Cardano’s Ada Surges To New High, Becoming Biggest Cryptocurrency To Hit Record Price After $1 Trillion Crash

Cardano Surges To New High As Bitcoin And Ether Hit Highest Prices Since $1 Trillion Crash

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Topline

Following weeks of pent-up price momentum, cryptocurrencies rallied Thursday morning amid growing fervor for the buzzy blockchain-based digital collectibles known as non-fungible tokens and ongoing institutional adoption—boosting the market to levels unseen since a flash crash in May wiped out more than $1 trillion in value. 

Cardano has amassed nearly $100 billion in market value while bitcoin and ether hit their highest … [+] prices since May.

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Key Facts

As of 9 a.m., the value of the cryptocurrency market surged more than 5% over the past 24 hours, surpassing $2.3 trillion in market value and reaching its highest level since just days after crypto markets suddenly crashed from an all-time high of $2.6 trillion in early May, according to crypto-data website CoinGecko. 

Headlining renewed gains in the market, Cardano’s ada token, which last month became the world’s third-largest cryptocurrency, hit a new high of $3.09 Thursday morning and amassed more than $99 billion in market value.

Investors have been plowing into the cryptocurrency ahead of a software upgrade this month that will allow it to support smart contracts, self-executing financial agreements underpinning the technology behind NFTs and the $100 billion decentralized finance space.

Ethereum, which has long dominated the market for smart contracts, surged 7% overnight to a price above $3,800—reaching a four-month high after NFTs posted record-breaking sales of $900 million in August.

Even bitcoin, which lags Ethereum in smart-contract support and has been underperforming the broader crypto market in recent weeks, jumped 4%, surpassing a $50,000 price for much of Thursday morning.

The only top token falling in value Thursday morning was Solana, down 3% after a stunning weeks-long rally that’s helped the fledgling cryptocurrency, which launched only 17 months ago, skyrocket in value by more than 6,000% this year alone.

Tangent

The market for NFTs has posted $2.5 billion in sales so far this year, almost 20 times more than $13.7 million over the same period last year. “With soaring interest from major investors like payments giant Visa, demand is set to explode,” Nigel Green, the CEO of $12 billion wealth advisory DeVere Group, wrote in a Wednesday note, while also acknowledging the risks of a nascent market reeling with optimism. “It can be expected that some of the NFTs on the market now will have little value in a few years, but some will be worth a fortune.”

Key Background

Alongside the buzz around NFTs, ongoing institutional adoption and heightened inflationary concerns have helped the cryptocurrency market pare back losses since regulation in China sparked a nearly 50% crash in early May. The market is still down about 12% from its all-time high, but it’s skyrocketed more than 40% over the past month. According to research from crypto hedge fund Nickel Digital, 49% of money managers (who have a collective $275.5 billion in assets) believe institutions will turn to cryptocurrencies for the first time this year to hedge against the threat of inflation, which is growing at its quickest pace in nearly 13 years. 

Chief Critic

“A fatal mistake that new crypto investors make is looking at the past and extrapolating that to the future. Don’t invest more than you can afford to lose,” says Bankrate analyst James Royal, pointing out some cryptocurrencies heavily rely on market optimism for price gains, as opposed to stocks, where company profits generally drive returns. “If your financial investment is not backed by an asset or cash flow, it has the potential to be worth nothing.”

Further Reading

Ether Extends Gains Past $3,500, Bitcoin Remains Stuck Below $50,000, And Solana Pulls Back (Forbes)

Cardano’s Ada Surges To New High, Becoming Biggest Cryptocurrency To Hit Record Price After $1 Trillion Crash (Forbes)

Solana Skyrockets To New High—Amassing Nearly $40 Billion In Market Value As Competition With Ethereum Heats Up (Forbes)

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