CRYPTO MOVERS AND PRICES
Crypto is rallying after a weekend sell-off. Smart contract network protocol tokens Ethereum (ETH), Binance Coin (BNB), and Polkadot (DOT) are seeing the largest gains in the Top 10.
Crypto Story of the Day
The Cardano Smart Contract Network’s native currency, ADA, hit an all-time high on Saturday, achieving a market cap of USD 42 billion and becoming the third-largest crypto by capitalization. ADA’s rally comes ahead of the network’s March 1 “Mary” upgrade, described as introducing “native tokens [and] multi-asset support” on the network.
At the beginning of February, Input Output HK (IOHK), a firm developing the Cardano network, announced that the network’s testnet had undergone the “Mary” upgrade while the mainnet would undergo the upgrade at the end of the month. Last Wednesday, IOHK announced that the Mary upgrade had been “fully confirmed for March 1.”
The Mary upgrade, which is considered a key step towards Cardano’s next development phase, Goguen, introduces “multi-asset support to Cardano, allowing users to create uniquely defined (custom) tokens and carry out transactions with them directly on the Cardano blockchain.” However, the Mary upgrade doesn’t introduce smart contract capabilities to the network. These capabilities are expected to be introduced to the network via the “Alonzo” upgrade, which has yet to be scheduled.
Together, Mary and Alonzo represent steps in taking Cardano to its Goguen development phase. ADA added approximately USD 11 billion to its market cap since March 1 was confirmed as the date for the Mary upgrade. The coin’s rally was preceded by parabolic growth by Binance Coin (BNB), which added as much as USD 27 billion to its market cap.
BNB’s growth came on the back of growing activity on its native Binance Smart Chain network via several DeFi applications and a concerted campaign by Binance CEO Changpeng Zhao to highlight the throughput issues of ETH. That network has been experiencing heightened transaction fees, affecting the costs associated with using applications on the network.
Google search volume for the term “DeFi” reached a 5-year high at the beginning of February, on the back of mainstream endorsements of key smart-contract-related concepts. Google search volume for “Cardano” is currently at 5-year highs after seeing an uptick in late January following years of depressed interest.
Cardano’s record price gives the network a valuation which exceeds ETH’s September 2020 market cap. At that time, ETH enjoyed smart contract capabilities and an ecosystem of projects, albeit with considerable scaling and throughput challenges.
Cardano has achieved ETH’s September market cap with a fraction of those capabilities and a list of technical ambitions that are unproven and untested. The Mary upgrade, though placing Cardano a step closer towards Goguen, is only the 3rd step of a 5-part roadmap.
Considering that ADA staking, which forms the backbone of the blockchain’s functioning, was only just introduced in July, the network is in its infancy compared to its technical ambitions. In that context, ADA, along with ETH and BNB’s recent performance, reflects a situation where interest in smart contract networks has vastly outpaced their practical capabilities.