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Cardano (ADA) Price Rally Still Being Driven By Coinbase?

Cardano ADA Coin Price Prediction 2019

Cardano, the cryptocurrency developed by Inside Outside Hong Kong (IOHK) and CEO Charles Hoskinson, has developed a significant amount of interest in the crypto space since breaking onto the market in November 2017.

Not only in Hoskinson at the helm of a dedicated, talented team of cryptocurrency and blockchain developers, but he represents a long-standing figure in the industry, having co-founded Ethereum and a played a role in the early years of its meteoric rise. Now, through the Cardano protocol and ADA cryptocurrency, Hoskinson and his group at IOHK are seeking to improve upon the industry standards of network-based cryptos. As opposed to the trend of Proof of Work coins, modeled in the vein of Bitcoin, Litecoin and other industry mainstays, Cardano broke the industry mold to pursue Proof of Stake (PoS).

Even Ethereum, second ranked cryptocurrency by market capitalization and industry leader in smart contracts and decentralized applications, has recognized the advantages of Proof of Stake and will be transitioning to the model in the coming year. Proof of Stake provides an improvement in the efficiency and energy cost of network maintenance, shunning the overworked, raw hash-rate generating power of Bitcoin and other PoW currencies.

Cardano also provides a significant advantage over the market in the form of staking, one of the most interesting innovations to come out of Proof of Stake. While Proof of Work relies upon the computational power of numerous machines to verify and insure the security of network transactions, Proof of Stake relies upon the “staked” resources of investors and network users. ADA holders can pledge a certain amount of coins to staking through the Cardano wallet, which has the effect of increasing and improving the overall network services. Therefore, the utility of the network increases with the number of users willing to participate–a feature that could prove to be a substantial windfall in terms of efficiency if cryptocurrency adoption takes off.

In return for staking coins, investors are rewarded with a dividend/interest paid in proportion to the resources they offer up. Last week, Coinbase Custody announced support for Tezos staking to institutional clients willing to store their XTZ through the exchange as opposed to individual wallets. The move represents a shift for crypto exchanges to both offering coin security to large capital investors, while allowing them to benefit from rewards like staking interesting.

In addition, Coinbase has been tied to ADA since announcing the coin as one of five cryptocurrencies under evaluation for addition. Since that initial press release in mid-2018, the four other coins included have been added to the exchange.

Following the most recent addition of XLM to Coinbase, only Cardano remains to be listed on the exchange, leading many investors to assume that a Coinbase/ADA pairing is forthcoming. While cryptocurrency just saw a massive rally that took Bitcoin above $5000 and generated double digit gains for most top cryptos, ADA outpaced the market, gaining 42 percent at the height of it run.

ADA, as of writing, has started a retraction in price consistent with the broader market. But the most recent, massive gains for Cardano relative to other coins was likely driven by investors anticipating that Coinbase still has its target set on ADA.

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All Eyes on Cardano ADA After Coinbase Stellar XLM Addition

Following yesterday’s sudden addition of Stellar XLM to U.S.-based cryptocurrency exchange Coinbase, investor interest has quickly shifted to Cardano ADA.

While the entire industry is experiencing a bump in price, with Bitcoin making another run at $4000 for the third time in 2019, eleventh-largest coin by market capitalization Cardano has managed to outpace the rest of the market.

Some of the ADA price action is being driven by a buoying of the rest of the market, with most coins experiencing a double-digit appreciation since the start of the year–a welcome change from 2018’s endless downward spiral. However, many investors are also piling into Cardano from FOMO and anticipation of another Coinbase listing, with ADA being the last of a long-awaited group to be added to the exchange.

In July 2018, Coinbase announced exploration into five new cryptocurrencies for listing, addressing one of its most common customer complaints that the exchange’s offering was too limited. Of the five coins that were originally outlined in that update, Cardano is the only coin to not yet be listed.

Despite, at the time, Stellar XLM and Cardano ADA being the most popular and heavily favored choices for Coinbase to offer investors, it’s surprising that they were the last two coins to be considered–with ADA still waiting for integration. However, both coins offer significant advantages to both Coinbase users and the industry of crypto. Stellar has been at the forefront of non-profit cryptocurrency engagement, and is targeting unbanked populations in developing countries.

