The price of Cardano (ADA) increased from USD 0.074 to USD 0.137, by more than 85% in less than two weeks. It surpassed Bitcoin SV (BSV) to become the sixth largest cryptomone currency by market capitalization.
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Cardano beats Bitcoin SV in market capitalization
Cardano outperforms Bitcoin SV in market capitalization. Source: CoinMarketCap.com
Three factors probably caused the intense recovery from ADA in the last few weeks. The potential catalysts are Shelley’s new upgrade, a favorable market structure and the rapid growth of the decentralized finance market (DeFi).
Why the Shelley upgrade is so important for Cardano and ultimately the price of ADA
On July 1, a node equipped with components of the Shelley upgrade was implemented in the main network. At the end of the month, on July 29, the changes will be implemented in the Cardano network through a hard fork.
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Shelley’s new upgrade has had a significant impact on ADA’s price due to its staking system. Cardano is a staking network, which means no miners. Users, who run nodes, keep the network staking ADA. In return, they benefit from the Cardano reward system.
The roadmap for Shelley from Cardano says:
„Shelley will also see the introduction of a delegation and incentive scheme, a reward system to encourage staking pools and community adoption. As a trial network for participation, users bet their ADA to participate in the network.
The roadmap also states that by the end of the Shelley upgrade, Cardano is expected to be decentralized with over 1,000 staking pools. It adds:
„By the end of the Shelley era, we expect Cardano to be 50-100 times more decentralized than other large blockchain networks, with the incentive scheme designed to balance around 1,000 staking pools.
The growing demand for ADA is likely due to investors who find the reward system under the new Cardano upgrade compelling.