Why does the “crazy” rising ADA become a “monster”?

The native token ADA of the public chain Cardano has become the third largest token in the current market value after BTC and ETH . According to data from CoinMarketCap, as of August 27, the market value of ADA has reached 82.151 billion US dollars. Behind this is the “crazy” rise in the price of ADA. According to CoinMetrics’ corrected currency price data, ADA has repeatedly exceeded US$2 this year. It closed at US$2.67 on August 22, the highest in history. This year’s return on investment (in currency holdings) has performed very well, reaching 1421%.

What factors contributed to the skyrocketing ADA? What are the noteworthy changes in Cardano after the currency price climbed? PAData analyzed ADA’s market data and Cardano’s on-chain data and found that:

1) ADA broke through USD 2 several times during the year, and the annual currency holding rate of return was approximately 1421.71%. However, the 30-day investment return rate did not coincide with the currency price trend. The peak return rate during the year appeared in the first quarter, and due to the recent sharp fluctuations in the currency price, the performance of currency holdings declined.

2) The daily trading volume of the ADA spot market is approximately US$ 11.434 billion, and the daily trading volume of the futures market is approximately US$9.301 billion. Binance is the largest trading market. The main investors may come from China, the United States and South Korea.

3) The number of ADA non-zero addresses reached 2.0394 million, an annual increase of 239.93%. Over 75% of the address balances were concentrated between 10 ADA and 10,000 ADA. And from the change in the number of addresses at all levels of balances, this year, the number of addresses from 1 ADA to 1000 ADA has increased significantly, but there is a tendency for large coin holders to decrease.

4) The activity of ADA users has increased significantly this year. Currently, the number of ADA’s daily active addresses has exceeded 110,000. This year, the average daily active address number is 76,100, an increase of 631.73% over last year.

5) The activity of transactions on the Cardano chain has increased significantly this year. The total monthly average number of transactions on the chain is approximately 973,000, an increase of 620.74% from the total monthly average of last year. The monthly average total on-chain transactions increased rapidly by 1134.78% compared with last year, and the monthly increase was higher than the market value increase. In general, the activity of on-chain transactions basically matches the development of market value.

6) The high pledge rate provides strong support for the ADA currency price. At present, the total amount of staking pledges exceeds 67 billion U.S. dollars and ranks first in the industry. The pledge rate is close to 70%. The total number of addresses participating in the pledge exceeds 320,000. The expected annual income of the currency standard is about 5.25%.

The currency price rose by about 1421% during the year.

Binance is the largest trading market

This year, ADA broke the relatively stable trend of last year and entered an obvious upward channel. According to statistics, ADA has a 13-day closing price this year that exceeded US$2, reaching a maximum of US$2.67. Since March, the closing price has basically stabilized at more than US$1. Today the average price is about $ 1.21 compared to $ 0.09 last year’s average price rose 1244.44%, increase significantly.

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The upward currency price drove the increase in yields. According to statistics, as of August 22, the expected rate of return of ADA’s currency holdings this year was about 1421.71%, compared with only 449.70% for the whole year of last year, which is equivalent to this year’s expected rate of return of currency holdings tripled from last year. From the perspective of a smaller market cycle, the average 30-day yield this year is about 48.4%, compared to 19.3% last year, which is equivalent to 2.5 times the average 30-day yield this year compared to last year. This means that even With short-term currency holdings, this year’s expected rate of return is also significantly better than last year.

However, the 30-day rate of return this year has not been consistent with the currency price trend. The peak rate of return during the year appeared earlier than the peak of the currency price during the year. It can be seen that the period of time that brings higher returns to investors is mainly in the early stage of the rise of the market, that is, this year. In the quarter, and affected by the recent large fluctuations in currency prices, the performance of currency holdings was not as good as at the beginning of the year.

From the perspective of the trading market. Binance, PayBito, Coinbase and Upbit are the four main spot markets, with a combined daily transaction volume of approximately 56%. Among them, Binance has the largest transaction share, exceeding 28%. Secondly, Bitrue, Huobi, and Binance JEX also have a trading share of more than 3%, which is a larger trading market.

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Binance is also ADA’s largest futures trading market, with its perpetual contract daily trading volume accounting for approximately 58%, and its delivery contract daily trading accounting for approximately 36%. In addition, Huobi is also the main trading market for ADA delivery contracts, and its trading volume accounts for approximately 42%.

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Judging from the geographical distribution of the main users of these main trading markets, users in China, the United States, and South Korea may be the main investors in the ADA secondary market.

Daily active addresses have exceeded 110,000,

Non-zero address presents an awl structure

In addition to rising currency prices, Cardano’s on-chain fundamentals have also developed to a greater extent this year. From the perspective of user scale, as of August 22, ADA’s non-zero addresses have reached 2.0394 million, an annual growth of 239.93%, and the growth rate has increased by 242.71% compared with last year. The number of daily active addresses of ADA has exceeded 110,000, the highest number of daily active addresses has reached 177,300, and the number of days when the number of daily active addresses exceeds 100,000 has also reached 51 days. In addition, the average level of user activity has also increased significantly. According to statistics, the average daily active address of ADA this year is 76,100, an increase of 631.73% from last year.

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From the perspective of the user structure, the structure of the ADA currency holding address is a “small at both ends and a big middle” awl structure. Over 75% of the address balance is concentrated between 10 ADA and 10,000 ADA, of which about 33% of the address balance is concentrated in Between 100 ADA and 1000 ADA.

