This guide comparing the cryptocurrencies will highlight all the critical differences between Ethereum vs Cardano and to find out if Ethereum or Cardano are worth investing in and which out of the two is the best investment for you.
The financial world received a shake-up in 2020 and many prominent industry experts were surprised by just how well the cryptocurrency market weathered the COVID storm. In fact, as faith in traditional economies was rocked, many investment funds and large-scale corporations found themselves looking to invest in Ethereum, Bitcoin, Cardano, and suchlike, to hedge against future uncertainty.
This shift did not go unnoticed by individual investors and a renewed appetite for digital currency saw bull runs for all the major tokens, as more and more people chose to invest in cryptocurrency in 2021.
Whilst Bitcoin has been a go-to choice for several years, many forward-thinking traders have also chosen to invest in the leading altcoins. Two of the most notable being Ethereum and Cardano. But should you invest in Ethereum or buy Cardano in 2021? We’ve put together the following comparison to see how each token measures up against one another, as well as how they slot into the wider crypto market.
Cardano vs Ethereum: A Comparison Between ETH and ADA
Anyone looking to invest in cryptocurrency in 2021 may have already earmarked Ethereum and/or Cardano for inclusion in their portfolio and both tokens have great potential. But is one a better option than the other?
Before we get into any price analyses, it’s important to understand the key differences between the two cryptocurrencies. If we want to accurately compare Ethereum vs Cardano, then we need to know in which ways they are effectively competing and in which ways offer something completely different from one another.
Cardano Vs Ethereum: What Are The Key Differences Between Them
Here are the most important ways the two assets differ:
Ethereum is arguably the second most famous cryptocurrency behind Bitcoin. Heralding the first wave of second-generation cryptocurrencies, the Ethereum blockchain went beyond offering a simple payment system and presented far more functionality than the original cryptocurrencies and their respective blockchains.
Launched in July 2015, Ethereum is driven by its native crypto token, Ether, but also allows the exchange of smart contracts, intended to streamline the transfer ownership assets and trust agreements. The Ethereum platform also allows ÄApps to be developed and run without any third-party influence and its proprietary programming language opens up a world of further possibilities.
The recipe seems to have proved a success so far and Ethereum is the second-biggest cryptocurrency in terms of market capitalisation. As such, the decision to buy Ethereum in 2021 isn’t as risky as it might be with a less established altcoin.
Cardano was developed in 2015 with a very similar objective to Ethereum - that is to offer a platform that would not only allow the sending and receiving of a native cryptocurrency, but would also facilitate smart contracts and the development of distributed apps.
The similarities between Cardano and Ethereum are no coincidence either. Cardano was actually developed by ex-Ethereum co-founder Charles Hoskinson. However, under the surface, Cardano has several notable advancements on the Ethereum blockchain.
Cardano is the world’s first peer-reviewed cryptocurrency, having been scrutinised by several prominent academic institutions. It also has a unique two-layer architecture, one for handling general transactions and the other dealing with smart contracts.
Of course, this is all very impressive on paper - but does it make it a good idea to buy Cordano in 2021? Well, ADA has consistently been in the top 5 - 6 cryptocurrencies by market cap (currently around $27.5 billion) so, once again, it is one of the safer bets in the crypto sphere.
Transactions and Speed
Aside from its virtually limitless potential, another of Ethereum’s standout qualities is its fast block creation times. The Bitcoin blockchain takes up to 10 minutes to add new blocks, whereas Ethereum has an expected creation time of between 10 and 20 seconds. But is this reason enough to buy Ethereum in 2021?
At the time of writing, Ethereum is still using the proof of work concept. This involves computers on the network effectively competing against each other to solve equations in exchange for a reward of around 2 ETH. In this sense, Ethereum is similar to many first-generation cryptocurrencies, save for the fact it relies on the ethash mining algorithm rather than the SHA-256 algorithm utilised by Bitcoin.
You can find more information on the proof of work concept in our explanation of crypto mining, but anyone looking to invest in Ethereum should note that the network is in the process of shifting over to a proof of stake consensus mechanism - which is expected to boost both efficiency and security.
This is part of the Ethereum 2.0 network upgrade and, whilst a timeline for the completion of the switch is yet to be finalised, it could have a significant impact upon the price of Ether.
Ethereum significantly improved upon the transaction speeds of Bitcoin, but at an estimated 15-20 transactions per second (TPS), this still pales in comparison to Cardano, which has been tested to at least 257 TPS.
Cardano’s speed is already fairly impressive, but with the Hydra 2 scaling solution implemented over the existing proof of stake protocol, Charles Hoskinson, CEO of IOHK, the company responsible for the development of Cardano (ADA), claims that simulations show the network is capable of processing over one million transactions per second.
The impressive performance is of course made possible by the two-layer system and could well be reason enough to buy Cardano in 2021, however, investors should remember that the one million-plus TPS touted by Hoskinson are yet to actually be realised.
