The Federal Reserve initially categorized the inflation increase as temporary. But interest rates are rapidly increasing now that it is clear the central bank made a grave error. Investors are scared by this, especially those who invest in cryptocurrency.
While the S&P 500 is down 21% in 2022, the digital asset market as a whole has lost over half of its value this year. But there are still some chances for savvy investors who can look past the short-term instability.
Take a hard look at Cardano (ADA -0.45%) if you’re looking to purchase a new cryptocurrency.
Former Ethereum (ETH 0.14%) co-founder Charles Hoskinson introduced the potential blockchain Cardano in Sept. 2017 with the aim of addressing some of Ethereum’s scalability issues. Over its lifetime, Cardano has delivered a fantastic return of 1,570%. But because of the 2022 bear market, it now has a market cap of $14.5 billion, ranking it as the eighth most valuable cryptocurrency in the world. Additionally, there were 34.99 billion ADA, Cardano’s native token, in use as of the time of writing, with a unit cost of roughly $0.42.
Cardano is distinctive because of its staged development methodology. Computer scientists and academics from renowned universities across the world peer review new versions. Longer wait times for the introduction of new features result from this technique, but it also makes sure that all potential bugs are taken into account.
My opinion is that a cryptocurrency’s chances of success and survival in the long run increase with the amount of real-world utility it can offer. This is due to the fact that as more people join the ecosystem, ADA should see an increase in demand and pricing. And in regards of use cases, Cardano is gaining traction in a number of applications, including supply chain tracking in agriculture and identity verification in the financial services industry.
Think about the long term.
As I mentioned earlier, some market analysts believe that a U.S. recession is imminent due to rising interest rates, a pattern that is likely to continue for some time to come. Therefore, in light of the increased macroeconomic uncertainties, cryptocurrency investors should moderate their expectations. Before things get better, they can get worse, so it’s wise to be ready for turbulence.
However, it’s encouraging to see that Cardano doesn’t rely on—and really shies away from—trying to generate sensational headlines in order to fast increase the value of its coin. Many coins already carry out that function. Rather, taking a methodical and careful approach will only work to secure Cardano’s long-term existence.
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