Is Cardano The Next Big Cryptocurrency?

by Trading 101     Jul 16, 2019

Bitcoin was the first big name cryptocurrency that shook the trading 101 world. With its seemingly overnight success, everyone was talking about it – from finance analysts to prominent businessmen to everyday people on social media. Of course, just as successful as its rise was, its decline was just as steep in the few weeks following December 2017.

However, there are more cryptocurrencies other than Bitcoin of course. Once you get past Bitcoin, there’s about a dozen other currencies vying for a spot in the top 3, with names such as Litecoin, Dash, Ethereum and Bitcoin Cash being prominent names on the forums and media. The 7th largest altcoin in terms of market cap in the crypto world is Cardano and it’s looking to set itself apart from its competition.

Cardano is not exactly the kind of topic covered in cryptocurrency trading 101 as it’s a bit different from the other common currencies. First is that Cardano operates on a larger level of complexity due to the way its governance and system is structured. This often makes it unattractive to inexperienced traders and investors, but more attractive to those that can see its value. Cardano’s whitepaper identifies the altcoin was a “third-gen” cryptocurrency, meaning it’s trying to fix problems that other cryptocurrencies encountered that haven’t been successfully addressed yet. It’s also a way to indicate that Cardano is trying to get into a problem-solving space that’s been plaguing the whole crypto industry.

A big factor to consider is potential. Cardano is at the time of writing not fully deployed. The system is still being developed, but many of its supporters are rather vocal in their belief that Cardano can be the next big cryptocurrency once it’s fully operational. Given that and the fact that it’s already the 7th largest cryptocurrency in market capital is significant.

Two of the targets in sight for the people behind this new player seem to be Ethereum and Ripple, both of which are ranked higher than Cardano. Ripple has risen in terms of popularity, especially since the power of blockchain is being understood by the mainstream market now. Ripple has been making waves with its high-speed cross-border digital payment solutions. Ripple can process over 5,000 transactions per second as it was built with scalability in mind, but Cardano has a different approach to the same topic that could set it apart from the leader.

The other target is Ethereum and its successful smart contracts. Ethereum is the undisputed leader in this space and Cardano looks like they want to knock on that door. Industry reports are saying that Ripple is looking to get into the smart contract space as well, so that might quickly devolve into a three-way competition between the three. The idea here is that the current setup by Ethereum isn’t as efficient and cost-effective as it could be. The question becomes not whether Cardano and Ripple can content Ethereum at all – they obviously can – but rather which currency becomes the most efficient and useable the quickest. By the time Cardano and Ripple advance enough to pose a challenge to Ethereum, there’s a chance that Ethereum will have already evolved new technologies to put them out of business again.

Given these, Cardano looks to be in strong position right now. With its fast and strong development team, there’s a high probability that Cardano can move up in the rankings within the year, especially if other currencies don’t develop as quickly to keep up with the novelty of the technology.

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