Can Cardano displace Ethereum?

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Cardano is one of the preferred cryptocurrencies with long-lasting staying power. Its ADA coin sits comfortably in the top ten cryptocurrencies ranked by market capitalisation. It’s actually been in this top ten ranking since its launch in 2015. Today it’s in sixth place after Bitcoin, Ethereum, Binance Coin, XRP and Tether. But the landscape is volatile, and only a few weeks ago it was in third place. So things change rapidly.

Cardano blockchain – Photographer: fabio | Source: Unsplash

What is Cardano?

Cardano certainly has several good things going for it. Its technology is superior to many of its peers, and it has strong community backing.

ADA is the digital currency associated with the Cardano platform. It’s named after Ada Lovelace, the world’s first computer programmer.

IOHK (Input Output Hong Kong) is the research lab behind Cardano. Its focus is on decentralization and the challenges it poses to existing global financial systems. The Cardano development team are academics and scientists, and they work closely with academia to have everything peer-reviewed and transparently shared. The Cardano Foundation and EMURGO, along with IOHK govern Cardano.

Is ADA a coin or a token?

ADA coin is the name of the cryptocurrency that’s used on the Cardano platform. But ADA tokens can be used to vote or for staking in the Cardano ecosystem.

Within digital currency wallets, such as Exodus or Daedalus, you can easily stake Cardano ADA for rewards. Once you stake your ADA coin, it becomes an ADA token, which is then used to mine for ADA. If you find some, you’re rewarded with a stake.

Staking is a popular practice among altcoin owners. It is the proof-of-stake (PoS) part of the blockchain network that Cardano is striving for. And this is being developed into a decentralised application (DApp) development platform, complete with multi-asset ledger and verifiable smart contracts.

Last month Graph Blockchain Inc. (CSE: GBLC) invested $300,000 into Cardano for the purpose of staking the ADA coin.

Meanwhile, over half a billion US dollars worth of ADA is currently being delegated to charity-focused initiatives on Cardano through mission-driven stake pools.

Cardano is for the greater good! We are delighted to share that over US$500,000,000, yes, half a billion U.S. dollar worth of ada is currently being delegated to charity-focused initiatives on Cardano through mission-driven stake pools.

Read more https://t.co/9l55kBRGtv — Cardano Foundation (@CardanoStiftung) March 31, 2021 Cardano’s charitable focus – Staking ADA for charity

Why Cardano could replace Ethereum

Cardano is a smart contract platform, as is Ethereum and Polkadot. Many die-hard Cardano fans believe it will eventually displace Ethereum thanks to its high-speed tech and fee free transaction setup.

Ethereum’s value has soared this past year as more high-profile clients jump aboard. Ethereum is also the backbone of the non-fungible token (NFT) marketplace, which has been subject to NFT mania this year, further boosting the Ethereum price.

And Ethereum is also profiting from notable decentralized finance (DeFi) projects which are built on its blockchain. However, Ethereum is expensive to use, and its transaction times suffer from lag. Cardano intends to beat it on both these counts, due to its lightweight design.

Cardano recently undertook a major update called ‘Mary’ which took it a step closer to emulating Ethereum. The Mary upgrade is a hard fork, transitioning the Cardano ledger. This changes its capabilities from simply holding ADA on its blockchain to allowing multiple tokens to be created and exchanged.

WE’RE ON!! We can today confirm that the ‘Mary’ #Cardano protocol update is now fully confirmed for March 1st.

Another key milestone in the #Goguen rollout, the update introduces native tokens & multi-asset support, bringing exciting new use cases for #Cardano 1/3 pic.twitter.com/FFK0cGNbmD — Input Output (@InputOutputHK) February 24, 2021 Cardano’s Mary hard-fork Goguen rollout

This allows it to support stablecoins and users to create NFTs.

Who founded Cardano?

Cardano was in fact founded by none other than one of Ethereum’s original co-founders. Charles Hoskinson stepped out on his own a year after Ethereum was launched in 2013.

He believes Cardano has the potential to help billions of people thanks to its laser focus on the vision of helping people achieve a better quality of life. By building Cardano on DeFi, it’s targeting some of the poorest, hardest hit regions of the world. Hoskinson believes that proving the technology works in places that are close to being deemed a lost cause, will allow its success to speak for itself. This should naturally bring mass adoption elsewhere.

Access to fair and transparent banking has the power to lift millions of people out of poverty to a sustainable level of living. However, with no access to electricity or smart phones then using crypto is impossible. That said, there are many areas of the world where it could make a real difference. So, the kind of customer Cardano is targeting may be a farmer in Ethiopia looking for a way to pay for fertiliser. Or on a larger scale, implementing a fair election process in Senegal. The company has people in these African countries working with the locals to move forward with its vision.

ADA’s price fluctuations

ADA’s price is up 16% in a month and an eye-popping 3,557% in a year.

So what makes its popularity stick? There are three principal reasons. Being widely available to trade is a big one. Coinbase began supporting Cardano (ADA) in mid-March and around the same time, it appeared on the Bloomberg Terminal. This has certainly helped boost its popularity. With a market cap above £40m, it’s also a highly liquid market and institutional investor interest is readily growing.

Ethereum is up 115% year-to-date. Meanwhile, ADA is up 517% year-to-date.

