When a bull run comes, no crypto is left untouched. This time it applies to Cardano better than ever, as it becomes one of the top performers of the whole market. The aggregate value of assets managed within Cardano’s decentralized finance (DeFi) framework has significantly increased, nearing a notable $450 million. This surge is attributed to the growing interest in first-generation blockchain platforms, with Cardano being a primary beneficiary. The total value locked (TVL) in Cardano-related ventures escalated to an impressive $440 million, surpassing the prior high of $330 million recorded in April.
But there is more. Unlike a standard token, ADA benefits from the whole network ecosystem and we are about to shed light on everything that’s happening undr the hood.
Cardano ecosystem goes into top gear
This uptick in Cardano’s ecosystem is part of a broader trend where investors and crypto enthusiasts are diversifying their portfolios across various blockchains, including platforms like Solana and Avalanche. Particularly, Cardano-based initiatives such as the Indigo lending platform and Minswap, an on-chain exchange, have witnessed their TVLs swell by more than 50%, each approaching the $100 million mark.
One notable aspect of this growth is the Djed stablecoin, tied to the U.S. dollar, which experienced a supply surge of over 45% within a week. This is indicative of increasing investor interest in leveraging the stability of this token. Moreover, less prominent protocols like LendFi and Spectrum Finance have seen their value locked increase by a staggering 90%, pointing to a shift in investor strategies towards higher-risk opportunities.
The positive momentum in the Cardano ecosystem has had a ripple effect on the value of its native token, ADA. It didn’t take long until ADA’s price has jumped by about 17% in a single day, contributing to an overall monthly rise of approximately 80%. Additionally, there’s been a notable 100% increase in leveraged future bets on ADA, reflecting heightened anticipation of further price volatility.
The rise in Cardano’s DeFi ecosystem is parallel to the growth observed in other blockchain networks. December marked a milestone for the broader DeFi sector, with the total capital locked across various platforms hitting $50 billion for the first time in six months. This surge was led largely by the Solana ecosystem, amid growing optimism in the blockchain space.
Another secret sauce behind ADA growth
A key factor behind Cardano’s recent success, especially its staggering 5,000% increase, has been identified as significant investment from Chinese investors. Andrew Kang, a crypto industry expert and co-founder of Mechanism Capital, highlighted this trend. He referred to a widely circulated video showing senior Chinese citizens actively learning about BRC20 assets, signifying a strong interest in blockchain technology within this demographic.
This newfound interest from Chinese investors in BRC20 assets has spurred discussions about their impact on the crypto market at large. Cardano, in particular, has seen remarkable growth, with its ADA token experiencing a surge of over 8,603% between 2020 and 2021, reaching a high of $3.1. The bulk of this growth occurred in 2021, further establishing Cardano as a significant player in the cryptocurrency market.
As of December, ADA’s performance continues to be strong, marking a 70% plus increase since the start of the month. This places Cardano as one of the top-performing cryptocurrencies in the current market landscape.
What is Cardano?
Cardano is a blockchain network renowned for its unique approach to sustainability and security in the world of digital currencies. Developed by the Input Output Hong Kong (IOHK) team led by Charles Hoskinson, a co-founder of Ethereum, Cardano stands out due to its academic research foundation. It operates using a proof-of-stake consensus algorithm named Ouroboros, which is designed to be more energy-efficient than the proof-of-work protocol used by Bitcoin.
This approach not only reduces the environmental footprint of the blockchain but also enhances its scalability and interoperability. Cardano aims to create a more balanced and sustainable ecosystem that better accounts for the needs of its users as well as future systems seeking integration. Furthermore, it supports the development of smart contracts and decentralized applications (DApps), providing a robust and secure platform for developers. Its layered architecture separates the settlement layer from the computational layer, allowing for more flexible updates and maintenance. Cardano’s vision is to democratize finance and empower individuals through a more secure, transparent, and fair blockchain platform.
Cardano world news
In the realm of recent advancements, Cardano has been making significant strides, particularly after the launch of the Alonzo upgrade. The critical update introduced in 2021, adds smart contract functionality to the Cardano blockchain, marking a pivotal moment in its evolution. This enhancement allows developers to create and deploy more complex decentralized applications (DApps), opening up a plethora of possibilities for decentralized finance (DeFi), non-fungible tokens (NFTs), and various other blockchain-based applications.
Additionally, the Cardano team has been focused on improving scalability and interoperability with other blockchains, a move aimed at bolstering its position in the competitive DeFi space. There’s also a growing emphasis on partnerships and collaborations with various entities to expand the use cases of Cardano in real-world applications, ranging from education to government systems.