Cardano’s ADA is back on the growth path (+13%), thanks to $10 million in purchases by institutional investors.
The cryptocurrency market may be entering a recovery phase, after a very brutal correction. If Bitcoin was involved, other crypto-assets were not spared. Observers also pointed to a bubble phenomenon.
Is this bubble now a thing of the past? It may be a bit early to conclude. Nevertheless, the main tokens of the market have been growing since May 24, as has ADA.
Cardano’s native cryptocurrency is up 13.6% at $1.56. It is not yet back above $2, the threshold it reached on May 14. Since then, ADA has been in a very steep decline.
Bitcoin is also recovering. Have environmental concerns been forgotten by investors? Probably not. The latter are not drawing a line under the events of recent weeks.
On the contrary, energy consumption is now a factor of choice. And Cardano, which is based on a Proof Of Stake consensus, would benefit from the new situation. Institutional investors would thus arbitrate in favor of the ADA.
This is at least the analysis of CoinShares. In the week ending May 24, Cardano investment funds attracted more capital than any other digital asset. As a result, institutional investors were acquiring $10 million worth of ADA products.
For comparison, over the period, Bitcoin funds recorded a capital outflow of $110.9 million. For Ethereum, this amount reached $12.6 million. For Cardano, the flow is on the contrary positive.
It is also positive for Polkadot ($5.5 million). However, it is ADA that takes the first place in this area. However, the token is still far from competing with the first two cryptocurrencies over 2021.
Year-to-date, Cardano investment products total $24 million in institutional assets, compared to Bitcoin’s $4.13 billion and Ether’s $924 million.
Cardano would have a card to play, however, thanks to the rise of environmental concerns adverse to PoW-based blockchains.
“Cardano saw the largest inflows at US$10 million, which may reflect investors’ active choice in favor of proof-of-stake based coins due to environmental considerations,” CoinShares analyzes.