Cardano, similar to Ethereum, is looking to build a network of blockchain use that extends beyond monetary transfers. With the guidance of IOHK CEO and former ETH co-founder Charles Hoskinson, ADA has managed to build a fair amount of interest in the 1.5 years it has been available on the open market.

However, the current rush of ADA investors would be wise to consider the position of Coinbase. While it does appear that the exchange is set on increasing its cryptocurrency selection at an accelerated pace relative to past engagement, there is no guarantee that Cardano will be coming to Coinbase any time soon. Investors are basing their decision on the fact that XLM followed XRP’s listing by a few weeks, as opposed to the months that have traditionally passed between Coinbase listings.

Despite Coinbase announcing in December their intention to add hundreds of new currencies–with XRP being listed as one of the possible coins–some community members believe that Ripple paid for the coin to be added to the exchange. For one, the timing was convenient for both Ripple and XRP, giving a positive boost to the currency in the wake of J.P. Morgan’s JPM Coin announcement. And, as other analysts have pointed out, XRP violates Coinbase’s guidelines for listing new currencies by way of Ripple’s majority stake in the coin.

That being said, investors are attempting to make the most out of the Coinbase FOMO and new coin excitement, given the waning we have seen over the last year in the exchange’s influence on cryptocurrency prices.

Title image courtesy of beatingbetting.co.uk

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Cardano Price Analysis: ADA/USD Register New 2018 Lows, Floors not Visible

Latest Cardano News

Aside from developing this peer-reviewed smart contracting platform, Cardano is all about the community. Participants are “amazingly diverse and vibrant”. We saw Charles Hoskinson and Ken Kodama open letter and how they needed the community to rally behind their effort to rid the chairman of the Cardano Foundation whom they accuse of incompetence and attempts to coalesce power.

Part of Cardano’s guiding principles include “the growth of the community and its needs”. Now, as they work towards Voltaire, they are also diligent taking every step with caution and even including third parties to hold IOHK accountable assuming there are flaws that end up hurting users.

Read: 2 Reasons Cardano (ADA) Could Be Listed on CoinBase Before Stellar (XLM)

Patience, diligence and commitment to quality are the hallmarks of Cardano and this is rightfully so especially when we recognize that a financial operating system and a multi-layered protocol is being built. It demands exceptional attention to detail to every line of code and this monumental task is heaped on IOHK which aside from guiding this project also has other activities to deal with.

As a result of this and the realization that Cardano isn’t lacking in engineering resources but the fact that they are researching and at the same time building the protocol which is difficult. Because of this postponement of Project Shelly’s Q1 deadline is almost inevitable.

ADA/USD Price Analysis

ADA/USD Price Analysis

At spot prices, ADA is down 15 percent and 30 percent in the last day and week but still hanging on at 10th. At this rate, prices are not only trending at new 2018 lows but are confirming the bear breakout pattern of early August. We expect this draw down to continue as long as BTC prices dump and deadlines extended.

Trend: Bearish

Everything else constant, ADA has been on a free fall after breaching the 6 cents previous main support and now resistance. Unless otherwise, this trend should continue and ADA could slip below 1 cent before year’s close.

Volumes: Bearish, increasing

Of interest in our analysis are Nov 28 bull bar—218 million versus 140 million and Nov 4—131 million versus 127 million, Nov 5—144 million versus 123 million and Nov 6—165 million versus 127 million. Notice that, the trend is clear, the last three bars have increasing volumes but the deviation from average is not that wide.

In the meantime, Nov 28  high trade volumes didn’t stop sellers from marching forward, reversing earlier gains. At spot rates, ADA/USD is trading below Nov 2018 lows accompanied by high trade volumes. This is bearish and we expect prices to trend lower unless of course there are surges above 3.3 cents erasing these losses.

Candlestick Formation: Bear Breakout

Following drops of Nov 19, ADA sellers drove prices below important support level completing the bear breakout pattern set rolling in early August. The drop has been near perpendicular and as long as prices trend below 1.5 cents, bears are in control.

Conclusion

11 months later and sellers are not slowing down partly because of BTC price declines. We expect losses to continue and as ADA/USD trade below 3.3 cents, the bear breakout pattern of Nov 19 is valid and sellers are in control. Floors are not yet visible and we shall recommend buying once proper bull reversal signals print perhaps driving prices above Nov 2018 lows and even 4.5 cents.

All charts courtesy of trading view

This is not Investment Advice. Do your own Research.

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