2023-2-20 00:21 |
Cardano (ADA) continued to gain this week after a brief pullback in early February. In the past 72 hours, the cryptocurrency surged over 17% to tap $0.41 amid a market-wide lift-off before recoiling on Sunday. At press time, ADA was exchanging hands at $0.40, down 0.77% in the past 24 hours, according to CoinMarketCap data.
ADA’s attractive price growth can be traced to several developments around Cardano’s ecosystem. According to a report by crypto research firm CryptoCompare, the Total Value Locked (TVL) on the Cardano blockchain rose 49.9% in January, reaching levels last seen in August 2022. This growth was led by decentralized protocols, with lending protocols such as Meld and Indigo growing by over 48% and 76%, respectively. At the time of reporting, Cardano’s TVL sat at about $126M, as seen on DefiLama, showing that growth continued in the first half of February.
The report also highlighted Cardano’s price growth in January, stating that “this was the best-performing month for the asset since August 2021.” The No. 7 cryptocurrency by market cap benefited from a market-wide crypto lift-off last month which saw its price recover by just over 70% from a record bottom of $0.25. Cardano’s attractive price action was accompanied by a spike in trading activity, with volumes on centralized exchanges rising roughly 158% to $9.87B.
“This was the first increase in trading volume for the asset in thirteen months, a much-needed rebound after hitting the lowest monthly trading volume since October 2020 in December 2022,” said the firm
Earlier this month, the much-awaited Djed stablecoin went live on the Cardano blockchain, sparking a wave of excitement for the community. Barely two weeks after launch, the so-called overcollateralized stablecoin has garnered over 31 million Cardano (ADA) coins as backing. As of Feb 16, there were 31,200,698.37 ADA in its base reserves, accounting for a 514% collateral ratio. Furthermore, the market capitalization of Djed had increased from $1.7M at launch to $2.17M at press time, suggesting some adoption of the pegged asset.
During a Twitter Spaces session on Tuesday, Binance CEO Changpeng Zhao noted that the crypto industry would likely “look for other options” as regulators tighten the nose around stablecoins. This suggests that non-dollar-backed stablecoins such as Djed and other algorithmic stablecoins may begin to emerge, propelling the entire crypto industry towards complete decentralization.
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