth of approximately $0.344. As ADA remains below its 50-day and 100-day moving averages, the indicators lean towards a bearish outlook, raising concerns of a potential breakdown. A decisive drop below $0.519 could open the floodgates for further declines, possibly targeting $0.50 and below.
