In the midst of the phenomenal price explosion of Bitcoin over the whole last week, one cryptocurrency in particular has been creeping up steadily.
While Bitcoin went up to $11,500 only to correct at around $10,500, after slumping to around $9,000, Cardano’s ADA token saw an impressive 385% increase in just two weeks. This was backed up by a solid $3.2 billion market cap as of press time. ADA is now trading at $0.123, up from $0.018 the day it was launched on October 1st 2017. Furthermore, the young cryptocurrency made it to the top 10 in terms of market cap. During the night of November 29th, it even surpassed both Monero and Ethereum Classic.
What is Cardano?
IOHK the Blockchain development firm, explains on its website how is Cardano a built-from-scratch Blockchain from a purely technical point of view. The infrastructure supporting the ADA token, is developed over a math-based algorithm (proof-of-stake, a.k.a., PoS) named Ouroboros. The algorithm is believed to make transactions highly secure, fast and reliable.
Besides the ADA token, the project’s developing team praises it as an advanced Smart Contract platform as well.
Partnered with IOHK and its solid team of engineers and cryptographers, Cardano reportedly delivers more advanced features than any protocol previously developed. It’s worth mentioning that IOHK’s CEO is no other than the Co-Founder and former CEO of Ethereum, Charles Hoskinson.
The Cardano foundation, based in Switzerland, is supervising the different entities behind the project. It is currently focusing on its further development. Besides relying on its own Blockchain, cryptocurrency and Smart Contract platform, Cardano developed its own software wallet, Daedalus. The latter can be used to send and receive ADA tokens.
On the other hand, ADA tokens are pre-mined. The total supply is 45 billion, of which 30 billion tokens are already circulating.
As detailed in the roadmap set by their whitepaper, the development philosophy relies on a multi-layered platform. It consequently grants the flexibility of maintenance and the ease of upgrade by means of soft forks.
What is causing the hype?
Until the last seventy-two hours, not that many people have ever heard of Cardano. The ongoing surge triggered all kind of questions on whether is it set to stay or is it nothing short of a pump and dump scheme.
As reported by the Cardano foundation’s official Twitter on November 28th, Bittrex finally added an ETH/ADA trading pair. This will allow traders to get ADAs using Ether and vice versa. Consequently, a tremendous volume of liquidity flooded the asset, coming from both those who have been closely following the project launch and from curious traders attracted by its affordability and high-paced value rise.
Our exchange partner Bittrex have just added a new pairing between ADA and ETH! https://t.co/Z8ZaS1Ydn6
— Cardano Foundation (@CardanoStiftung) November 28, 2017
Less than forty-eight hours following the announcement, Binance listed ADA with both Bitcoin and Ethereum pairings. This granted Cardano an even bigger global exposure, by opening it to the Asian trading markets.
We are pleased to announce Binance is listing Ada with BTC & ETH pairings! https://t.co/pp1mkrn7Vh
— Cardano Foundation (@CardanoStiftung) November 30, 2017
On the same day, another awaited major announcement came to fuel up the upheaval. The foundation retweeted an update from the IOHK official Twitter mentioning an important roadmap update follow-up. Referred to as Shelly, this bootstrap phase is an upgrade from a previous one called Byron. Shelly came to make a substantial improvement to Byron, its preceding phase, and will ensure the technology growth into a fully decentralized and autonomous system, as claimed by the developing team.
— Input Output (@InputOutputHK) December 1, 2017
All of these circumstances, and more importantly, of that happening simultaneously in a short time lapse, boosted Cardano to its highest market value and made it one of the hottest cryptomarket discussion topics recently.
Is the pump going to last?
In a highly volatile market, several similar phenomena have been spotted with other cryptocurrencies. Ripple and Dash being examples among many others. Major announcements can undeniably boost a cryptocurrency’s value to a certain extent, before seeing it correct or even collapse to a much lower one.
One of the factors that can allow Cardano to keep up with its pace is the soon to be launched Debit card by Daedalus, mentioned by cryptocoinnews. It will help boost its use and grant more liquidity to follow into the asset. As for the future of ADA, its performance will highly depend on that of other altcoins, and on the updates yet to be released by the foundation.