Despite the massive surge, Cardano spent most of the year below the US$2 mark

Cryptocurrency has made massive waves in the investment sphere with Bitcoin and Ethereum leading at the front. However, one new player that is giving tough competition to the top cryptos is Cardano. Cardano's digital token, ADA is currently positioned as the world's sixth-largest cryptocurrency. It has reached a record high of US$3 in September after a price rally and is currently at US$1.38. Despite the massive surge, Cardano's price spent most of the year below the US$2 mark. But what it holds for 2022 is a mystery. Therefore, we try to explore the possibilities of ADA reaching record highs in the coming year and what will trigger its value.

Over the past year, Cardano has gained traction as the best 'Ethereum Killer'. Based on historical price action, ADA has been a great investment for new and existing investors. Over the past seven days, Cardano's price has fallen by 10.98% while Bitcoin and Ethereum are down by 12.64% and 3.69%. However, before you invest in Cardano, you need to know its long-term performance and price predictions. On the other hand, you should also be aware of the factors that will drive its value in the future. Nobody knows whether the cryptocurrency will succeed as the best investment. But if you believe in ADA's long-term potential, be prepared to hold your investment through the waves of volatility. Similar to many other digital tokens, Cardano is also not a good pick for short-term investments. While ADA may be the new buzz in the cryptocurrency circle, we explore how things unfold for the digital token in 2022 and beyond.

The Basics of Cardano

Cardano is the third-generation cryptocurrency that integrates the hallmark features of the first-generation, Bitcoin, and the second generation, Ethereum. Its platform provides an efficient alternative to the standard Proof of Work (PoW) network used by Etheruem and similar tokens. Instead of PoW, Cardano uses Proof of Stake (PoS) to improve scalability and enhance sustainability compared to other cryptocurrency platforms.

Founded by Charles Hoskinson, a co-founder of Ethereum, Cardano has its core functions similar to ETH. We can evidently see that Charles has implemented what he learned from the Ethereum project in ADA coin and the blockchain network. Besides providing the best cryptocurrency Cardano platform can securely store information for many uses. It can process over 250 transactions per second compared to Bitcoin's 30. Cardano consumes two power plants of energy per year while Bitcoin eats up as much as what the Netherlands use.

Why is Cardano a Good Investment?

Cardano's Proof of Stake, ADA token, and its less energy consumption model are gaining a lot of attention in the cryptocurrency sphere. It has excellent scalability. Although the digital token can process 250 transactions per second for now, it is eventually expected to touch 1 million in the coming years.

According to a report, unique addresses currently staking ADA coins have grown nearly 7% in the last 30 days. This has happened after the digital token reached a 1 million transaction milestone in the last month. With newly added features and increasing adoption, Cardano is gaining traction like never before. At the center of its PoS mechanism, there are 3,100 stake polls managed by operators who are in charge of the network's distributed nodes. Cardano's parent company, IOHK, has also unleashed the new initiative to support its ongoing drive towards full decentralization with the launch of a new peer-to-peer (P2P) testnet.

What is in Bag for 2022?

Over the next few years, Cardano will significantly increase its value as mass adoption is already on its way. Although it is unclear whether ADA's market capitalization will grow much or not, one thing for sure is the anticipated price growth.

After hitting a record high in September, ADA fell back to a moderate value as traders took profit. According to predictions, Cardano is projected to reach US$3 in 2022 from its current value of US$2. The digital token will further climb to an average of US$4.87 in 2025 and touch US$7.32 in 2028.

What is Driving ADA's Price?

Many factors are driving Cardano's price towards a massive surge in 2022. Some of them are listed as follows.

Cardano is also expected to enter the institutional adoption circle in the future. As the investment grows, its value will also increase.

Market focus of supply and demand is expected to keep ADA on its heels. As the cryptocurrency has a restricted supply, demand-side factors are more detrimental to the price determination than the supply side.

Its environment-friendly features also contribute to its growth and make the digital token stand out from Bitcoin and Ethereum buzz.

The crypto network has also got a software update that is all set to position it as the biggest rival for Etheruem.