Cardano TVL – A Crucial Factor For ADA Price Revival?

Christian Encila

1 year ago

3 mins read

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Cardano has leaped considerably in the realm of DeFi activities, particularly in terms of Total Value Locked (TVL), despite the somewhat lackluster performance of ADA itself.

TVL refers to the total value of assets locked within various decentralized finance protocols and applications on the Cardano blockchain. An increasing TVL can have several positive implications for the Cardano ecosystem.

The significance of TVL lies in its reflection of the overall engagement and adoption of DeFi projects built on Cardano. A higher TVL indicates greater trust and confidence in these decentralized financial services.

It demonstrates that users are willing to lock their assets within the ecosystem, utilizing various DeFi protocols for lending, borrowing, staking, and other financial activities.

Cardano TVL Surges Amid Price Decline

ADA has experienced a recent decline in its price, with the latest data from Coingecko showing it currently stands at $0.305. Over the past 24 hours, the price has faced a modest 0.4% decline, and over the last seven days, it has decreased by a mere 0.3%. Despite these losses, there is a notable silver lining in the form of Cardano’s TVL on the network.

Source: Coingecko

The surge in Cardano’s TVL by 28% in the last three months indicates a growing interest in the DeFi activities offered by the network. It reflects growing confidence among users willing to lock their assets in decentralized applications, such as lending platforms, decentralized exchanges, and liquidity pools.

This increased participation can foster the development of a vibrant and robust DeFi ecosystem on Cardano, offering users a wide range of financial services.

Cardano total value locked. Source: DefiLlama

Moreover, the year-to-date (YTD) triple growth of Cardano’s TVL raises optimism for the project’s potential recovery and a potential return to its previous all-time high levels achieved in 2022.

As the DeFi ecosystem on Cardano expands, it can attract more developers, projects, and investors, further enhancing the network’s utility and value proposition.

Cardano (ADA) market cap currently at $10 billion. Chart: TradingView.com

Cardano DeFi Lockup Surpasses Ethereum, But Market Cap Lags Behind

Meanwhile, a recent report sheds light on a noteworthy plunge in the total tokens locked within Ethereum, Cardano’s main rival. On the other hand, Cardano has emerged as a strong contender, outperforming Ethereum regarding individual token lockup within its DeFi ecosystem.

While Cardano excels in terms of token lockup, it still needs to catch up in other critical areas compared to Ethereum. One of the most significant disparities lies in the market capitalization of the two cryptocurrencies. Ethereum’s market capitalization remains considerably higher than Cardano’s, highlighting Ethereum’s long-standing dominance in the blockchain space.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

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Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.