In the previous day, the price of Cardano has increased by 6%, rising to $0.404805 as the coin’s 24-hour trading volume exceeds $600 million. This is the most it has been in over two weeks, and ADA has increased by 8% in the last week and 59% in the past month.
This makes ADA one of the best-performing major cryptocurrencies on the market, and one of the main drivers of its recent growth has been the increased use of the DJED stablecoin, which is built on Cardano. Additionally, the development of DJED suggests that Cardano itself is becoming more and more useful, which raises the prospect that ADA might wind up being one of the top market winners this year.
Forecast for the price of Cardano when $600 million worth of trading volume pours in: Can ADA Reach $1?
The cryptocurrency appears to be in the midst of a significant surge, according to ADA’s indications. In the previous several weeks, its relative strength index (purple) shot up to 70 or above, and it is still there, indicating further upward momentum.
The coin’s 30-day moving average (red) is heading closer to crossing above its 200-day average, which is even more encouraging (blue). A “golden cross,” which may portend a greater breakthrough, would be formed if it crossed the longer-term average.
In other words, there’s a good potential that ADA might easily move from $0.404805 to $0.5 and beyond in the next days, exceeding its present level.
And right now, there are many causes to be positive about ADA and Cardano. The debut of the Djed (DJED) stablecoin, which is built on Cardano, has in particular resulted in a sharp increase in demand for ADA.
Djed is an over-collateralized stablecoin, which implies it needs more cryptocurrency backing than it is worth on paper. With 28.3 million ADA already lying in its reserves, ADA currently makes up a large portion of this support (and rising).
Given that the stablecoin is already listed on the Cardano-based DEXes MuesliSwap and Minswap, it goes without saying that Djed’s reserves will increase along with the stablecoin’s increasing demand. As a result, more ADA will be withdrawn off the market and placed in these reserves, lowering the amount of ADA in circulation and raising the price.
Given the sharp increase in ADA after the debut of Djed, the market is already observing this effect. Additionally, considering how Djed has been designed, the stablecoin is sure to win over a lot of new users.
In specifically, Djed will have an over-collateralization ratio of between 400% and 800% and is backed by a reserve of several cryptocurrencies. This configuration aims to shield Djed from many of the dangers mentioned by Terra, which notoriously collapsed last year.
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At the same time, Shen (SHEN), which serves primarily as one of its key reserve tokens, has been introduced together with Djed. It’s interesting to note that users will be required to pay a charge in ADA when either minting or burning SHEN (or DJED), which will eventually lead to a greater demand for ADA.
Upgrades for Cardano
It’s also important to note that Djed’s introduction ushers in a period in Cardano’s history during which it provides more usefulness to the cryptocurrency ecosystem and, as a result, experiences more acceptance. The network’s entire value locked in, for instance, increased from $48.95 million on January 1 to $97.05 million today, or by around 98%.
In other words, the value of the Cardano network has increased by double in the past month and is expected to continue to do so. This procedure will benefit from a significant improvement that Cardano has planned for this month, when it updates the Plutus smart contract language.
The next fork will, in essence, “enable ECDSA and Schnorr cryptographic signatures to make it easier for developers to construct cross-chain apps.” As a result, Cardano will be able to interact with other chains like Bitcoin and Ethereum to its advantage.
As a result, we may anticipate a significant expansion of the Cardano ecosystem. Thanks to cross-chain interoperability, dApps created for one chain can easily be modified to work on Cardano. With teams aware that their platforms would be exposed to a larger potential user base, this will encourage increased development over time.
Cardano’s ecosystem is already expanding steadily, with over 1,100 apps and projects now developing on its network in addition to over 110 projects that have previously been published. This also includes more than 5,500 Plutus scripts, which show that the network is really being used. Plutus scripts are Cardano’s equivalent of smart contracts.
The amount of Plutus scripts that are now executing will likely increase in light of this month’s release. These were only slightly over 3,200 at the beginning of September, thus the subsequent surge shows how rapidly Cardano is growing.
Given everything said above, aggressive medium- and long-term price estimates for ADA are acceptable. The record high for the alternative currency is $3.09, which was established in September 2021, when Cardano wasn’t even close to being effective or used as a network.
As a result, it seems extremely likely that ADA might return to $1 at some time in the upcoming several months, given the overall recovery of the larger cryptocurrency market.
Some analysts have placed the coin’s long-term aim at about $5.30 and its 2025 target at $2.45. Given that they are averages, these predictions may be considered cautious, and it is absolutely possible that ADA may grow much higher.
For instance, Cardano’s total locked value has actually only begun to increase. Its current market cap of $97.05 million, which is still barely 0.3% of Ethereum’s, shows how much further it needs to climb.
However, despite Cardano being relatively little at the moment, ADA is still the eighth-largest cryptocurrency by market valuation. ADA may likely advance much farther in the rankings if Cardano continues to see more usage and adoption.