Cardano is a Layer 1 blockchain platform that was conceived to be more flexible, scalable, and sustainable than Ethereum.
Founded in 2017 by Ethereum co-founder Charles Hoskinson, Cardano places a focus on academic research and peer reviews to advance its development.
The Cardano blockchain is powered by Ouroboros, the platform’s energy-efficient Proof of Stake (PoS) consensus. Block validators stake the native ADA cryptocurrency for the chance to validate a block and earn rewards, while blockchain users and developers also pay network transaction fees in the ADA currency.
The maximum supply of ADA token is set at 45 billion. Just over half of these were released at the token's initial coin offering in 2016, while the total ADA in circulation stands at just over 35 billion in 2024. The remainder are locked in reserve and released at a maximum rate of 0.3% per epoch, which equates to roughly five days.
Similarly to Bitcoin, the rate of release is scheduled to decline over time. However, it’s anticipated that over 99% of ADA will be in circulation by 2050.
Cardano (ADA) Price Charts
Increased demand for block space on Cardano drives demand for ADA, the platform's native currency, directly impacting its price. Staking demand is another significant factor, since anywhere between half and two-thirds of the total ADA supply are typically locked into the protocol’s Ouroboros PoS consensus.
Factors such as roadmap developments, endorsements by projects building on Cardano, leadership appointments, or protocol changes may also influence the price of ADA.
Some traders also use technical analysis to seek indicators of future price changes in historical price patterns.
Like many altcoins, the longer-term movements of ADA prices often reflect the volatility in the broader cryptocurrency markets, providing an additional basis for comparison using technical indicators.
ADA Price and its History
ADA began trading in late 2017, around the same time as Bitcoin was approaching its bull market high. Similar to the general hype around cryptocurrencies at the time, Cardano attracted a significant amount of attention due to its founder, Charles Hoskinson, and his renown as a co-founder of Ethereum. For these reasons, the price of ADA spiked from an early trading price of around $0.02 to a high of nearly $1 in January 2018.
However, Cardano has been engaged in a long-term roadmap, so once the initial token launch hype subsided, the broader bear market in crypto took hold. ADA failed to deliver any significant price movements until early 2021. Although this was a time when the rest of the market was also in a bull market, Cardano managed to deliver outsize returns thanks to the launch of its Alonzo hard fork, which brought long-awaited smart contract capabilities to the platform. Over 2021, ADA would go on to achieve new highs above $2 in May, and even $3.10 per token in September.
Like 2018, ADA lost value shortly afterward as the project went back into development for the next stage of its roadmap. Since 2021, ADA hasn’t had any further significant price moves, although it did benefit from the bullish sentiments that swept the market in early 2024 following the approval of Bitcoin ETFs by the US SEC. At this time, ADA reached a yearly high above $0.75.
However, this is a comparable performance to other similarly-ranked platform cryptocurrencies like Polkadot’s DOT, indicating that broader market forces were more of a factor than any individual driver of ADA price.
Cardano is currently developing the fifth and final phase of its roadmap, dubbed Voltaire. Therefore, there is a chance that future developments in the roadmap could further impact the price of ADA.
Even while Cardano remains under development, ADA has performed well over the years since it launched, consistently ranking in or close to the top ten cryptocurrencies by market cap. However, whether it retains this position will depend on Cardano’s ability to continue competing as a development platform in an increasingly crowded sector of Layer 1 and Layer 2 blockchains.
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Conclusion
- Cardano is a Layer 1 proof of stake blockchain using ADA as its native cryptocurrency.
- Staking and payment of transaction fees are the main use cases driving demand for ADA.
- Since trading began in 2017, ADA prices peaked at $3.10 in 2021 following the successful launch of smart contract functionality. However, prices have largely performed in line with the broader crypto markets since the high.