As the cryptocurrency market has a price correction, ADA and SOL lead the way

Solana's SOL, Cardano's ADA tokens, and other alternative cryptocurrencies have taken a greater blow than bitcoin and ether in the crypto market. The move seems to be typical of a pause seen following significant rises.

According to data provider Messari, ADA was trading at $2.67 at 10:53 UTC, indicating a 7.6% 24-hour decrease, while SOL was trading at $68, representing a 13% loss. Today, ADA made its debut on Japanese cryptocurrency markets. Sebastien Guillemot, the CTO of dcSpark and a former executive of Cardano-founding company EMURGO, praised ADA's entrance into Japan earlier this month, comparing it to a listing on Coinbase, the U.S.-based, Nasdaq-listed crypto exchange and institutions' favorite method of acquiring bitcoin.

XRP, polkadot, and dogecoin all lost more than 8% of their value. Meanwhile, bitcoin was trading for $47,500, down 3.7 percent, while ether was trading at $3,100, down 5.5 percent. All sub-sectors were glowing red, including decentralized finance and non-fungible tokens.

Alternative cryptocurrencies seemed to be ready for a fall, according to analytics company Laevitas, since maintaining long holdings in several of the coins had grown prohibitively expensive. “Paying over 100% annualized for longs can't be maintained indefinitely,” Laevitas said on Twitter, adding that the price decrease seems to be a good correction.

Some cryptocurrencies, such as ADA and SOL, seemed to be overbought, having lately risen to new highs and surpassed bitcoin by a large margin. For example, in the last four weeks, ADA has gained 187 percent and SOL has gained 272 percent, more than twice as much as bitcoin has gained 70 percent.

“The cryptocurrency pair of Cardano (ADA) and Solana (SOL) has witnessed a stratospheric increase in price and value recently, with both setting new all-time highs of $2.97 and $81.81 respectively,” said Pavel Shkitin, CEO of cryptocurrency exchange Nominex.io. “Despite the superiority of both tokens' technology, the recent rise has been unusual, and the present reverse is an anticipated reaction.”

Since we've seen the market signal that a short-term peak has been achieved, it's natural for investors to decrease exposure and take gains in order to join at a cheaper price, according to James Wo, founder and CEO of the Digital Finance Group.

On Wednesday, Bitcoin, the most valuable cryptocurrency by market capitalization, seemed to be taking a breather, with exchanges reporting higher coin inflows amid continued whale selling.

In Ethereum's ether token, similar patterns were seen. On Monday, exchanges received 779,880 ETH, the highest since June 21st, according to blockchain analytics company Santiment. “Based on on-chain evidence, it seems to be a whale seeking to profit,” Santiment said in a research report released Tuesday.

Analysts are optimistic about the long-term prospects of major cryptocurrencies. After Friday's Jackson Hole Symposium, Laurent Kssis, managing director of exchange-traded products at 21Shares, expects institutional demand to return to the bitcoin market.

Shkitin of Nominex.io believes that the so-called Ethereum killers ADA and SOL will resume their upward trend. “These price reductions are at most transitory, and a turnaround is likely in the short to mid-term,” he added, citing what Cardano is poised to bring in via its next Alonzo update and Solana's blossoming fundamentals.

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