Supply and Demand
A key concern for anyone looking to invest in Ethereum - or any other cryptocurrency - will always be how supply is managed. After all, any digital currency can be generated on a network and is not tied to any physical asset, so in order to hold value, there must be a protocol to foster scarcity of some kind.
There is currently a total cap for the total amount of Ether, as there is with Bitcoin. However, as per its initial principles, there is a limit on how many tokens are released into the Ethereum ecosystem per year.
Ethereum developers have previously mooted the idea of setting a cap on the number of tokens available, but investors should note that Ethereum has different objectives than other cryptocurrencies, such as Bitcoin. Ethereum is intended as a platform for decentralised services and, as such, there is much speculation as to whether a cap would help or hinder success in this area.
Just as with Ethereum, anyone looking to invest in Cardano will probably have questions about the supply of the ADA token.
Cardano differs from Ethereum in that it has a total supply cap, much in the same way Bitcoin does. At the time of writing, the supply limit was 45,000,000,000. What’s more, Cardano also has declining stake reward, which acts as an in-built deflationary mechanism and increases potential scarcity, which can of course have a positive effect on trading prices.
From the demand side of things, those thinking to invest in Cardano should be aware that ADA is not currently traded in Coinbase - one of the largest crypto exchanges - and the token was not in the first selection of cryptocurrencies supported by Paypal.
Ethereum vs Cardano: Should you invest in Cardano or Ethereum?
Choosing whether to invest in Ethereum or buy Cardano in 2021 will inevitably depend on your investment goals. Of course, there's no reason to choose one over the other, but for the sake of comparing Cardano vs Ethereum there are a few key metrics and indicators we can use to differentiate between the two with regards to investment opportunity.
First and foremost, cryptocurrency price forecasts are usually based on technical analysis of historic price movement. Having reviewed this, we can then see the predictions made by some of the leading platforms in the industry. Finally, expert insights can be a great way of garnering further information and gauging mainstream appetite for a particular cryptocurrency.
Ethereum Vs Cardano: Price History
When looking at the price history of Ethereum vs Cardano, we see two very different pictures. Previous price movement can’t exactly tell us which cryptocurrency to invest in 2021, but it can give us a chance to form more realistic expectation of each coin’s potential.
There wasn’t much to write home about with regards to Ethereum’s price movement in the first year or two of its existence. Prices saw very few significant increases until January 2017, when Ether was trading at around the $10 mark.
As with Bitcoin in its early days, there was something of a delay before the potential of Ethereum started to get noticed. However by January 2018 ETH had soared to a record high of almost $1,400. But Things were less than stable for ETH over the next few months and at one point prices dropped back down to $85.
Suffice to say, things continued to bounce around for Ethereum and the altcoin struggled against a barrier of $250 for well over a year. However, things picked up for ETH in 2020 and at the time of writing it looks as though it has ridden the COVID storm well, having hit a new high of $1,773.33.
If you’re looking to invest in Cardano then you may already be aware that its price trajectory is somewhat different than many other altcoins.
ADA very quickly reached parity with the US dollar during the first few months of its trading lifecycle and its all-time high of $1.18 was reached in January 2018. However, the surge was short-lived and Cardano quickly plummeted to less than $0.10 per token - finishing the year at around $0.03.
Cardano stayed subdued and did not peak above $0.10 until the summer of 2020 - shortly after the COVID pandemic had struck. ADA then seemed to turn a corner at the end of the year, as there was a rush to invest in Cardano. Prices soared by over 500% until reaching $0.92 by the end of January 2021.
Ethereum Vs Cardano: Future Price Predictions
As we have seen, there is little comparison when it comes to Ethereum vs Cardano on previous price movement. But how do their respective histories relate to future predictions? Here we will take a look at the forecasts of some top crypto analysts.
Based on its technical analysis, DigitalCoin is predicting steady growth for ETH in the year ahead, amid a renewed interest from those looking to invest in Ethereum. The platform believes that Ethereum will hold on to its impressive price run and trade well above its previous record for the rest of 2021, ending the year at an impressive $2,726.19.
TradingBeasts is also optimistic about ETH’s potential, although with a more subdued forecast. The platform believes that Ethereum will maintain a high price throughout the year, but will close 2021 slightly under its current trading price ($1,773.33.) finishing at around $1,624.
Finally, WalletInvestor falls somewhere between the two predictions detailed above. The platform is predicting fairly linear growth for ETH but has the token closing the year at around $2,100.
Naturally, these forecasts will be music to the ears of anyone who has thought to invest in Ethereum - but always remember that predictions are effectively informed guesswork and are by no means guaranteed.
Read More: Ethereum Price Prediction
Anyone looking to buy Cardano in 2021 can hardly expect the same numbers as seen with the price of ETH, but several platforms are predicting substantial growth. WalletInvestor has ADA prices increasing by approximately 50% throughout 2021, increasing steadily over the summer and closing December at around $1.46.
