A weekend surge saw Cardano rise in the rankings to take fourth place on CoinMarketCap
2021 has been a good year for Cardano so far, with ADA posting gains of around 300% since the new year arrived. The weekend was particularly exciting – not only did ADA rally more than 50%, from $0.44 at the start of Friday to $0.67 at time of writing, but it also crept up the rankings to take fourth place on CoinMarketCap.
After starting Friday at sixth, with a market cap of around $14 billion, Cardano first flipped Polkadot and then Ripple, and currently sits in fourth with a market cap of $20.7 billion, just behind Tether whose market cap is $28.8 billion. ADA also hit its three year high last week, though it is still trading at only around half of its all time high of $1.40 which it achieved at the start of 2018.
With Cardano’s emergence as a direct competitor to Ethereum, many have invested in ADA as a hedge against potential issues with the development of Ethereum 2.0. Indeed, Cardano’s Founder, Charles Hoskinson – who also co-founded Ethereum – compounded some people’s worries when he critiqued the Ethereum 2.0 scaling model in an interview with Ben Armstrong last week.
“We’ve chosen radically different scaling models,” Hoskinson explained. “Actually I think both of them have a potential of working, but I think Vitalik’s [Ethereum co-founder] are a little bit riskier from an engineering and research viewpoint which is why it’s been so difficult for them to get Eth2 out.”
Another catalyst for the surge in price could be the Mary hard fork which took place last week. Named after Frankenstein author Mary Shelley, the update will unlock decentralised finance on the network and support smart contract development for the first time. Additionally, the news that Grayscale Investments filed for a Cardano Trust, among others, could be having a positive effect on the price of ADA.
As for where ADA could go from here, the relative strength index on both the weekly and daily charts suggests ADA is currently overbought, so we could see some consolidation in the short term. However, with thousands of new Cardano wallets being created every day, there is an increase in large ADA transactions and Google searches of ‘Cardano’ are spiking — suggesting that the Cardano excitement shows no signs of abating in the longer term.