“ An intelligent investor sees an opportunity in dip than risk.”
Recently, Cardano’s ADA token saw its market capitalization rise to $98.91 billion to become the 3rd largest cryptocurrency on 2nd September. However, this triumph was rather short-lived since its M-cap started falling due to the crypto flash crash, followed by China’s announcement that deemed cryptocurrency transactions illegal.
Even if you are new to the world of cryptocurrencies, Bitcoin and Ether are the names that most users are familiar with. But since few days, crypto experts and people around the world started talking about a lesser-known cryptocurrency, Cardano, and are calling it the one to watch out for. Cardano with its native virtual currency ADA became the third largest cryptocurrency in the world in August 2021.
Cardano was founded by Charles Hoskinson, who is also the co-founder of Ethereum, but later left after some disagreements and issues over how it should be run. From the beginning, Hoskinson was determined to do things differently. Every step of platform development has been peer-reviewed; experts built this new blockchain from scratch and for this reason, ADA has been in the top 10 currencies by market capitalization since its launch in 2015.
But recently its market capitalisation surged drastically. This poses a question as to why is market capitalization important? It is one of the primary ways for investors to gauge whether or not a coin is safe to buy as compared to its peers. The higher the m-cap of a digital asset, the more dominant it is considered to be in the global market.
What works best for Cardano is the fact that it is one of the few highly valued cryptocurrencies that has "sustainable" and environment-friendly properties. This is significant at a time when conversations about the sustainability of cryptocurrencies have led to the stumbling of big players like Bitcoin. Bitcoin even fell out of favor with its former supporter, SpaceX founder Elon Musk, who cited a lack of sustainability as a reason to ditch it in favor of Dogecoin.
Cardano has set itself the goal of creating a more effective, economical and efficient system to save energy. There is an innovative and specialized team of experienced engineers, researchers and experts who give Cardano an added edge. Cardano has even claimed that they are the greenest and most environmentally sustainable cryptocurrency in the world, since they only consume about the same amount of energy as 600 U.S. homes each year. On the other hand, Bitcoin uses roughly the same amount of energy as the Netherlands each year. They claim that their state-of-the-art proof-of-stake blockchain system is more energy efficient.
However, its price has been falling since September 7, major reason being the crypto flash crash. It is now surpassed by Solana. Cardano (ADA) is fighting alongside the other cryptocurrencies. The asset had been well behind the $ 2 price since mid-August, with indicators pointing to a path towards $ 5 after the updates. But with the current sudden crisis, the digital asset lost more than 18% of its value. This created a downtrend, with ADA hitting the 2 lows for the first time in three weeks.
This was followed by the major announcement of China’s Central Bank making all crypto related financial transactions illegal. "Trading activity related to virtual currency is an illegal financial activity," the People's Bank of China said, warning that it "seriously jeopardizes the safety of people's assets." It further affected its price.
BY:- Gurbani and Amisha
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