The majority of cryptocurrencies traded in the red on Wednesday, as the crypto market extended its drop, with overall capitalization falling below $3 trillion for the third time in a month.
The crypto market capitalization fell to $2.95 trillion, a level that some believe may open the door to further weakness.
The market sentiment has worsened alongside price action. The crypto fear and greed index has dropped to 11, its lowest reading in about one month, remaining in the fear zone.
Major coins are testing intermediate technical support levels as investors reassess risk exposure into year's end.
At press time, Cardano was trading at $0.38, down 1.91% in the last 24 hours and 18% weekly.
Cardano faces liquidation imbalance
According to CoinGlass data, the recent drop in the last 24 hours has resulted in a total of $1.24 million in liquidation for Cardano, of which more than 93% of this figure was that of leveraged longs.
A total of $1.18 million in leveraged longs were liquidated, with shorts coming in at 86,380. The imbalance in long and short liquidation came in at 1,303% as longs suffered the brunt of liquidations.
The next crucial support for bulls to hold is currently at $0.32, where Cardano rose more than 216% in November 2024.
2026 teases major developments for Cardano
The incoming year 2026 hints at major developments for the Cardano network. At the start of December, Cardano’s next protocol upgrade — which proposes an Intra-Era Hard Fork to Protocol Version 11 — was submitted for community review.
The upgrade targets improvements across Plutus performance, ledger consistency and node-level security without changing transaction shape or transitioning to a new ledger era.
In a coordinated step toward 2026, the Cardano Critical Integrations Budget, which proposed an allocation of 70 million from the Treasury to fund a coordinated program of ecosystem-critical integrations, passed community approval in one of the fastest votes since Cardano governance began.
The fund will be dedicated to onboarding tier-1 infrastructure components, including tier-1 stablecoins, institutional digital asset custody and wallets, cross-chain bridges, pricing oracles and advanced on-chain analytics.
