The forecast of the ADA cryptocurrency for 2021 looks very optimistic: in this material we will explain what is the reason for the rise in the altcoin rate by 1300% since the beginning of the year and what prospects it has.
ADA (Cardano) cryptocurrency is one of the fastest growing blockchain assets in the cryptocurrency market. Since the beginning of 2021, it has twice hit the top 3 cryptocurrencies in terms of capitalization. In this article, we will tell you how its ecosystem works, how the altcoin grew by 1300% in 2021, whether the ADA cryptocurrency will add value and what to expect from the asset in the coming years.
What is ADA cryptocurrency?
Cardano (ADA) is a blockchain platform created in partnership between Input Output Hong Kong (IOHK) and Charles Hoskinson, former co-founder of BitShares, Ethereum and Ethereum Classic. From the very beginning, it is positioned as an alternative to Ethereum .
The platform specializes in launching smart contracts, decentralized applications, sidechains, and multiparty (secure) computing.
The internal cryptocurrency of Cardano is called ADA. The platform is named after the Italian mathematician Gerolamo Cardano, and the cryptocurrency is named after the English mathematician Ada Lovelace.
The starting point of the history of the new cryptocurrency platform was the proposal of Japanese investors who became interested in the idea of using blockchain technology for smart contracts and signed a contract with Charles Hoskins to develop a new cryptocurrency with high scalability.
During the ICO campaign from 2015 to 2017, the project team managed to raise $ 62 million. Literally a week after the launch, the market capitalization of Cardano increased to $ 500 million, and the daily ADA turnover on trading platforms reached $ 100 million, the interest of blockchain was so high. community to the new coin.
The largest amounts of capital investment came from the countries of Southeast Asia. The cryptocurrency is popular in Japan, South Korea and Thailand.
How the ADA works from the inside
Cardano is written in Haskell, a highly fault-tolerant programming language. The applied Proof-of-Stake Ouroboros protocol provides for the participation in voting of all cryptocurrency holders. It is similar to the new Ethereum Casper protocol, but, according to the creators of Ouroboros, it is the only consensus algorithm whose security can be proved using mathematics.
ADA tokens have a limited supply. The release of 45 billion coins is planned. Already generated about 30 billion. About 10% of them were given to companies that design this platform and are engaged in its development. The rest are distributed among the holders-miners. The emission is entirely dependent on the new blocks. To date, 2,000 coins are produced after the signing of each block. Further, the indicators will gradually decrease. It is planned to complete the issue of the entire volume of coins in 2023.
The Cardano cryptocurrency (ADA) uses its own blockchain called the Cardano Settlement Layer (CSL). CSL is a distributed transaction ledger layer to support cryptocurrency wallet transactions. The second layer, called the Cardano Computation Layer (CCL), will support smart contracts and decentralized applications. This layered architecture allows for easy protocol upgrades and positively impacts Cardano’s outlook.
Financial government regulators are usually skeptical about the use of anonymous cryptocurrencies in the traditional financial system. To overcome this mistrust, the Cardano platform can use cryptographically protected metadata on the blockchain, which will allow interaction with external regulators, while maintaining the confidentiality of cryptocurrency owners to a sufficient degree.
Advantages and Disadvantages of ADA Cryptocurrency
One of the significant advantages of Cardano is the Ouroboros security system. It is she who provides mathematical accuracy in work. With the help of this algorithm, it was possible to significantly reduce the energy consumption when checking the blocks. A special secure programming language testifies in favor of this cryptocurrency.
In addition, the Cardano cryptocurrency (ADA) features fast transactions and the ability to work with digital assets. Any user can create and execute a smart contract, which will secure his money transfers and other operations.
According to nicechange.net, Cardano has a fast transfer speed. This helps to avoid the growth of commissions when it is necessary to speed up the transaction. Additional advantages of this cryptocurrency are complete user privacy and a system of hard forks. They fix network errors without further rollbacks.
A definite disadvantage of Cardano is that the blockchain is still under development. It must solve its scalability issues as it is only capable of processing 257 transactions per second (TPS).
A much bigger drawback is the non-proliferation of Cardano assets. Not all exchangers have tokens. Among other “minuses” – not too much processing of translations. The creators of the cryptocurrency promised to fix this shortcoming by 2020. ” In addition, the cryptosystem has issues with official wallet syncing and network connectivity.
Record growth in the ADA rate in 2021
Since the beginning of 2021, ADA has twice risen to the third place among cryptocurrencies in terms of capitalization. This happened for the first time in February, when the altcoin went up in price by almost a third, and then in mid-August. Then the ADA rate for the week increased by almost 50%, and its value exceeded $ 2, and on August 20, the altcoin rate reached a historical maximum – $ 2.57.
At the time of this writing, the cryptocurrency was worth $ 2.63, and the market capitalization was at about $ 80 billion. In just one day, August 19, transactions were made with ADA for a record $ 8 billion. Since the beginning of the year, ADA has risen in price by more than 1300%.
As estimated analyst firm Messari, due to the rising cost of altkoina, the number of dollar millionaires ADA-holders increased by 173%.
What are the reasons for the growth of Cardano? Investors are awaiting the September update of the Cardano blockchain, dubbed Alonzo. The update should add support for smart contracts and DeFi applications that users have long been waiting for.
Thus, after the release, Alonzo Cardano will become a full-fledged competitor to Ethereum, where smart contracts have existed since the launch in 2015.
The growth of the altcoin rate is also facilitated by the news about listing on more and more new crypto-exchanges. So, on August 25, ADA will appear on sites in Japan.
What is Alonzo and how it relates to the reasons behind Cardano’s growth
Alonzo is a major upgrade to the Cardano network that has been in testing for several months now. The main innovation in it is the emergence of smart contracts .
Before releasing a full-fledged update, the developers tested Alonzo among users in several stages.
The stages were named “colored” – blue, white and purple. The purple stage was launched in early August, and after it there will be two more mini-stages – red and black, during which the last bugs should be cleaned out of the update.
At the first two stages, the number of test participants was limited, and anyone can join the last one.
After that, Cardano will enter the “era of Gauguin”. It is the eras that the developers call the stages of development of their network and give them the names of classical writers, painters and philosophers. Before Gauguin, Byron and Shelley were, and after that Basho and Voltaire were planned. The stages differ in the number of functions that are available on the network.
Where to buy ADA
Cardano is sold for dollars on almost all major crypto exchanges: Binance US, OKCoin, Kraken, Bittrex, EXMO. Also, ADA cryptocurrency can be exchanged for bitcoin, ether or stablecoins (USDT, USDC, PAXX), depending on the site.
On the Kraken exchange, Cardano tokens are sold for euros, and on Upbit and Bithumb – for South Korean won.
Cardano forecast for 2021-22
The Cardano (ADA) rate is quite resistant to inflation, and due to the limited total turnover, the demand for it continues to grow. The decentralized nature of the Cardano blockchain makes it secure, and the layered architecture provides scalability. Taken together, these technical features make Cardano a unique coin with good potential.
For example, the Wallet Investor website predicts that the altcoin rate will rise to $ 4.7 within a year, and to $ 12.5 within five years.
A similar forecast is given by the Digital Coin resource. They believe that the ADA will end the year at $ 3.93, a year later it will cost $ 4.86, and then the rate will add a little more than a dollar per year to reach $ 11.78 per coin by 2028.
In the future, the Cardano (ADA) rate will most likely depend on the number of DApps and smart contracts built on its blockchain. Whether it is worth buying Cardano in light of its unprecedented growth now or waiting for a correction is up to you, but you need to carefully study the charts and news about this cryptocurrency before deciding on an investment and position size.