What potential does Cardano (ADA) have?
Cardano has consistently positive metrics and many projects, but that doesn’t help the course. One analyst puts the reason for this in ADA’s strong correlation with Bitcoin.
Cardano is one of the most influential crypto projects with many interesting developments. In 2021 it was voted the most advanced crypto project on Github. However, there were several issues that caused Electric Capital to not even mention the cryptocurrency in its 2021 top 10 developer metrics. But now, before the start of the SundaeSwap, the number of unique wallets increased by 50%, which can only be attributed to the positive expectations, because nothing substantially new had become known. But after launch, customers reported failed transactions.
According to a YouTube analyst who shares his views with the crypto crowd on a channel called Coin Bureau, Cardano is still among the top because he sees the failures being caused by an overload of hundreds of thousands of customers at once, “which no other blockchain does would endure,” he says.
“At least the blockchain hasn’t gone under like Solana’s.”
How far has Cardano come?
The Cardano project called Hydra is still under development and it aims to solve most of the pending problems. With Hydra, the developers want to ensure that each staking pool can process a thousand transactions per second, with over 3,000 staking pools that means over 3 million. Also , according to on-chain data, large investors are accumulating hundreds of millions of ADA in preparation for future price increases.
However, these positive outlooks are not currently reflected in the ADA price. According to Coin Bureau, that’s because ADA is highly correlated with Bitcoin. Bitcoin has been in a downtrend since September of last year, and it was the same period when Cardano’s smart contract went live. Customers expected dozens of DApps to be deployed on day one. However, that was not the case. It later became clear that Cardano’s DApps would not be deployed anytime soon, forcing customers to sell.
Key figures do not reflect the course
Despite the stagnant price, the number of unique Cardano wallets has grown by more than 50% and the number of Cardano assets has more than doubled, with dozens of DApps deployed and hundreds under development. This means that most of the demand comes from institutional retail investors.
“The pressure to sell has to come from somewhere. I suspect that the IOG, EMURGO and the Cardano Foundation are working to expand the team and improve the partnerships, so that there will be serious growth in the long term, but there will also be selling pressure in the short term.”
Cardano’s roadmap is divided into five phases and it is currently in the third phase called Gogen, which is based on a smart contract. The last two phases, Basho and Voltaire, should be completed by the end of the year.
The company is also working on another scaling solution called “pipelining”. According to the analyst, the ADA price is grossly undervalued and has the potential for a huge run higher.