Is Cardano Worth Investing?

Is It Worth Investing in Cardano ADA?

20 Min Read
Last Updated July 23rd 2021

Cardano is one of those cryptocurrencies that have been invariably hailed as Ethereum killers. Although it was only launched recently in 2017, ADA is no stranger to achieving new milestones. The coin has grown from an under-the-radar position to overtaking big players like Ripple and Litecoin. 

In fact, Cardano only took about three years to become the 10th largest cryptocurrency by market cap. The platform also came into the limelight and attracted plenty of media attention for being the first blockchain to incorporate peer-reviewed research into its core principles.

Now, it is one of the top and most popular cryptocurrencies currently trading at $1.35 with a market cap of 43.29 billion, according to data from CoinDesk. This is a major improvement considering that just a few months back in November 2020, Cardano’s market cap stood slightly above $3 billion with a price of around  $0.107. 

Most price analysts didn’t even think ADA would reach $1 by 2022. But what exactly is Cardano, and why is it different? Is it a good investment? Will Cardano really replace Ethereum? 

In this guide, we are not only going to show you how to invest in Cardano but also discuss whether it is a good investment for you in the long run. 

If you want to invest in Cardano quickly and easily, with 0% commission, check out eToro Exchange!

Contents:

What Is Cardano?

what is cardano

Cardano is a bit different from most of the other cryptocurrencies since it uses a proof-of-stake system instead of the more popular proof-of-work system. As a PoS blockchain platform, users on Cardano can validate new transactions by ‘staking’ their coins as collateral. 

This is different and a bit much less painless compared to PoW blockchain like Bitcoin, where miners use power-intensive computer hardware to solve complex mathematical equations to validate new transactions. 

Cardano’s native cryptocurrency is known as ADA, although you will find most people referring to it simply as Cardano. So, in a nutshell, Cardano is a platform, and ADA is the cryptocurrency that runs on it. 

How Does Cardano Work?

Although it uses a PoS system, Cardano is also an open-source blockchain platform like most of the other major cryptocurrencies.

As a third-generation cryptocurrency, Cardano generally improves on the shortcomings of Bitcoin and Ethereum. It does this by utilizing what is known as a layered architecture to bolster three important aspects of cryptocurrency: security, scalability, and sustainability. 

 In this regard, Cardano is based on two distinct layers. These are: 

  • The Cardano Settlement Layer (CSL), popularly known as the cryptocurrency layer
  • The Cardano Computation Layer (CCL)

The first layer is where users can perform cryptocurrency transactions such as buying or selling Cardano. 

The second layer is a bit technical and is where developers can run their own decentralized apps (dApps) and smart contracts. This unique architecture has enabled Cardano to stand out, especially when compared to the first and second-generation cryptocurrencies. 

The two layers pave the room for a more effective long-term scalability and also make it easier to perform any hard forks in the future. 

Cardano Price History

Cardano was launched at a time when the cryptocurrency market was undergoing one of the most dramatic bull runs. This was in late 2017 and early 2018. As a result, investors picked up ADA fairly fast. 

In fact, a few months after it was launched, ADA experienced one of its first price surges. This was between 20th November 2017 and 1st January 2018 when the price jumped from $0.029892 to $0.970563. 

This got many investors excited, and soon Cardano was overtaking earlier cryptocurrencies and making headlines. However, given that the cryptocurrency had only been alive for less than a year, it could not sustain this sudden parabolic growth. 

As a result, the subsequent price drop got many hopeful investors disappointed, and by 15th February 2018, ADA was trading at $0.351552. Of course, this put many investors off, which means the bearish trend would be experienced for the rest of the year. 

There was, however, a sharp spike in May 2018 before the coin resumed the bearish momentum that saw it close the year at around $0.029341. This was, literally, back to the drawing board for Cardano and its investors. 

Although it had a hard time reaching $0.1 again, the price recovered slightly in 2019. In 2020, just as investors were beginning to get their hopes high again, Cardano was caught up in a market-wide crash resulting from the COVID-19 pandemic. This saw the price plummet from $0.065333 to $0.027386 between 10th February and 16th March 2020. Cardano had not gone this low since December 20218, so most investors lost confidence, and the coin went under the radar again. 

Fortunately, the coronavirus crash didn’t last long for most cryptocurrencies. Cardano was one of them. Soon, the crypto attained and even exceeded its pre-COVID price, and in July 2020, it finally went back to $0.1. 

