Cardano dominates the top 50, while Ethereum continues to benefit from token burning. The market update.
The Cardano (ADA) course is still on the upswing as the eagerly awaited upgrade “Alonzo” is just around the corner. With Alonzo, Cardano will receive smart contracts and, at least according to the ambition of the project, could become serious competition for the smart contract pioneer Ethereum. Cardano founder Charles Hoskinson will announce when exactly this will happen later in the day.
Cardano bulls (still) repel their horns
At the time of writing, ADA is trading at $ 1.97. The prospect of a specific start date for the Cardano Smart Contracts, which form the basis for a flourishing ecosystem of decentralized applications (dApps), gives the ADA course a strong daily increase of 12.6 percent at the time of going to press. With this, Cardano clearly outperforms the other top 50 coins.
Within the last 24 hours, the Cardano exchange rate scratched the USD 2 mark several times, but so far there has been no convincing breakthrough.
Even if the USD 2 level still presents itself as strong resistance, Cardano is looking back on a bullish week. The ADA rate increased by a whopping 43.4 percent in a 7-day comparison. It will be interesting to see whether, after Hoskinson’s Alonzo update, a scenario of the brand “Buy the rumor, sell the news” will unfold, or whether it will provide the necessary impetus for overcoming the $ 2 mark in the long term.
Ethereum: EIP-1559 heats up the Ether course further
Meanwhile, holders from Cardano’s competitor Ethereum (ETH) cannot currently complain about a lack of returns. At 3,200 USD, the ether price can maintain its position above the psychologically significant 3,000 USD, which it cracked in the course of the “London” upgrade last week. On a monthly basis, the second largest crypto currency was able to gain a full 64.4 percent, in a daily comparison, ETH is printing an increase of around 2.5 percent. Since the end of July, the EMA (9) has presented itself as support for the ongoing Ether rally.
It can be assumed that the most recent gains in the Ethereum rate are primarily due to the August 5th London upgrade. With the new base fee, which is incurred and destroyed with every transaction, Ethereum’s token economy has received a deflationary element that inspires price fantasies. At the time of writing, 36,495 ETH have already been “burned”. This means that within a week, ETH worth 114 million USD went into the digital furnace. In the past 24 hours, the burn rate averaged 3.33 ETH per minute. There have already been moments when the burn rate was higher than the distribution of new ETH to the miners; Ether was already deflationary in the meantime.
A hot autumn awaits us
Deflation has its price, however. A high burn rate means that the block utilization and thus also the base fee is particularly high. This in turn means that you have to pay a bigger tip to the ETH miner to get your transaction through, which makes it more expensive overall. Ethereum still only offers really low fees with the help of a second network level (Layer-2, L2) such as Polygon (MATIC). Cardano, on the other hand, manages without the supposed “crutch” of an L2 solution and can scale on-chain. If the project keeps its promise, it could still be a hot autumn in the DeFi space.