In anticipation of the release of the Alonzo update, the price of the cryptocurrency rose by more than 125% and updated its all-time high at $ 3, writes RBC Crypto.
How will the development of altcoin affect its value in the long term?
In August, the price of Cardano rose by 125%, and the capitalization of the cryptocurrency more than doubled, which allowed it to take the third place in the list of the largest cryptocurrencies, displacing Tether and Binance Coin. In early September, Cardano’s growth continued and the coin reached an all-time high of $ 3. The rise in price of altcoin took place on the eve of the Alonzo update, which was integrated into the main Cardano network on the night of September 13th.
What is Cardano
Cardano is a Proof-of-Stake (PoS) blockchain designed to develop smart contracts and create full-fledged decentralized applications (dApps). The project was founded by two former Ethereum developers – Charles Hoskinson and Jeremy Wood. In 2014, they left the development of Ethereum due to disagreements with the course of development of the project.
In 2015, Hoskinson and Wood founded Input Output Hong Kong (IOHK), which began developing Cardano. Later, they created the Cardano Foundation, a non-profit organization that also supports the health and development of Cardano. The internal currency used by the Cardano network is named ADA in honor of Ada Lovelace, who is considered the first programmer in history.
The official launch date for Cardano is September 29, 2017. Trading in ADA tokens started on October 1. Since then, the cryptocurrency has risen in price by 9092%.
On the night of September 13th, the Alonzo update was successfully integrated into the main Cardano network. Against the background of the project update, the Cardano price has decreased by 13% over the past day. The developers have warned users that the first decentralized applications on the Cardano network could be problematic and insecure.
1/2 Upgrade successful.
Moments ago, we deployed the #Alonzo upgrade at the epoch rollover.
— Input Output (@InputOutputHK) September 12, 2021
The Alonzo hard fork is the final part of the Goguen era, which aims to create an ecosystem of decentralized applications on the Cardano blockchain. According to the developer roadmap, Goguen is the third era of five planned. The next era (Basho) will focus on improving blockchain scalability. The last era (Voltaire) will make Cardano a fully autonomous decentralized organization that will be run by the community.
Before integrating Alonzo into the Cardano mainnet, the hard fork was tested on the testnet for several months. Alonzo testing was divided into three stages (Blue, White and Purple), during which the functionality of the main innovations was checked. After the update, developers have the opportunity to create smart contracts in the Plutus programming language, which is based on the Haskell programming language.
The head of the Cardano Foundation, Frederick Gregaard, published a development strategy for the project for the next five years in July this year. Gregaard said that as early as 2026, three Fortune 500 companies (the world’s largest companies in terms of revenue) will start using the Cardano cryptocurrency, and the Cardano Foundation will partner with about 50 banks.
We are very happy to share the Cardano Foundation’s strategy delivered by our CEO, @F_Gregaard.
— Cardano Foundation (@CardanoStiftung) July 5, 2021
Also, in the next five years, developers predict an increase in users of the Cardano ecosystem to 1 million people. Gregaard noted that the non-profit organization is now actively working on launching a registry of native tokens for the Cardano Registry platform and creating services for developers.
Prospects of the project
In the long term, Cardano has the potential to rise in price by 3-5 times, says Nikita Soshnikov, director of the Alfacash cryptocurrency exchange service. In his opinion, after the launch of smart contracts on the Cardano blockchain, the network will gradually begin to replenish with DeFi projects, which in turn will open the door for a powerful flow of liquidity.
“It is difficult to even predict the timing of when such a leap is possible, because it is not clear which projects will start working on the Cardano blockchain and how much they will be in demand by users,” the expert explained.
If we take into account only the updates of the Cardano network itself, then their potential is quite enough for the cryptocurrency to rise in price to $ 6 (an increase of 150% from the current levels), Soshnikov predicted. He also recommended that investors looking to buy Cardano make purchases gradually in small volumes in order to evenly distribute the entry price of the asset.
Provided that investors remain interested in Cardano, the asset may rise in price to $ 7-8 by the end of this year, says Artem Deev, head of the analytical department at AMarkets. In his opinion, this is a very likely scenario, since Cardano is one of the most technically advanced projects on the market.
“In general, the interest in such projects is very high on the market now, and if this bullish trend continues, ADA may be able to overcome the resistance level, which is at $ 3.1,” says Vladimir Smetanin, CEO of the Swiss financial company Newcent.
Smetanin also did not rule out a price rollback below $ 2.4 if the bullish trend is broken and the market reverses against Cardano.
Stay in touch! Subscribe to World Stock Market in Telegram.