Despite growing enthusiasm for the Alonzo rigid fork, the ADA’s price has only gone negative since its launch.
Although Ethereum and Bitcoin have hit several historic highs (ATHs) over the past two months, Cardano hasn’t seen any new peaks since September. The launch of smart contracts didn’t seem to bring positivity and their market capitalization continues to fall.
Slow period for Cardano
On September 2, 2021, the ADA’s price peaked at over $3, and its market value nearly exceeded $100 billion. This was followed by a sharp drop on September 7th, along with the rest of the crypto market, when El Salvador’s Bitcoin law came in into force.
Less than a week later, Input Output, the team behind Cardano, confirmed the deployment of the Alonzo update. This brought smart contract compatibility to the network, using the Plutus framework. The ADA price saw a small bomb back to $2.71 in the aftermath, but it dipped below $2.50 the next day.
Things have been relatively pessimistic for Cardano since then. It failed to appreciate along with Bitcoin in October and steadily dropped to its lowest price in 90 days. Its market capitalization is now below $52 billion and it has lost its position as one of the top 5 cryptocurrencies (it currently ranks 6th).
Competition for Cardano
Although the CTO Romain Pellerin disapprove In comparison, Cardano and Ethereum were often seen as competitors by the crypto community earlier this year. Even Pellerin himself framed Cardano as a Blockchain that would be “on par with Ethereum” once smart contracts fall, with a much smaller carbon footprint than Ethereum or Bitcoin.
For this reason, Charles Hoskinson, founder of Cardano, even argued that Tesla should accept the ADA as a form of payment. In May, Elon Musk announced that his company would no longer accept Bitcoin payments due to environmental damage to cryptocurrency caused by mining. As a betting proof network, Cardano doesn’t require such strong energy consumption.
But while Cardano waited for smart contracts, another Blockchain competitor, Solana, saw parabolic growth throughout the year. Its proof-of-history consensus model has attracted immense investor interest and allows for a high volume of TPS and low power consumption and is now the fifth largest market capitalization of cryptocurrency.
Source: Crypto Potato