Cardano (CCC:ADA-USD) has been on a tear this year, rising more than 800% year-to-date. Investors are excited about its speed and efficiency regarding blockchain networks. Cardano users can use blockchain technology for various purposes such as financial services or even running decentralized organizations.
However, Cardano’s long-term potential is much higher than where it currently stands. With five stages planned out and current progress made, there is no way that Cardano will not reach its ultimate goal: becoming an autonomous system with the ability to grow infinitely more valuable as time goes on.
Cardano’s gains are great. However, they do not compare with some of the other altcoins out there. It is especially frustrating when meme coins are doing so well.
Apart from their utility as a payment method, these coins do not offer much. But because they keep going up, analysts have to take a closer look to see if they are missing anything. Consequently, it is much easier to predict the trajectory of an altcoin like Cardano, which has solid use cases and long-term potential.
Cardano’s Fourth Stage and Its Impact
In 2017, the creators behind Cardano made a new blockchain platform in stages. They designed it to grow and add features with each upgrade while scaling its usage at launch, introducing an exchange for trading ADA tokens.
Rather than wasting energy on mining, Cardano uses a proof-of-stake (PoS) network, making it cheaper for everyone involved. Bitcoin (CCC:BTC-USD), in comparison, uses proof-of-work (PoW) mining, which uses a lot of processing power and electricity. That is why socially responsible investors dislike Bitcoin.
As mentioned earlier, Cardano is looking to work its way to the final stage of its lifecycle. That is when it will create a new community-centered model that’s self-sustainable. Cardano is in its third stage called Goguen.
Goguen is an innovative project that aims to revolutionize the way we think about decentralized applications with Cardano. The team behind this protocol has introduced smart contract capabilities, which will give developers access to robust decentralized apps (dApps) on top of its network, allowing them greater freedom than ever before.
Basho and Voltaire are the next planned stages. Since we are still in the Goguen era, Basho does not have a release date yet. Nevertheless, after the Basho update, Cardano will be equipped to take care of more transactions and scale up faster.
This is made possible with sidechains that allow for multiple blockchains within a network while maintaining security by only allowing certain information on each blockchain at once. It does this all without sacrificing decentralization.
The Voltaire update is a crucial step on the Cardano project roadmap. With this final stage, the platform aims to make its ecosystem operate as a self-sufficient system and provide decentralized transfer technology with scalable capacity that can handle large amounts of traffic easily.
Time Your Exits and Entries
As the Cardano train rumbles along, there will be several milestones along the way as it reaches its fifth stage. The best way to trade this coin, therefore, is to make your exits and entries effectively. Whenever there is an upgrade on the horizon, the time is ripe to invest, and then you can bring the hammer down.
Just take the example of the Alonzo upgrade. The update gave the platform smart contract functionality. Additionally, users gained the ability to create apps that utilize its advanced capabilities. In the runup to the upgrade, we saw a massive surge in Cardano prices.
That means you can utilize a rinse and repeat strategy with Cardano in the next few months, timing your positions with respect to upcoming upgrades.
On the other hand, you can invest for the long haul. Looking ahead, Wallet Investor is very bullish on the coin. Within a year, ADA is expected to reach $3.70 on average, while by 2026, the estimates rise to nearly $12.10.
Meanwhile, DigitalCoin predicts an average price of $3.16 for 2022, which could climb up to as much as $5.10 by 2025. It expects Cardano to continue rising until 2028, when it is predicted that the ADA coin will have reached approximately $7.66.
Incentive to Invest in Cardano Is High
Cardano has more utility than the plethora of meme coins out there. But it’s hard to pinpoint the intrinsic value of its token given the nature of cryptocurrencies.
It’s a bit of an evolution from stocks and bonds to crypto, which is based on code rather than assets or revenue. Hence, in comparison to stocks, digital coins and tokens are hard to value because of their volatility.
However, Cardano allows for more utility because of its real-world applications. As its platform scales and improves, users will likely join or increase their usage of this unique cryptocurrency. That puts it in a different league in comparison to the meme coins out there.
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 in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio. Faizan does not directly own the securities mentioned above.