- Cardano’s native stablecoins made significant contributions to its TVL.
- Cardano network activity slows down, influencing ADA demand.
What are the factors that have been driving Cardano’s growth? Recent research revealed that the network’s TVL grew by 199% in the first half of 2023. It also suggested that stablecoins have been behind this growth.
Read Cardano’s [ADA] Price Prediction 2023-24
It is not just any stablecoins that contributed to Cardano’s TVL growth. The latest data suggests that the TVL embarked on its rally after the launch of the DJED and iUSD stablecoins. Interestingly, ADA’s TVL has been steadily growing since then and it just reached a 12-month high.
Cardano’s TVL (USD) was up 199% in the first half of 2023. Even more impressive in light of ADA’s 27% price decline in Q2
TVL dominance is shifting towards newer protocols, and there are a LOT of new protocols pic.twitter.com/qWNCQ0EBti
— Red (@redvelvetzip) August 10, 2023
The fact that the launch of those two stablecoins pegged to the U.S. dollar triggered TVL growth is not surprising. This is because incentives around the two stablecoins encouraged the use of ADA as collateral. For example, DJED is minted when ADA is added to the smart contract reserve pool while iUSD is minted when ADA is added to a CDP.
The incentive here is that ADA holders that bought the token at discounted prices could use their holdings to access the aforementioned stablecoins. They could then use those stablecoins for other purposes within the Cardano ecosystem.
Cardano TVL maintained its steady upside in the last few months. It recently peaked at 601.92 million coins. This represented roughly $179.59 million at present market value.
Source: DeFiLlama
Cardano’s metrics reveal this about its performance
We explored Cardano’s on-chain metrics and here’s what we found. The blockchain network’s development activity has been on the rise for the last 30 days. Healthy development activity usually goes hand in hand with boosting investor sentiment. Interestingly, Cardano’s weighted sentiment has also been rising in the last four weeks.
Source: Santiment
The surge in weighted sentiment confirmed that many analysts anticipate a bullish outcome. However, ADA’s price action has been moving in the opposite direction judging by the selling pressure we observed since mid-July.
How much are 1,10,100 ADAs worth today?
ADA exchanged hands at $0.29 at press time. It struggled to push back above the 5-day moving average due to low momentum. ADA’s price remains relatively subdued and with barely any interesting findings on its price chart. This reflected the low volume that prevailed in the last three weeks or so.
Source: Santiment
The low volume also aligned with the declining network activity. The number of daily active addresses has been waning in the last 30 days. In other words, the lack of excitement in the market underscores the low demand for ADA.
