Charles Hoskinson warned that Cardano could collapse as several companies go bankrupt.

In a video posted on his YouTube channel, Hoskinson stated that TapTools' closure may not be an isolated case. He believes that the harsh market environment has put enormous pressure on Cardano-based projects, and if the ecosystem does not address its financing and growth challenges, more projects may fail.

This warning comes as the price of Cardano's native token, ADA, continues to slump. According to crypto.news, Cardano's price has fallen 6% in the past 24 hours, recently trading near $0.20. The token has fallen approximately 70% over the past year and is currently still more than 93% below its all-time high of $3.09 reached in 2021.

Why is the Cardano project facing increasing pressure?

Regarding the current state of the network, Hoskinson stated that he anticipated a wave of business failures at the beginning of the year due to the weak cryptocurrency market. He believes that shrinking revenue and limited funds are making it increasingly difficult for teams to continue operating.
 

“I said at the beginning of the year that we would see a lot of bankruptcies because the market conditions were very bad. There would be a wave of collapses in the entire ecosystem.”

While some community members blame him for the current predicament, Hoskinson denies that he has direct control over the network's future. He told the audience that Cardano's problems require the collective effort of the community and ecosystem participants, not the intervention of any one individual.

In addition to these concerns, Hoskinson also pointed to several initiatives aimed at strengthening the ecosystem. According to him, efforts to acquire and commercialize apps on the Cardano platform have faced resistance from some community members.
 

Funding has become another point of contention. Hoskinson stated that proposals involving the use of national treasury funds to support decentralized applications are unlikely to gain support. He pointed out that the recent community vote against holding the annualCardano summit is yet another example of the ecosystem's reluctance to invest funds in growth plans.

“The community doesn’t seem to have much willingness to use public funds to take these projects to a new level.”
 

TapTools attributed the closure to rising operating costs.

Details shared by TapTools indicate that financial realities were the primary reason for their decision to end the project after four years of development on Cardano.

The company stated in a statement on its X website that the continued increase in costs for infrastructure construction, software development, customer support, and ongoing maintenance has become increasingly unsustainable. TapTools added that, under the current circumstances, the company cannot make a responsible commitment to its future operations.

This shutdown has become the focus of a broader debate surrounding the long-term sustainability of projects built on Cardano. Hoskinson believes that if no action is taken, the entire ecosystem may consolidate as smaller applications struggle to survive.
 

Despite the challenges, Hoskinson maintains that Cardano possesses the technological foundation and community necessary to compete. He believes the network is losing developers not because of their technology or ideas, but because of the deteriorating economic environment and the difficulty businesses are facing in surviving.
 

With market pressures persisting and ADA trading near multi-year lows, Hoskinson warns that more companies could leave the ecosystem unless stronger support mechanisms are established for developers and startups operating on the network.
 

What does the ADA price list show?

ADA's continued decline has pushed it to one of the most important support levels since the bull market breakout in 2021.
 

On the weekly chart, ADA recently broke below the long-term support zone of $0.22, and as of this writing, it is trading near $0.20. This price level acted as resistance before the 2021 rally and has since served as support during several market pullbacks.

According to TradingView data, if the price breaks below this area, the next major support area may be around $0.02.
 

Technical indicators remain mixed. The weekly MACD indicator has formed a golden cross, with the MACD line breaking upwards above the signal line and the histogram turning positive. While this suggests that selling pressure may have eased somewhat, both indicators are still below the zero line, indicating that the overall trend remains bearish.
 

Meanwhile, the Aroon indicator shows Aroon Up at 100% and Aroon Down at 0%, which typically indicates strengthening upward momentum. Even so, prices have not yet seen a substantial rebound, and ADA's stock price remains near multi-year lows, failing to confirm this signal.
 

The chart shows that ADA is approaching a key turning point. If it successfully holds the current support area, the price may rebound to the resistance area of $0.35 to $0.40; however, a break below this area could increase the risk of further price declines to historical support levels.