Cardano Is in a Tight Range — But It Needs a Catalyst to Move Higher Once More

Cardano (CCC:ADA-USD) has been trading in a tight range for several weeks, confounding bulls. Recent oscillations suggest ADA will continue to accumulate within its immediate resistance and support levels. It needs a catalyst to support positive price momentum.

Cardano (ADA) token with blue and orange digital background.

Source: Stanslavs / Shutterstock

Since launching in 2017, it shot past several altcoins in three years to become one of the biggest digital currencies by market capitalization — an astonishing rate for any new currency entering into circulation.

Cardano is a third-generation platform, and it’s more secure than other cryptocurrencies. ADA has overcome challenges that previous platforms faced — making this cryptocurrency exceptionally scalable as well as decentralized with an emphasis on horizontal scaling through its Ouroboros Hydra protocol.

The proof of stake protocol guarantees mathematically proven safety. With a jump in cyberattacks in the crypto sector, safety is critical. Cardano provides unparalleled protection against hackers with its innovative approach to privacy features for both users and developers alike.

For these reasons and more, Cardano is an intriguing altcoin. It performed well during August’s bull market due to its robust features such as scalability, security, and stability. But the recent sluggish performance makes it an affordable contender for your crypto wallet.

Regulatory Pressure and Cardano

Regulators are scrutinizing the crypto industry more closely to ensure there is no misuse and exploitation. They also aim to protect investors from money laundering, ransomware attacks, fraud, and disappearing coins. Unfortunately, whenever there is an increase in regulation, it slows down the adoption of digital currencies. 

“In DC, the Treasury Department does everything in its power to try to kill our industry,” according to Cardano founder Charles Hoskinson.” He added, “A $2 trillion industry just pops up in our backyard, and my government’s trying to kill it.”

Regulatory clarity in the cryptocurrency space will help to ensure widespread adoption and market stability for this new technology. However, some of the recent moves around the world are noticeably heavy-handed. The U.S. Treasury banned its first crypto exchange in late September.

Similarly, there is a substantial uptick in European governments taking a hard stance against digital coins like Bitcoin (CCC:BTC-USD). Investors are therefore on edge as they await further guidance from their respective nations’ financial regulators. But there may be some light at the end of tunnel. African countries’ initial coin offerings indicate that there are administrations that want to make finance more accessible than ever before while ensuring safety standards cannot get lost. Major market players also understand the need to service the unbanked.

Financial services are a global concern, with two billion people worldwide lacking access to financial transactions. There are various ways in which individuals’ data can be withheld from traditional sources including only using mobile phones for money management or keeping personal records under wraps. Cardano and other digital currencies help address this disparity. In the near term, Cardano will continue to come under pressure because of a traditionalist approach towards finance.

Judging Cardano on Its Merits

Cardano is a third-generation cryptocurrency that has broken ground in the blockchain industry by being both secure and sustainable. The developers behind this project say they want to give power back to the consumer from large banks. 

It is a flexible blockchain network with security, sustainability, and multiple-layer architectures in order to increase versatility. One reason for the recent surge in ADA’s price is listing on the Japanese exchanges opening it up not just globally but also allowing Cardano access to the world’s third-largest economy. 

With the Alonzo upgrade, Cardano introduced smart contracts. The move will help it widen its reach to more users and eventually find uses for this technology across sectors — which pushes up ADA’s value even higher.

The launch was a resounding success, with over 100 smart contracts being added to the blockchain in just 24 hours. Finally, the Cardano blockchain is a proof-of-stake model using up to six-gigawatt hours (GWh) of energy and can achieve more than 4 million times the efficiency as other protocols. This makes it highly sustainable versus a proof of work system like Bitcoin.

Investors Cannot Sit On the Fence

Cardano represents a safe and reliable investment in an unpredictable market. With its potential for both the short term, mid-term as well as long term — it could be one of your best bets when investing wisely.

Cardano ADA is forecasted to grow substantially in the forthcoming period. The analysts’ estimates vary. But even if the most conservative predictions come true then any buyer will see healthy gains with this crypto asset purchase.

On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience analyzing the stock market and was a former data journalist at S&P Global Market Intelligence.


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