Kaspa [KAS] has posted significant gains recently, climbing 12% over the past 24 hours and 23% over the past week. However, on-chain data reveals a contrasting trend, with network activity declining sharply even as the price advances.
On-Chain Activity Weakens
Daily Active Users (DAU) on the Kaspa network dropped 78% between September 17 and the time of reporting, falling from 36,570 to approximately 7,910 addresses. Transaction volume also declined, with standard transactions in the past 24 hours dropping from about 208,480 to 113,530—a loss of over 94,000 transactions.
One exception to the decline was Coinbase transaction activity for Kaspa, which maintained relatively stable levels, suggesting U.S. investors retain a stronger bullish outlook than broader market participants.
Price Support and Liquidity
Analysis of liquidity clusters on the Liquidation Heatmap indicates a potential support level around $0.038 should the asset experience a pullback. Currently, liquidity clusters are positioned below the price, with limited clusters above it. The most significant depth remains near the $0.038 level.
What's Driving the Rally?
Despite weakening on-chain metrics, sentiment has emerged as a key driver of KAS's price performance. Sentiment measured at 4.81 on a scale between -10 and 10 indicates strong bullish positioning. Perpetual derivatives markets are also supporting the rally, with both Funding Rate and Open Interest remaining in bullish territory.
As long as sentiment remains elevated and derivatives positioning stays bullish, price momentum is likely to persist, though the disconnect between on-chain activity and price suggests caution about sustainability.
