While Ethereum and Bitcoin have hit several all-time highs over the past two months, Cardano has not seen new highs since September. The launch of smart contracts hasn’t seemed to put much wind in the sails and its market capitalization continues to decline.
Slow Period for Cardano
As of September 2nd, 2021, ADA’s price peaked at over $3, and its market cap nearly surpassed $100 billion. This was followed by a steep dropoff on September 7th alongside the rest of the crypto market, when El Salvador’s Bitcoin law took effect.
Less than a week later, Input Output – the team behind Cardano – confirmed the rollout of the Alonzo upgrade. This brought smart contract compatibility to the network, using the Plutus framework. The ADA price saw a short pump climb back up to $ 2.71 afterwards, but fell back below $ 2.50 the next day.
Things have been relatively bearish for Cardano ever since. It failed to pump alongside Bitcoin in October and has steadily declined to its lowest price point in 90 days. Its market cap now rests below $50 billion, and it’s lost its position as a top 5 cryptocurrency.
Contest for Cardano
Although CTO Romain Pellerin disapproved of the comparison, Cardano and Ethereum were often presented as competitors by the crypto community earlier this year. Even Pellerin himself has pitched Cardano as a blockchain that would be “on par with Ethereum” once smart contracts are ditched, with a much smaller carbon footprint than Ethereum or Bitcoin.
For this reason, Charles Hoskinson – founder of Cardano – even argued that Tesla should accept ADA for payment. In May, Elon Musk announced that his company would cease accepting Bitcoin payments due to the cryptocurrency’s environmental harm caused by mining. As a proof-of-stake chain, Cardano does not require such strong energy consumption.
But while Cardano waited for smart contracts, another blockchain competitor – Solana – saw parabolic growth throughout the year. Its proof-of-history consensus model has generated immense investor interest and enables high volume of TPS and low power consumption and is now the fifth-largest cryptocurrency market cap.
