For much of 2020, Cardano (CCC:ADA-USD) traded for barely a nickel. That changed when buying volumes picked up toward the last month of last year. By February, Bitcoin, Cardano and other cryptocurrencies took off.
At current levels, is Cardano a buy? Investors and speculators alike have no idea what the altcoin is worth. One author called ADA a hold, and warned readers not to trade it. Another author said Cardano’s momentum showed no signs of slowing down. Just days before that, the altcoin pulled back by 28% from its April 15 high.
Cardano Pullback and Breakout
Cardano’s price is at the mercy of bitcoin, and to a lesser extent, other cryptocurrencies. Investors need to absorb the hourly news headlines moving the currency. For example, Elon Musk, the Chief Executive Officer of Tesla (NASDAQ:TSLA) recently tweeted about Dogecoin. He simply posted “The Dogefather. SNL May 8.”
His appearance on the television show will draw more viewers to his Twitter account posts. This will empower him to move Dogecoin prices even more.
Investors seeking to profit from Bitcoin may use altcoin as a means. Accumulating it, booking the gains by selling altcoin, and then adding to Bitcoin and Ethereum is one strategy available.
Cryptocurrency speculators may also add Chainlink and Algorand to their portfolio of currencies. This would diversify holdings in the crypto space.
Investors may broaden their holdings further by buying publicly-listed cryptocurrency exchanges. For example, Voyager (OTCMKTS:VYGVF) is highly correlated to the value of crypto. Marathon Digital Holdings (NASDAQ:MARA) and Riot Blockchain (NASDAQ:RIOT) are good stocks to consider, too. Riot Blockchain is a bitcoin mining company. It supports the Bitcoin blockchain by increasing its bitcoin mining hash rate. It also decreases its production costs.
On April 7, Riot Blockchain bought 42,000 S19j Antminers. This increased its total hash rate to 7.7 EH/s. Investors buying RIOT stock are effectively buying the gold miners of the cryptocurrency market. Savvy investors may write calls against RIOT stock. The stock, along with those mentioned above, is highly volatile and pays a generous premium.
Risks of Correction
Just as the infamous tulip crash during the Dutch Golden Age in 1637, Bitcoin and altcoins risk falling. Yet an after-hours drop of 5-10% is typical for the currency. A daily drop of 10% happened occasionally throughout the years. And in the last decade, Bitcoin survived every time.
Bears who guessed on a prolonged correction lost the chance to accumulate altcoin on the dip. Furthermore, the crypto market is a revolution in finance that is unstoppable. Assuming that regulators will not interfere, the prospects of the technology keep rising.
Investors who picked Cardano are fine. Polkadot is a decentralized blockchain that, like Cardano, is developing its technologies. As Cardano delivers, bears betting against it will fail. In the long run, Cardano may have a higher value than Bitcoin. Such prospects more than offset the risks of buying ahead of a correction in the altcoin.
Despite the upside potential, Cardano’s competition is fierce. Polkadot, Avalanche, and Solana are some competitors. All of them have a thriving community supporting the decentralized application development platform. They also have a working product. Cardano has five eras in its roadmap, as explained here.
Fortunately, Bitcasino.io is supporting Cardano’s ADA for payments. The more operators embracing Cardano’s ADA cryptocurrency, the higher its value.
Cardano: Your Takeaway
Investors may use technical charts to guess what ADA is worth. It could watch the price of other cryptocurrencies and altcoins, too. This will not predict Cardano’s future value.
Cardano is an exciting currency with strong prospects ahead. It will play a big part in the decentralized finance movement.