Cardano’s Africa Strategy Can Still Make it Successful

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Cardano - Cardano’s Africa Strategy Can Still Make it Successful

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Cardano (ADA-USD) dropped below $1 last week. However, despite the bearish trend over the past few months, the long-term prospect for Cardano could still be profitable. This is due to Cardano’s Africa strategy. If Cardano’s plans in Africa succeed, it could easily be one of the most significant cryptocurrency assets. However, little information about Cardano’s Africa strategy and its implementation is available. Thus, the current price seems fair as ADA is still not widely used. Moreover, Cardano has to compete with Ethereum (ETH-USD) to succeed and it is likely to be an uphill battle.

In addition, ADA has declined by 70%-plus since the all-time high of $3 in September 2021. On top of that, Cardano’s market capitalization has also dropped from a peak of $95 billion to $31 billion. The broader cryptocurrency market is likely responsible for this decline. However, Cardano has declined more than other major cryptocurrencies in the same timeframe, which can signify falling confidence among investors. If the market becomes turbulent again, investors are likely to sell Cardano first.

On the plus side, Cardano had shown solid growth when the broader market turned bullish for a short period in the middle of March this year. The growth of ADA outperformed both Bitcoin (BTC-USD) and Ethereum when it rose 50%-plus within a month. Still, long-term sustained growth is significantly more desirable and trying to time the market can be very risky. The global economy has also been quite precarious and in the worst-case scenario, speculative assets, such as Cardano, are likely to suffer the most.

I believe that Cardano is currently a buy. However, avoid buying a large position due to the market’s current volatility. Besides, Cardano is unlikely to succeed in competing with Ethereum. Ethereum is still the dominant currency used in non fungible token sales and is ahead in all metrics in terms of adoption. Moreover, major metaverse tokens are also based on the Ethereum blockchain. For now, Cardano’s long-term success is primarily reliant on its Africa strategy. The strategy is still in muddy waters due to the lack of implementation. Thus, I would advise against buying significant amounts of ADA until real work is on the ground.

Disclosure: On the date of publication, Omor Ibne Ehsan 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.


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