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Judging from the changes in the number of addresses at all levels of balance this year, the addresses from 1 ADA to 1000 ADA have increased significantly this year, reaching about 186%. Secondly, the increase in addresses from 1 ADA to 10 ADA, and from 100 ADA to 1000 ADA is also increasing. Around 59%.

However, it is worth noting that the number of addresses at all levels with a balance of more than 10,000 ADA this year has dropped by more than 60%. This may mean that the middle layer of the ADA “awl type” structure has a further downward trend, that is, the number of large-value currency holders decreases, and the small and medium-sized currency holders increase. In the future, the main currency holders of ADA may change from addresses ranging from 100 ADA to 1000 ADA to addresses ranging from 10 ADA to 100 ADA.

The average number of transactions this year exceeded 970,000.

On-chain transaction activity basically matches the development of market value

Cardano’s on-chain transaction activity has also increased significantly this year. According to statistics, as of August 22, Cardano’s total number of transactions on the chain this year has reached 7,783,500, an increase of about 379.75% from the total number of transactions of 1,622,400 last year, and the overall increase is significant. This year, Cardano’s monthly average total number of transactions on the chain is about 973,000, which is an increase of 620.74% from the total number of monthly average of 135,000 transactions last year. The average growth rate higher than the overall growth rate may be affected by the number of transactions on the chain exceeding 1.61 million in a single month in May of this year. At that time, the currency price of ADA hit a record high.

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From the perspective of transaction volume, the total amount of Cardano’s on-chain transactions so far this year is approximately US$1.135.617 billion, an increase of 719.63% from the total amount of US$138.552 billion in last year’s chain transactions. It is expected that this increase will continue to expand by the end of this year. . In addition, this year’s Cardano’s monthly average on-chain transactions totaled approximately US$142 billion, a rapid increase of 1134.78% over last year.

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Although under the statistics of legal currency units, the growth of on-chain transaction volume is affected by the increase in currency price, the proportion of on-chain transaction volume in market value has shown a clear upward trend this year, that is, the growth rate of on-chain transaction volume is generally higher than the increase in market value. , Which confirms the activity of transactions on the Cardano chain this year from the side. However, the proportion of on-chain transactions in market value has not risen to an extreme high this year. In July this year, the proportion of on-chain transactions in market value was about 21.10%, which was only one drop from the highest value reached in January last year of 22.33%. In addition, from the average point of view, the monthly average value of this year’s on-chain transactions in the market value is about 11.32%, which is only about 4 percentage points lower than last year’s 15.60%. Overall, this proportion has remained relatively stable, which may mean that the activity of transactions on the Cardano chain this year basically matches the development of ADA’s market value.

The pledge rate is about 70% as the largest staking token,

Average expected annualized pledge rate of return is 5.25%

The data on the chain has shown that behind this year’s ADA surge is the result of the joint promotion of the scale of users on the chain and the scale of transactions. However, another big factor that cannot be ignored is that Cardano is a PoS token, and the staking mechanism also provides certain support for the strengthening of the ADA currency price.

According to the data of Staking Reward, as of August 23, the number of addresses participating in ADA staking exceeded 756,500. The total number of staking tokens accounted for about 69.8% of the total circulation. The total amount of staking reached 67.127 billion U.S. dollars. The coin with the highest total pledge amount.

According to the total amount of pledge, PAData selected the 20 largest ADA pledge markets to further analyze the pledge situation. According to statistics, Binance Staking’s total pledge amount reached 8.208 billion US dollars, accounting for 12.22% of the total pledge amount. It is currently the largest ADA pledge market. Secondly, the total pledges of Moonstake, AdaLite Stake Pool, Everstake, 1 Percent Pool, and Input Output Global-Private are also between US$1 billion and US$2 billion, accounting for 1.6% to 2.6% of the total pledge. The 20 largest ADA staking markets account for about 32.32% of the total staking amount, which means that the ADA staking market is relatively fragmented. Except for Binance Staking, the concentration of the remaining head markets is not high.

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From the perspective of the number of staking addresses of major mining pools, the number of addresses using Everstake service is the largest, with a total of 190,800. Secondly, the number of addresses using Atomic Wallet and AdaLite Stake Pool services is also larger, exceeding 55,900 respectively. And 26,800. The number of addresses that use the remaining mining pools for pledge does not exceed 10,000, and the least is only 3.

However, ADA’s Staking expects that the annualized rate of return on the currency standard is not high. The average expected annualized rate of return of the currency standard of the 20 major pledge markets is about 5.25%. Except for the expected rate of return of ADALovelacePool, ZZZ2, Input Output Global-Private, and 266a2…f65dd, which are less than 5%, the rest are all above 5%. , And many have exceeded 5.5%.

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According to the expected annualized currency standard rate of return of 227 pledge assets calculated by Staking Reward, the average is about 14.95%. The pledge rate of return of ADA is obviously lower than the average. However, considering that the ADA currency price has increased significantly this year, even the lower currency standard income can play a role in the income bonus.

The latest news shows that Cardano will officially support smart contracts in September. In the future, Cardano’s ecology may develop. The prosperity of the ecology may promote the further development of Cardano’s native token ADA, but it still needs to wait for the DApp on Cardano to form a certain scale.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/why-does-the-crazy-rising-ada-become-a-monster/
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