Cardano was officially launched in September 2017, just in time to catch the tail end of the bull market which culminated in December that year. The project’s ADA token was able to rally to highs above $1.20 during that time before going on a lengthy downturn during the so-called ‘crypto winter’ and traded as low 2 cents.
With growing institutional interest in cryptocurrencies, alongside a new roadmap for improvements to the Cardano protocol, the coin has since rallied to new all-time highs in August of 2021. This article explains the background of the project and the plans for the future.
History of Cardano
The project was founded by Charles Hoskinson and is an open-source and decentralized blockchain with its own native ADA token. The project has often been referred to as an “Ethereum killer,” due to its proof-of-stake technology and ability to scale- two things which developers in ETH are currently trying to solve.
Four three years, ADA hovered around the top ten list of cryptocurrency projects measured by market capitalization, but never really hit the big time. That could be changing in 2021 as the coin has displaced other well-known projects to rank at number three in the list behind Bitcoin and Ethereum.
The development of the Cardano project is run by the Cardano Foundation based in Zug, Switzerland. Hoskinson was actually a co-founder of its rival Ethereum but left that project in 2015 after a dispute with Vitalik Buterin. Hoskinson wanted to raise venture capital and create a for-profit entity, while Buterin was keen to remain as a non-profit organization. After leaving Ethereum, he co-founded the IOHK company, where the primary business is the development of Cardano
The project is actually named after an Italian mathematician named Gerolamo Cardano and the project’s token is named after Ada Lovelace, who was an English mathematician and writer.
What’s changed for Cardano in 2021?
The project’s ADA token began to rise in late-2020 as altcoins began to wake up to the strong rally in Bitcoin after the market crash of March 2020, where ADA traded to all-time lows. Institutional interest started to grow in BTC and that drew investors into the market with many looking for cheaper alternatives to Bitcoin.
Cryptocurrency enthusiasts have always had some level of confidence in Cardano and its founder, but larger investors have begun to catch up and the coin’s value was boosted almost tenfold by the end of 2020.
The coin has now seen a move to new all-time highs in August of 2021 and that is down to two reasons: the coin’s development process and the market’s focus on energy efficiency. On the development side, Cardano has been undergoing a change in direction to become a decentralized application (DApp) platform with a multi-asset ledger and verifiable smart contracts. This is the reason that the coin is seen as a growing competition for Ethereum. The energy efficiency issue has become a bigger talking point for investors in 2021 after Tesla founder Elon Musk reversed an earlier decision to accept Bitcoin payments for his cars based on the energy-intensive mining needed for the coin. The proof-of-stake coins are much more energy-efficient and projects with that technology have seen their values increasing this year according to research by investment bank Goldman Sachs.
ADA price history
ADA was launched in 2017 with a value of only $0.02 but the coin landed in the bull market of that year which saw Bitcoin rally to the $20,000 level. ADA saw its own interim highs above $1.20 which lasted almost four years.
The project’s token began to track BTC lower as many altcoins did, and the value slumped to almost touch the launch price in late-2018. The cryptocurrency market saw a rally into the summer of 2019 but Cardano’s project value was subdued as many new altcoins emerged on the scene.
As the market began to pull back again, ADA was dragged to all-time lows below the $0.02 level as the coronavirus market panic saw liquidity sucked from alternative investments and the crypto market suffered.
The recovery in Bitcoin took many by surprise and ADA caught up in late-2020 with a near tenfold increase to $0.18. That was the platform for new institutional interest to emerge in currencies outside the top two and Cardano has seen its project development timeline align well to move to new highs above $2.80 in August of 2021.
If you are interested in capitalising on the market volatility, read on to find out how to start trading ADA with CFDs.
A closer look at Cardano’s technology
The last year has been an exciting one for Cardano fans as the project has met key milestones on the road to becoming a dApp platform. That roadmap has happened at the same time as Ethereum has moved towards the long-awaited 2.0 upgrade, which is expected to improve the energy-efficiency and the ability to scale the project. The Ethereum blockchain has been vital to the rise of the decentralized finance (DeFi) space but that has always been hampered by expensive gas fees for making transactions on the ether chain.
Ethereum has seen key developments in 2021 as it nears solutions to its problems, but Cardano is now emerging as a serious competitor, but its founder Hoskinson has previously said that his project will “kick Ethereum’s butt,” due to its improved governance model.
Hoskinson said: “We’ve chosen radically different scaling models. And actually, I think both of them have the potential of working, but I think Vitalik’s (ETH) are a little bit riskier from an engineering and research point of view. This is why it is so difficult for them to get Eth 2.0 out.”
On governance he added: “It’s less about scalability, it’s much more about governance. When we look at the next 3 to 5 years, and we have a massive advantage in that respect because we made it a priority.”
The ADA token’s rise to record highs this year was boosted recently by news that the project was set to launch smart contract capability in September. Smart contracts are pieces of code that are programmed into the blockchain. With smart contracts, the blockchain becomes a programmable platform that can host applications, and this opens up new avenues for Cardano. The project could attract DeFi platforms, support Non-Fungible Tokens or gaming and could see a big rise in developers using the platform.
How to get ADA
With increasing attention from the media and financial traders, investors are increasingly asking, where can I trade Cardano? There are actually several ways you can hold the cryptocurrency.
One method is to buy it on a cryptocurrency exchange, such as Binance or Coinbase and store it on the exchange or in a digital wallet. It is important to save your private key in a safe place, as without it you will no longer be able to access your crypto, but if it is easily accessible, the coins could be stolen.
As well as buying Cardano you can receive coins by mining them. The peer-to-peer transactions stored in blockchains are checked by cryptocurrency users that allow the use of their computing power in exchange for receiving new coins, known as mining.
Cryptocurrency mining is typically done by computer programmers, while retail investors focus on trading the coins through exchanges and brokers.
Alternatively, you can trade Cardano with Contracts for Difference (CFDS) to speculate on the price movements of the cryptocurrency without having to hold it in a wallet or separate account.
How to trade ADA with CFDs
Are you wondering how to trade Cardano with CFDs? A CFD is a type of contract, typically between a broker and an investor, in which one party agrees to pay the other the difference in the value of an asset between the opening and closing of the trade. CFDs are typically held within shorter timeframes, rather than as long-term investments.
The advantage of using CFDs to trade BTC is that you can profit from your position whether the price of the asset rises or falls. How? You can take a long position if you expect the price to rise, or you can open a short position if you expect the price to fall.
Trade ADA to US Dollar – ADA/USD CFD
There are differences between buying a cryptocurrency and trading a CFD in the crypto market. When buying a cryptocurrency, it is stored in a digital wallet or on the exchange. When you trade CFD, you speculate on the asset’s price movement without actually buying it. Trading CFDs with an online broker, which is regulated by a financial authority, is more flexible as you can benefit not only from an uptrend in the ADA performance, but also from a downtrend, by opening a long or a short trade respectively