Some cryptocurrencies, especially those that were successful until the 2017 bubble, continue to show some unbelievable pumps. Cardano (ADA) is one such case, the meme coin of "peer-reviewed work."
Created in 2015 by former Ethereum founder Charles Hoskinson, it had its mainnet launched in September 2017. However, it took an incredible 4 years to launch programmable contracts, or smart contracts , albeit in a simple version. Thus, there are no decentralized finances (DeFi) on the Cardano network, only tokens, including NFTs.
How did Cardano fool so many people?
Charles, in addition to being intelligent, is extremely charismatic and egocentric, so it was not difficult to attract a legion of fans who noticed his fortune, and decided to bet on his story.
Cardano's initial offering (ICO ) raised more than $62 million between November 2015 and February 2017. 16.7% stayed with the founders and the project itself, while investors the other 83.3%.
To finance the validators needed by the Participation Proof system, Cardano dilutes the holders themselves through inflation, currently at 5.7%.
What caused the pump to go to $3.10?
On September 12, Cardano announced the Alonzo upgrade , which would supposedly bring smart contracts to life on the network. However, little by little people realized the hoax, as it was not possible to run DeFi or interoperability applications.
On November 23, a new blow occurred, with the eToro derivatives exchange removing the listing of Cardano and Tron (TRX) for US clients, citing regulatory risk.
Is it worth buying Cardano after the fall?
It is very difficult to evaluate meme coins, and Cardano is a fan token of Charles Hoskinson, figure with over 500,000 followers on social media, and videos that easily reach 60,000 views on Youtube.
Not every investor fell for Cardano's scam in the last 6 months, so many are still with an average price well below the current $1.55. Charles himself must have a lot of money still in Ethereum, and can use some of that for new pumps at Cardano.
Will Cardano go up when DeFi launches?
For sure. The hard part is knowing the right time to enter. For example, anyone who started buying 2 or 3 weeks before the Alonzo upgrade, hoping to sell at profit, lost 30% the week following the event.
Cardano is a completely flawed project, but with a huge legion of fanboys who believe in whatever nonsense their leader utters.
Another interesting aspect, which deceived even institutional investors, was the staking , or interest-bearing deposit. 70% of the currencies participate in the process, aiming to benefit from inflation. However, the magic disappears when the price starts to drop, and the people discover that the “gain” was fictitious.
About the author
Marcel Pechman worked as a trader for 18 years at UBS, Deutsche and Safra banks. In 2017, he became a cryptocurrency trader and analyst. Convinced maximalist, he also subscribes to the RadarBTC Youtube channel .
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