Cardano Faces 32% Price Drop Risk Amid Forensic Audit on Presale Controversy and Transparency Push
Cardano (ADA) is under pressure as technical analysis indicates a potential 32% price decline, with a bearish flag pattern and key support near $0.72, targeting around $0.51. This negative momentum coincides with heightened scrutiny after Input Output Global (IOG) launched a forensic audit of unclaimed ADA vouchers from its presale, following allegations of a 318 million ADA reassignment in 2021. Renowned law firm McDermott Will & Emery (MW&E) and BDO are conducting the audit, with Emurgo supporting the call for transparency and urging community patience. Cardano founder Charles Hoskinson denies misappropriation claims, clarifying that funds were transferred to the governance body Intersect, not to IOG. No audit results have been published yet. Meanwhile, Cardano’s broader ecosystem shows strength, with daily on-chain transactions near 50,000, and its participation at GITEX Europe 2025 set to highlight blockchain’s use in digital identity and AI. While ETF approval hopes and robust network activity offer some optimism, unresolved allegations and regulatory scrutiny are elevating short-term downside risks, increasing ADA’s price volatility. Traders should closely monitor audit outcomes and key price support levels for risk management.
Bearish
The current news cycle surrounding Cardano (ADA) indicates a bearish outlook in the short-term. Technical analysis shows a bearish flag pattern that could trigger a 32% price drop if support near $0.72 fails. Layered onto this negative price setup are heightened fears from the community and market participants due to a newly launched forensic audit into presale voucher controversies and allegations of ADA misallocation. Although founder Charles Hoskinson and Emurgo emphasize transparency and deny the claims, the ongoing regulatory scrutiny and lack of immediate audit results create uncertainty. Historically, such situations have resulted in increased volatility and negative sentiment, even as on-chain activity and ETF speculation provide some fundamental support. Until the audit is completed and the controversy is resolved, traders are likely to remain cautious, influencing a bearish short-term market reaction for ADA.