Cardano Price Plunges To 2017 Levels After Crypto’s 5th Birthday

Cardano, the so-called “third-generation blockchain,” has been a prime loser when it comes to price so far into the 2022 bear market.

The perennial top-10 crypto, which briefly reached as high as No. 3 behind ether and bitcoin for a few months in 2021, has fallen about 86% from its September 2021 peak of just over $3 per coin.

The chain’s total value locked (TVL) has similarly fallen 77% from a peak in March 2022, according to DefiLlama — and now stands at roughly $76 million, good for 27th by that value.

Among the project’s latest highlights: an attempt to authenticate wine from the nation of Georgia, and “crypto-backed algorithmic stablecoin that acts as an autonomous bank,” called Djed — a tough sell in a post-Terra environment.

Its decentralized applications (dapps) have also struggled to compete with other tier-1s. The so-called Plutus smart contracts that underlie dapps are unique to Cardano and written in a relatively unusual coding language, Haskell. This means that dapps cannot be easily transferred from Ethereum so they can be deployed to an Ethereum virtual machine (EVM) compatible layer-1 blockchain.

Cardano has taken steps to attract developers and has ranked well in developer activity metrics, following research firm Santiment. But a year after the Alonzo hard fork, which first added smart contract functionality, its largest DeFi decentralized exchange, Minswap, records less than $1 million in volume on a typical day.

From Byron to Voltaire

The ethos of Cardano has been slow, meticulous progress along a roadmap of five eras named after famous writers: Byron, Shelley, Goguen, Basho and Voltaire.

Now, in the Basho era, the latest upgrade, Vasil, was on par with the Ethereum merger in terms of complexity, according to Cardano founder Charles Hoskinson.

The upgrade brings with it a version 2 of Plutus, which is expected to increase dapps’ throughput from about 1.5 transactions per second (TPS) to as much as nine. That might not sound like much compared to Ethereum layer-2s or Solana, but proponents point out that comparing Cardano’s Unspent Transaction Output (UTXO)-based model to an account model like Ethereum’s isn’t exactly apples to apples.

Still, according to Starbloom Ventures’ Evan van Ness, the bulk of Cardano’s transaction activity is simple cardano (ADA) transfers, not smart contract activity.

Like the historic Ethereum switch to proof-of-stake, Vasil did not provide an immediate boost to the ADA price.

Both the price and market cap remain firm in the Byron era, finding support around $0.42, since the crypto market crash in May, but gradually making lower highs.

It is not clear whether Basho’s focus on scaling will be enough of a catalyst to turn this around.

Cardano’s original roadmap is set to end in 2023, Hoskinson said, calling it “the strongest, most resilient self-governing organism ever conceived, with a population in the millions and a lot of benefit to everyone.”

Added Hoskinson: “There are many challenges ahead; there are many upgrades to be done.”