What Can You Expect From Cardano in 2021?

What Can You Expect From Cardano in 2021?

Towards the end of February 2021, the value of Cardano shot up to a record high, attaining 720% from the start of the year. 

The actual name of the coin running on the Cardano blockchain is ADA, and it managed to overtake some of the big names like BNB and Tether to reach the third position in terms of the highest market cap. Only Ethereum and Bitcoin have a higher market cap than Cardano at the moment. 

History of Cardano

It was introduced in 2017 by Charles Hoskinson, a person who helped found Ethereum. After it was conceptualized, it didn’t try to promote itself, unlike some of the other coins. It underwent two years of rigorous development before it was made available for the general public.

Cardano chart

This chart shows the performance of Cardano after it was launched in late 2017. Soon after its launch, it gained widespread popularity, and the topmost exchanges started selling the coin. Starting with a value of $0.021, it eventually reached a price of $1.22 in January next year. 

This means that within a short span of three months, it managed to generate a return of 6000%. Additionally, it increases its market cap from $0.56 million to $31 billion. Many individuals started buying it due to the technical advantages it offered over other coins, and due to the fact that it was supported by an efficient team.

In the initial quarter of 2018, this coin exhibited a steady fall in prices. 

Cardano chart

Then within a month, it managed to triple its worth, and in 2021, it has reached $0.35.

Why should you consider investing in it?

It is natural to be skeptical when it comes to new cryptocurrencies. Ethereum, for example, succeeded because it presented some fundamental advantages in terms of transaction mode. 

You should generally avoid some of the sister currencies of Bitcoin because they will never create independent markets for themselves.

Cardano has some similarities to Ethereum. It is based on sound technology and has the potential to upset the traditional way in which monetary transactions are carried out. 

When you trade in the ADA coin, you need to pay no more than 25 cents in transaction costs. This is much less compared to the 1.5-5% commissions that have to be paid for credit cards and traditional banks. If more and more people start using it, there is a likelihood that financial institutions can get replaced by ADA.

Factors influencing the price

Here are some of the elements that influence ADA’s worth:

  • Adoption: As a larger number of people start to use Cardano, its price will automatically shoot up. The Cardano community is strong, but since it is new to the scene, it would take some time for it to earn a reputation for itself. Cardano aims to be a medium through which people who do not hold bank accounts can carry out their transactions.
  • Competition: As far as the cryptocurrency market is concerned, Bitcoin still holds the top spot, and any new coin that enters the market has to compete with it. Many coins have tried and failed to do this, but it should be kept in mind that it also causes the value of some coins to appreciate. Hence, as long as things are favorable for Bitcoin and other major coins, you can expect the value of Cardano to appreciate.

Nevertheless, there are cryptocurrencies like Lisk, Block, and NEO that are direct competitors of Cardano. So if the values of these coins increase, Cardano’s price may depreciate. The cryptocurrency market is extremely susceptible to change, and it needs to update itself to stay ahead of the curve constantly.

  • Market factors: The value of any asset is influenced by supply and demand in the market. When something is not easily available, its value rises. Since the supply for crypto coins is limited, demand has the likelihood of causing more harm compared to supply. It can cause the value to go up or down.

Pricing reaching new highs

One forecaster predicts the ADA value to depreciate to $1.16 in mid-2021 but then exceed the record high at year-end, reaching a value of $1.52.

 ADA price outlook the next 12 months

Many investors have forecasted a sharp price rise by the end of next year when the value can reach $1.88. The forecasted prices for 2023 and 2025 are $2 and $2.94, respectively.

The sharp rise in value is due to the fact that Ethereum is too expensive for certain individuals. Unlike in Ethereum, in Cardano, all the network nodes are not conflicting about the way transactions are included in the blockchain. While it is still to transition from proof of work to proof of stake, Cardano has already done it, and this offers investors an easier way to mine the cryptocurrency.

Price prediction

Analysts using technical analysis techniques have predicted a modest $0.45 for this coin at the end of 2021. But this does not take into account the strength of teamwork and technology, which Cardano possesses in abundance. Some analysts that consider these elements have predicted a value of $10, which seems a bit too high.

It is highly likely that the true value of Cardano will lie somewhere between $0.45 and $10, but one can never be certain about the cryptocurrency market since it is extremely unpredictable.

Conclusion

As you can see, Cardano has some noticeable advantages compared to other popular cryptocurrencies. It is backed by a solid team and offers more in terms of scalability, security, and advanced features. 

However, you should not expect too much from it since it is a newly launched currency with an unproven track record that has to compete with some of the giants in the cryptocurrency market. 

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