ADA remained relatively stable in this position until early September when it dropped back to $0.08 for a short period before going back to $0.1 towards the end of the month. 

Soon, Cardano joined the market-wide bull run that started in late 2020. The price quickly rose to reach $0.3 in mid-January 2021. It stayed slightly above $0.3 until the end of January. 

In February 2021, Cardano had one of its biggest price surges. Between February 1st and February 28th, 2021, ADA rose from $0.346384 to $1.35!

A series of drops and rises followed then in Mid-April 2021, it reached its current all-time high of $1.56. It then had a sharp drop to $1.08 on April 26th, then quickly rose again and is currently trading at around $1.35, according to data from CoinDesk. 

Read Also: Why Cardano Is So Cheap?

Cardano Price Prediction for 2021

As we mentioned, Cardano started 2021 on a highly bullish note. So far, it has not gone below $1 this year and might be on a rally to the $2 mark by the end of the year. 

But as is the case with most cryptocurrencies, we will be seeing some degree of volatility, and ADA might even end the year at a lower price than we expect. There have already been several predictions from experts, and most of them seem to paint a positive outlook. 

Of course, the predictions vary, but generally, we get the idea that Cardano might break new records and reach new milestones this year. These predictions will help you decide whether Cardano is a worthy investment this year and if you should consider adding it to your portfolio. 

Most price analysts believe that Cardano is set for a bright future. For Instance, Italian analyst Previsioni Bitcoin believes that Cardano will be worth $5.14 by July this year. This seems like an overly bullish prediction, given that most of the conservative forecasts are going for $2 by the end of the year. 

Previsioni Bitcoin is, of course, known for its bullish predictions, some of which come true. If Cardano were to hit that price by the next few months, it would be worth around five times its current ATH. The Forecast does not stop there. 

According to Previsioni Bitcoin, Cardano ADA will continue rising steadily for the rest of the year to reach around $6.84 by December 2020. 

Of course, the other price analysis sites are also hopeful that Cardano will be on an uptrend this year. However, most don’t seem to align with Previsioni Bitcoin’s highly bullish predictions. 

For instance, both Long Forecast and Wallet Investor believe that Cardano will finish 2021 at slightly above $2. Long Forecast predicts a slight drop in May and June, then a steady rise to close the year at around $2.31. Wallet Investor is more hopeful throughout the year, although it closes slightly below Long Forecast at $2.115 by December 2021. 

Coin Price Forecast is a tad more bullish than the two and predicts Cardano will be worth around $3.68 by the end of the year. This is roughly a 174% increase from the current price. 

Recently, Investing Cube declared that Cardano is ripe for a bullish breakout and might reach about $1.4080 in the next few days. 

Although Digital Coin Price is equally bullish about the future of ADA, it doesn’t think the coin will reach $2 by the end of 2021. This is close to what Long Forecast and Wallet Investor predict, so, generally, we will be seeing a hopefully rally to above $2 by the end of the year. 

While most of these price forecasts might be wrong about the numbers, the trajectory is correct, judging by Cardano’s recent growth. So, if you were unsure whether ADA would make a good investment this year, these predictions should change your mind. 

Don't Miss: Cardano Price Prediction 2021-2024

Different Ways to Invest in Cardano

There is usually more than one way to invest in cryptocurrencies. Apart from then standard trading or hodling, you can also invest in Cardano through the dApps that are developed on its infrastructure. 

We will shortly be going through each of these methods and show you how you can use each to maximize your investment. However, before investing, especially if you intend to trade or hold for the long term, you will need to buy some Cardano first.

ADA is listed on major exchanges such as Binance, eToro, and Coinbase. You can easily buy it through any of these exchanges and start investing. 

Now, let’s go through the different methods you can utilize to invest in Cardano. 

Method 1: Trade Cardano 

Trading is one of the most popular ways to invest in cryptocurrency. You’ll need to be skilled and understand the market to effectively trade ADA. This is the best way to go if you are looking to make quick profits by taking advantage of short-term price movements. 

Now, if you are going to trade, we recommend doing so on eToro. This is our favourite exchange if you are looking to buy ADA for speculative reasons. That is, buying low and selling high. 

What we like about eToro is that it has low fees with a variety of payment options such as credit card, bank transfer, and PayPal. 

Of course, you are free to use any other exchange if you don’t think eToro is the best option for you. 

