ADA/USD Correlation With BTC/USD Dips to Negative, An Extremely Rare Occurance
Cardano (ADA), currently the third-largest cryptocurrency by market cap has recorded an extremely rare feat, where ADA/USD correlation with BTC/USD fell into negative territory, in what many considered almost impossible for a non-stable coin. ADA had recorded a phenomenal run in the last couple of weeks of February registering its all-time-high of $1.48 and replaced Tether for the third spot.
A negative correlation against Bitcoin can go both ways where if Bitcoin price is falling, Cardano might register a bullish surge and vice versa. In the current market scenario Bitcoin is struggling to breach past the immediate resistance of $52,000, on the other hand, Cardano fell below $1.2 after holding the position for quite some time.
Crypto Community Divided Over Cardano’s Rise
Cardano blockchain is another Ethereum challenger and with its recent hard fork called Mary on March 1st, it became a multi-asset blockchain just like Ethereum. The fact that Cardano founder, Charles Hoskinson has also founded Ethereum along with Vitalik Buterin makes Cardano’s contention for Ethereum-killer more interesting. However, the crypto-community seems to be divided over Cardano’s rise and its potential as an Ethereum challenger.
Many Ethereum proponents have called Cardano a scam and its recent rise a ‘bubble’ since most of its use cases seem to be a couple of years late than what Ethereum already has on offer. On the contrary, Cardano proponents believe Cardano would have a massive impact in the future.
The market values Cardano for what it would do in the future, not for what it can do today. Same goes for Ethereum, or any stock.
Instead of bashing other projects, understand we are all on the same boat. If the free market values X project at Y price let it be, it's all good.
— Javier Mendonça (@javiermendonca) February 26, 2021
Ethereum is currently a whole ecosystem that offers smart contracts, Dapp hosting, Defi ecosystem, tokenization, and many other functionalities, one of the key reasons behind its current scalability issues and rising gas fees. The current market congestion and extremely high transaction fee have made many looks for alternatives, one of the key reasons behind the recent rise in popularity of Ethereum like blockchain be it Binance Smart Chain or Cardano.
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