Cardano is operating a low fee, secure, trusted, blockchain system. It aims to provide a balanced and sustainable ecosystem. So, while this continues, Cardano’s ADA is likely to remain a popular cryptocurrency easily rivaling Ethereum and Polkadot.

Forget Bitcoin: I’d Buy These Stocks for Ethereum Exposure

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Diagonal chain made of zeros and ones. Cryptocurrency and mining.

Bitcoin has been around for over a decade now and offered investors a major opportunity for the last few years. After its massive selloff in 2018, though, it wasn’t until 2020 when Bitcoin and the entire cryptocurrency industry began to see rapid gains once again.

There are several reasons why Bitcoin is worth an investment today. So, it’s no surprise to see the digital currency rallying as fast as it has.

There are other cryptocurrencies worth an investment, too, though. Bitcoin was essentially the proof of concept for the blockchain industry. So, while its technology is revolutionary, thousands of cryptocurrencies were created to improve upon Bitcoin’s shortcomings.

Bitcoin is still strictly a currency. The digital coin is used across the world primarily as a store of value and, in some cases, a medium of exchange. One of Bitcoin’s major shortcomings, though, is that its blockchain technology is slow and can be expensive.

Plus, the blockchain can only really be used for sending financial transactions. Bitcoin still has a tonne of potential and could be worth an investment. The best cryptocurrency for long-term investors, though, has to be Ether.

Ether offers more potential than Bitcoin

One of the biggest developments in blockchain technology was to create the ability to send more than just financial transactions. That’s what the Ethereum blockchain is capable of and precisely why it has so much long-term potential.

Having the ability to run smart contracts and decentralized applications on the Ethereum blockchain is crucial. And anyone who is using the Ethereum blockchain has to power it using Ether, the native cryptocurrency of the Ethereum network.

Many different applications are running on the Ethereum network today. However, one of the biggest developments as of late was Visa’s recent announcement that it would begin accepting payments on the Ethereum network.

This goes to show just how promising this blockchain technology is, especially compared to Bitcoin. It also shows why ether such a great long-term investment.

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Ethereum mining stock

One of the most popular stocks over the last year’s crypto boom has been HIVE Blockchain Technologies (TSXV:HIVE).

This is not surprising. HIVE stock is up by more than 2,000% over the last 12 months. One of the main reasons why it’s done so well is because it’s a miner. And these stocks, just like gold stocks mining physical assets, are leveraged to the assets they mine.

That’s also why HIVE is one of the top Canadian stocks to buy if you’re bullish on Ethereum’s potential. The growth stock mines Bitcoin and Ether as well as having exposure to some of the most popular cryptocurrencies.

In its most recent quarter, the third quarter of its fiscal 2021, HIVE saw its revenue from mining grow by more than 150% year over year.

With Bitcoin and cryptocurrency prices increasing rapidly and consistently, HIVE is poised to benefit, making it one of the best stocks to buy today.

Gain exposure directly to Ether

Another option for investors is to gain exposure directly to Ether rather than taking the increased risk and buying a miner.

If that seems like a better investment for you, The Ether Fund (TSX:QETH.U) is a great choice. Cryptocurrencies are already some of the most volatile assets there are. In 2020, the price of Ether alone grew by roughly 475%. That’s an incredible amount.

So, even if you choose the lower-risk option of buying ether directly, and you invest for the long-term, you could still be rewarded very well.

Bitcoin is still a cryptocurrency that offers investors major potential. However, the long-term potential of Ethereum is unmatched by anything. So, if you’re looking for some incredible long-term growth stocks to buy today, I’d start with these two.

The post Forget Bitcoin: I’d Buy These Stocks for Ethereum Exposure appeared first on The Motley Fool Canada.

Why Ethereum Lacks Support At $2,000, Chainalysis Report Shows

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Ethereum (CRYPTO: ETH), the second-largest cryptocurrency by market cap, reached an all-time high of $2,151 earlier this week but has struggled to find support above $2,000.

What Happened: According to a market intel report from Chainalysis, the cryptocurrency’s cost curve suggests that Ethereum’s peak price has a narrower base of support than Bitcoin (CRYPTO: BTC)’s peak price. The strongest level of observed demand for Ethereum (ETH) was at $1,800.

Chainalysis chief economist Philip Gradwell analyzed the cost of acquiring data for the digital asset to determine the demand, and thereby support, at different price levels.

Gradwell observed that similar to Bitcoin, the Ethereum market has changed radically in recent months with a significant increase in the cost of acquisition for 50 million ETH out of a total supply of 115 million.

Why It Matters: The chart above shows the U.S dollar cost of acquisition of Ethereum held on 5 April 2021.

According to the chart, a very large amount of Ethereum is held by entities that acquired it at around $1,800.

Comparatively, the amount of ETH acquired above $1,850 is much smaller, with around 700k being acquired at a total of $1.4 billion.

According to Chainalysis, this means Ethereum’s all-time high price of $2,151 was some way above a large level of support and suggests that the peak was driven by a relatively small amount of demand.

However, Gradwell did note that “Support at $1,500 is particularly strong, with 33.3M ETH acquired above this level at a total cost of $58 billion.”

The economist also pointed out that cost curves since 2016 show that after the 2017 crypto bull run, only a small cohort of ETH buyers continued to hold despite subsequent losses.

“This supports the concern that the highest ETH prices tend to have a narrow base of support, at least compared to bitcoin,” he said.

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