Otherwise, here is how to easily buy ADA on eToro with fiat currency. 

  • Visit eToro and sign up for an account.
  • Follow the steps to verify your account. This is for security purposes
  • Complete your profile: After verifying through email address, you will be required to provide additional personal information before you can start trading. This enables eToro to comply with AML and CTF regulations. 
  • Fund your eToro account: Before you can start trading Cardano, you will need to deposit some funds into your eToro account. eToro allows a minimum deposit of $200 or its equivalent in other currencies. 
  • Start trading: To start trading, navigate to ‘Trade Markets’ and then choose “Crypto.” 
  • From the list of cryptocurrencies, choose ADA, then click BUY
  • Choose ‘Trade’ if you wish to buy at the current best market price or ‘Order’ if you want to specify the price at which you want to buy. If you are not sure what to do, just leave this parameter on ‘Trade’. 
  • Provide the amount you wish to spend on ADA. 

Below the amount, there are some optional parameters that you can tweak to make your trade more effective and reduce risks. These include “Stop Loss”, which allows you to specify the maximum loss you are willing to take. Your ADA is automatically sold if the price falls to your Stop loss. 

There is also the ‘Take Profit’ option which allows you to set a price at which your Cardano coins should be automatically sold to make a profit.

We recommend setting the ‘Leverage’ option at X1 to avoid amplifying your losses further.  After setting up everything, click on ‘Open Trade’ to start trading your ADA. 

You can monitor your trade by navigating to the ‘Portfolio’ section, where you can see the amount of ADA you have and if your trade is currently profitable or not. 

Method 2: HODL Cardano 

Hodling is a popular investment strategy for people who don’t have the right skills or time to trade. This where you buy Cardano and store it in a wallet for years. The plan is to wait until the price of ADA is way higher than the purchase price, or for the more hardcore hodlers, until Cardano sees full mainstream adoption. 

If you plan on hodling, you might want to use a different exchange from eToro. This is because withdrawing the coins to your wallet from eToro is a bit complicated. eToro makes it easier to withdraw fiat currencies ( that’s why we recommend it for trading) than the crypto itself. 

So, to buy and hold, you will need to go with a different exchange such as Binance, Coinmama, or Coinbase. The process of buying and transferring Cardano to a wallet from these exchanges is not much different. 

For holding, we recommend storing your coins off the exchange. That is, you will need to transfer the coins to your own wallet instead of storing them in your exchange account.

So, let’s start with how to get a wallet. 

How to Get a Cardano Wallet

Since Cardano is still a relatively young project, there are not many wallets that support its native currency, ADA. However, you can still get some pretty dependable options. 

Generally, Cardano wallets can be categorized as hardware or software wallets. 

Hardware wallets are the more secure solutions, especially if you plan on holding your ADA for a long time. This is because they are offline-based (also called cold wallets) and, therefore, not vulnerable to hacking like online-based wallets (hot wallets). 

The best hardware wallets for ADA include Ledger, Trezor, and Nano X.

If you are looking to store your ADA alongside other cryptocurrencies, we recommend using a software wallet. These wallets can easily be downloaded to your smartphone or desktop. 

In this case, we recommend wallets such as: 

  • Exodus - Free and supports both mobile and desktop versions
  • Atomic - You can store your ADA alongside 300 other cryptocurrencies. 
  • Daedalus - The official ADA desktop wallet, available for both Windows and Mac. 

After getting your wallet, it’s now time to buy some Cardano. 

How to Buy Cardano 

There are many exchanges from which you can buy Cardano. However, most of these exchanges may not allow you to buy Cardano directly using fiat currency. 

For instance, on Binance, you will need to first buy some Bitcoin then exchange it for an equivalent amount of Cardano. 

After buying Cardano, you will need to transfer it to your wallet as soon as possible. The process will vary depending on the exchange your use. However, it shouldn’t be too complicated. 

Exchanges that act as brokers, such as Coinmama, will instantly send the coins to your wallet instead of holding them in their account.

Some will hold your coins in their default wallets until you manually transfer the coins to your own off-exchange wallet. 

Check Out: Is Cardano a Good Buy?

Method 3: Invest in Cardano Startups 

The third way to invest in Cardano is to invest in startups or dApps developed on its platform. 

With this method, you won’t necessarily have to buy any Cardano or get a wallet in that matter. Cardano has grown to become one of the top dApp platforms. 

