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Cardano Blockchain Faces DDoS Attack — ADA Price Remains Stable But What’s Next?

Last Updated June 26, 2024 3:20 PM
Nikola Lazic
Last Updated June 26, 2024 3:20 PM

Key Takeaways

  • Cardano faced a DDoS attack but remained operational.
  • ADA price dipped below $0.40, hinting at potential recovery.
  • eUTxO model mitigated the attack, ensuring high network reliability.

Cardano experienced a Distributed Denial of Service (DDoS) attack starting at Block 10,487,530. Despite continuous attacks targeting its smart contracts, the network remains fully operational due to its decentralized design, which distributes the network load and prevents a single point of failure. 

The price of ADA dipped below $0.40 on June 17 and has rebounded since, trading stable at around $0.39. As it was in a downtrend from May 21, will this add further to it, or will its resilience shift the sentiment to a positive one? 

Cardano DDoS Attack Details 

Cardano network faced a distributed denial of service (DDoS) attack marked by a surge in malicious activity to disrupt its operations. The attack began at block 10,487,530, involving transactions that executed 194 REWARD-type smart contracts, each spending 0.9 ADA per transaction. Despite the attacker’s strategy to overload the network by creating complex transactions, the decentralized design of Cardano, spreading the network load, ensured there was no significant disruption.

Philip Disarro, founder of Cardano development firm Anastasia, played a crucial role in neutralizing the threat. His prompt public response on X influenced the attacker to cease his activities. In a surprising turn of events, the attacker was attacked, and he apparently lost some funds. 

The extended Unspent Transaction Output (eUTxO) model, which allows independent processing of each transaction, was instrumental in mitigating the impact of the attack and ensuring high throughput and reliability. 

ADA Price Analysis 

Cardano’s price has declined since peaking at $0.80 on March 14. It fell to $0.40 by April 13, then rebounded to $0.44 and reached $0.53 on April 23, where it encountered resistance from a descending trendline starting from the March high. The price dropped again, repeatedly testing the $0.42 support level and establishing a horizontal trading range between $0.42 and $0.51.

ADA
ADAUSD | Credit: Nikola Lazic/Tradingview

On June 17, it finally breached this horizontal support and went further down to a low of $0.35 on June 22; however, there are some signs of a potential reversal. This low interacted with the 0.786 Fibonacci level, after which a 10% rebound occurred.

The daily chart RSI fell to its oversold zone at 27%, indicating ADA might be ready for a major recovery. This is further confirmed by the daily chart MACD, whose moving averages converge to the upside. 

Further confirmation is needed to expect a major recovery, but the first noticeable sign would be an increase past the $0.50 mark. The second would be establishing a higher low on the downturn, and if this happens, we could expect to see a sustained uptrend, potentially leading to $1. 

Disclaimer
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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