Cardano (ADA-USD), the seventh-largest crypto with a market capitalization (cap) of $40.51 billion, is doing significantly worse this year than Ethereum (ETH-USD), the second-largest crypto with a market cap of $412.44 billion. For example, ADA crypto is down over 16.5% as of Friday, Apr. 1, versus just 8.3% for Ethereum. But Cardano is trying to compete against Ethereum. It is trying to pick up new smart contract users and attract new developers and decentralized applications.
The good news is that Cardano is making progress in this regard. DefiLlama.com shows that the Total Value Locked (TVL) at Cardano has been rising. TVL represents the total amount of money tied up in staked crypto assets like smart contracts and deposits with yield and staking apps. It is now at $257 million, up from $114 million at the end of February.
However, Cardano’s TVL is still down from its recent peak at $326 million as of Mar. 26. Fears of an impending recession, the notion that the war in Ukraine has no end in sight, and higher oil prices are all weighing it down. This is known in the cryptocurrency market as a FUD factor, which stands for fear, uncertainty, and doubt.
Nevertheless, Tech Crunch points out that TVL for crypto assets is up 3x over last year. For example, DefiLlama shows that at the beginning of this year, Cardano had just over $1 million in staked assets. Cardano implemented the Alanzo fork in Sep. 2021 when smart contracts began on its platform. Now, it is up to $257 million.
Tech Crunch says the latest TVL decline is simply a “bump” in the long-term growth of cryptos like Cardano. As a result, investors in Cardano might expect to see a higher price later this year as staked contracts and TVL levels continue to rise.
On the date of publication, Mark Hake did not hold (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.