Currently, there is a growing demand for these dApps, and this can be a good investment opportunity. 

So, what you do here is invest in the applications or startups hosted on Cardano instead of the ADA itself. As Cardano grows, so will these apps. 

However, not all of these dApps have the potential to grow and become successful. You should, therefore, be careful when choosing which dApp you will want to invest in. 

Generally, a great dApp should be out to solve a real problem that people are facing. It should also be easy to use and understand and have a visionary team behind it. 

Investing in this way is a bit technical, and we only recommend it for veteran investors. Otherwise, you can still work with an expert or hire someone to invest on your behalf. 

Is Cardano a Good Investment in 2021?

Most price analysts are positive that the price of Cardano will increase in 2021. Going forward into 2022 and even beyond, we will be seeing a huge surge if the current trend holds. 

Based on what we have seen from the ADA predictions, current trend, and price history, it is safe to say that Cardano is a good investment in 2021. 

The coin has grown dramatically over the years and had an even bigger growth in 2021. While most of the other cryptocurrencies seem to be dropping after the recent market-wide bull run, ADA has stabilized and only growing higher. 

However, Cardano, like any other cryptocurrency, is still volatile, and the price may move against our expectations. So, when you invest, you should be ready for some risks along the way. 

Ultimately, Cardano’s profitability may vary depending on your investment strategy. That is, whether you trade for the short-term, hodl or invest in Cardano-based dApps. 

Generally, experts believe that Cardano is a low-risk investment with the potential for great rewards. However, before you start investing, making sure to do some research to make a more educated decision. 

Why Should I Invest in Cardano?

There are a few good reasons why you might want to consider adding Cardano to your portfolio. For once, Cardano is trying to solve some real issues that were overlooked by both the first and second-generation cryptocurrencies. 

These include the issues of scalability, sustainability, and security. Cardano solves these issues by using a proof-of-stake system and a layered architecture. 

Also, unlike Ethereum, which has an unlimited supply, ADA is capped at 45 billion coins. This limit will bring about scarcity that skyrockets Cardano’s value and demand over the years. 

So, if you invest now, your investment will grow more valuable (especially if you are hodling) as the supply of ADA reduces. 

Another reason to invest in Cardano is the growing number of decentralized apps on its platform. Demand for dApps is growing, and Cardano being at the forefront of decentralized finance will no doubt take center stage when these dApps see mainstream adoption. 

Read More: Is Cardano a Good Investment?

Conclusion: So, Should I Invest in Cardano?

Cardano is undoubtedly one of the most promising cryptocurrencies today. The project has strong fundamentals with a rapidly growing community. And while many people refer to it as an Ethereum-killer, Cardano has managed to carve out its own path and is on the road to parallel the top coins in the market. 

In this case, it will unlikely flip Ethereum. 

We have already provided several reasons as to why we think Cardano will make for a great investment in 2021. From scalability, security to the fact that this is one of the fastest-growing coins, there is little doubt that right now would be the perfect time to invest in Cardano. 

Again, remember that cryptocurrency investing is risky due to the high volatility levels. So, remember to do your own research, work with an expert, choosing the best-investing strategy for you and never invest more than you can afford to lose.

eToro – Best Platform to Buy Cardano 

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How to Invest in Cardano Cardano - FAQs

Here are some common questions we get asked when it comes to investing in Cardano. 

What will Cardano be worth in 5 years?

According to predictions from several price analysts, Cardano will be worth between $5.8 to $15 in 5 years. However, being a long-term prediction, we can’t say for sure that these forecasts are final. 

Can Cardano reach $2 in 2021?

Most price forecasts believe that Cardano may reach $2 by the end of 2021 or early 2022. 

Can Cardano reach $10? 

Yes, Cardano can reach $10, but it will take some time. Probably, we might not see this milestone achieved in the next two or three years. However, we can expect ADA to reach $10 by 2025 or beyond. 

Is Cardano better than Ethereum?

While Cardano is still far behind Ethereum, some experts believe that it might provide a better solution. Cardano was specifically created to address the mistakes that Ethereum and Bitcoin overlooked, such as scalability. 

Its dual-layer architecture gives it a superior technology than Ethereum, while its proof-of-stake algorithm makes it more scalable. However, both Ethereum and Cardano have their own pros and cons, and it is hard to say with certainty which is the better option. 

Read More: Ethereum vs Cardano: Which Crypto Should You Buy

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