Bitcoin has dipped lower recently and has not always been able to sustain itself above $32,000 in some form. Likewise, the chairman altcoin Ethereum has dropped almost 15% in just one week. With market leaders dropping to these levels, Cardano’s always sideways action, even in these turbulent times, has taken some analysts by surprise.
Cardano has always been the altcoin that managed to generate some optimism amid its investors with updates and news about institutional interest. In fact, the altcoin’s value rose 5% after it was announced that it was added to the Grayscale portfolio. The recent successful fork to Alonzo White also provided a transparent basis for further developments in the market. However, is this enough to keep the price of the 5th largest cryptocurrency moving?
What can Cardano’s success be attributed to?
First, an ecosystem backed by strong network reinforcement makes investors have faith in it, and Cardano has done quite a bit of work on that front lately. The asset has held up nicely despite BTC falling by almost 50%, and some of that can be attributed to the ever-increasing pools of active shares in Cardano. According to analyst Benjamin Cowen, the reason why ADA “lasted so well” is the increase in staking that reduced selling pressure so much, that even when the price dropped, people did not stop staking. Cowen traces back this growth in Cardano’s staking, saying:
I said ADA is my primary defense against Ethereum, not that ADA will surpass it; However, in 2017, I said that I had already assumed some troubles related to high GAS prices and I knew that people would look for other solutions.
Analyst’s detailed altcoin analysis
Alternately, the number of active stake pools has seen a steady upward trend, even though the price of ADA has seen some minor dips over the past three months. Another reason why Cardano is doing great is that 70-80% of all circulating supply is staked. Cowen states exactly the same thing:
Humans are not releasing their ADA and instead continue to hold it or add to their stakes, then this will reduce the selling pressure.
On the development front, along with always ecosystem-centric updates, Cardano nodes on Github have also charted an upper-truth trajectory, peaking at around 1731 nodes in July. However, ADA’s development activity and the number of contributors to its development activity have not been too impressed by its price. It is also another indicator of network strength and network confidence in the market. Despite the almost 10% price drop, with Cardano releasing close to $1.2, development activity and contributors to development activity offered healthy numbers.
The difference of Cardano from other altcoin projects
Finally, the analyst made a different comparison with that of other blockchains in the middle of the verification in the Cardano network, emphasizing that the verification and authorization process is much easier for Cardano. Additionally, he argued that Cardano’s encouragement of people to run their own validators and share their validators serves as a free marketing function for them.
As we have already pointed out , on the contrary, many other networks that limit the number of validators tend to centralize and lose this internal, free marketing. Not surprisingly, trading platform eToro recently announced that Cardano surpassed Bitcoin as the most-held cryptocurrency in the second quarter.