TradingBeasts are also forecasting steady appreciation for Cardano throughout 2021. The platform has the token maintaining its recent price before following a steady upwards gradient, finishing the year around 20% up on its current price, at around $1.07.
The price per token might not be anything to write home about, but anyone looking to invest in Cardano should remember it’s all about growth and returns of 20% to 50% would mark a very successful addition to your portfolio.
Cardano Vs Ethereum: What the Experts Say
The opinions of significant finance industry experts can tell us a great deal about investor appetite for a particular cryptocurrency and in some instances can even be enough to drive prices up in themselves.
Anyone looking to invest in Ethereum in the coming months won’t have to look far to find support from key commentators. For example, Messari CEO Ryan Selkis has recently said that, whilst Bitcoin’s performance has been impressive, “it’s Ethereum that has taken flight as crypto’s most important platform… one that could power an entirely new financial system, and a more open, resilient internet.”
Elsewhere Simon Dedic, co-founder of Blockfyre and managing partner at Moonrock Capital, has predicted that Ethereum will eventually hit a staggering $9,000 per token.
There are fewer clear-cut predictions for Cardano, but Altcoin Daily host and crypto trader Austin Arnold has voiced his support latest Goguen Mary update, citing it as “a big reason that the Cardano price is rising this month [February]”
Read More: Cardano Price Prediction
Cardano Vs Ethereum: Conclusion
So is Cardano a better investment than Ethereum?
It’s difficult to decide an outright winner when looking at Cardano vs Ethereum as an investment potential. Whilst Ethereum is far more established and with a much higher price, history shows us that it isn’t immune to sudden price drops.
Those looking to invest in Cardano are also able to get a much larger holding - with tokens currently trading at less than a single US dollar. Ultimately, investment growth is measured in percentage and both coins are predicted to perform well throughout 2021.
Whether you choose to invest in Cardano or buy Ethereum in 2021, it’s important to manage your expectations. Both coins have experienced sudden, sustained price drops and the cryptocurrency market is notoriously volatile - even though it is currently going from strength to strength, there are no guarantees this will last.
In the end, the final decision comes down to you. What kind of investor do you want to be? Which technology excites you more? And which is currently the most undervalued?
Figure out the answer to that question, you’ll definitely know if Cardano is a better investment than Ethereum!
How to Invest in Cardano and Ethereum
Assuming you are approaching the cryptocurrency market with realistic expectations and a solid investment strategy, then it could well prove to be profitable to invest in Ethereum or buy Cardano in 2021.
If you don’t already have a trading account, you’ll need to find a reliable broker. We recommend eToro, as it is one of the most established names on the market and offers plenty of tools for both novice and more experienced traders.
However, you measure up Ethereum vs Cardano, using a platform with plenty of analytical tools like eToro will allow you to keep your finger on the pulse and react to price movements in real-time.
Now you know the critical differences between Cardano and Ethereum. If you're feeling inspired to buy ADA or ETH, or this article has provided some extra insight to your existing investing knowledge, you may be pleased to know that eToro provides the ability to buy Crypto assets and trade CFDs on up to 90+ cryptocurrencies.
eToro – Top Cryptocurrency Platform
eToro have proven themselves trustworthy within the Crypto industry over many years – we recommend you try them out.
Virtual currencies are highly volatile. Your capital is at risk.
Ethereum vs Cardano - FAQ
How do I choose between Ethereum vs Cardano?
Many would-be investors start out by comparing cryptocurrencies to decide which ones best fit their portfolio objectives. However, comparing Ethereum vs Cardano risks overlooking one for the other, when in actual fact they both present plenty of opportunity as part of a diversified portfolio. Whereas Ethereum may be the more established of the two, a much larger holding of Cardano can be obtained for a relatively small outlay.
Where can I buy Cardano in 2021?
Cardano is regularly amongst the top cryptocurrencies in terms of market capitalisation, yet there are some exchanges - including Coinbase - which are not listing the token. If you’re looking to buy Cardano in 2021, then we’d recommend using eToro. The platform doesn’t exclude any of the major tokens and allows quick and easy access to the markets.
Cardano vs Ethereum - which is the better investment?
Both Cardano and Ethereum present promising investment opportunities in 2021. Analysts vary on exact price movement, but most agree that ADA and ETH will appreciate over the coming years.
What are the top cryptocurrencies to invest in in 2021?
Choosing to invest in cryptocurrency in 2021 could prove to be a very smart move, as the market is expected to grow exponentially. However, the outlook for some coins is better than others. Coins like Bitcoin, Ethereum, Cardano and Litecoin are comparatively ‘safe bets’ whilst any coins outside of the top 10 in terms of market cap carry considerably more risk. As such, they should only be included as part of a diversified portfolio.