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Wednesday, 25 Aug 2021
Crypto Notes
A weekly newsletter decoding crypto, blockchain and the entire ecosystem.
By Rohas Nagpal

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All about Cardano (ADA)

In last week's edition, we discussed Dogecoin. This week we take on Cardano (ADA).

Did you know?

Cardano has recently overtaken Binance Coin to become the world's third-largest cryptocurrency.

ADA has a market cap of over $90 billion.

In the past 24 hours, more than $8 billion of ADA changed hands. That's over Rs. 59,000 crore.

Before we dive deeper, let's check out the latest news from the crypto universe.

According to Deloitte's annual global blockchain survey, digital assets may replace fiat currencies in the next 5-10 years.

Japanese exchange Liquid was hacked, and $97 million worth of crypto was stolen.

According to a survey of 42,000 people across 27 countries, India is among the top three countries in crypto adoption.

1. What is Cardano (ADA)?

Name: Cardano

Symbol: ADA

History and overview:

Cardano is a blockchain network that is being developed into a decentralized application (DApp) development platform with a multi-asset ledger and verifiable smart contracts. Cardano hopes to become the platform of choice for large-scale enterprise use.

ADA is the native token of Cardano. It can be "staked" and in future will also be usable for services on Cardano.

There are three organizations behind Cardano - IOHK develops the technology, the Cardano Foundation supervises development and promotions, and Emurgo drives commercial adoption.

Cardano's full launch consists of 5 phases:

1. Byron (Sep 2017): mainnet launch of the Cardano blockchain

2. Shelley (Jul 2020): Ouroboros Proof-of-Stake (PoS) protocol went live

3. Goguen (2021): smart contracts and native token issuance features to go live

4. Basho: scalability and interoperability

5. Voltaire: voting, treasury system and governance by ADA holders

Consensus mechanism:

Proof-of-Stake (PoS) consensus mechanism called Ouroboros.

2. Metrics

As of 23 August, its core metrics are:

Price metrics

  US$ INR
Current price: 2.84 210
All-time high (Aug 23, 2021) 2.88 213.34
All-time low (Oct 01, 2017) 0.01735 1.29

Below is the graph for ADA prices over its recorded lifetime:

Supply metrics:

Circulating supply: 32.13 billion ADA
Total supply: 33 billion ADA
Maximum supply: 45 billion ADA

Note:

Circulating Supply is the number of coins / tokens in public hands.

Total Supply is the number of coins / tokens created minus the number burned.

Maximum Supply is the maximum amount of this crypto that can ever exist

Marketcap & Volume metrics:

  US$ INR
Market Cap: 90 billion 6,66,990 crore
Fully Diluted Market Cap: 127 billion 9,411,97 crore
Volume (24h): 8 billion 59,288 crore
Volume / market cap ratio: 0.08967
Velocity: 0.25
Vladimir Club Cost: 4.3 million 32 crore

Note:

Market cap = Current Price x Circulating Supply

Fully Diluted Market Cap is the market cap if the maximum supply was in circulation

Volume (24h) is the fiat value of this crypto traded over the last 24 hours

Dominance measures a crypto's total market capitalization relative to the total market cap of all cryptos

Volume / market cap ratio = 24h Volume / Marketcap

Velocity = 24h Volume / Circulating Supply

Vladimir Club Cost is the cost of owning 1% of 1% of an asset's "eventual" supply

RoI metrics:

Year Returns
2020 441%
2019 -23.7%
2018 -94.4%
2017 2704%

Risk metrics:

  Volatility Sharpe ratio
Last 30 days 1.05 10.27
Last 90 days 1.1 2.81
Last 1 year 1.36 2.82
Last 3 years 1.16 1.35

Note:

Volatility measures the annualized standard deviation of daily returns

Sharpe Ratio measures the excess return for a given level of risk

3. Wallets

Daedalus is a full-node desktop wallet for Cardano. It downloads a full copy of the Cardano blockchain and independently validates every transaction in its history. This provides maximum security and a trustless operation that does not rely on third-party servers.

Yoroi is a light wallet for Cardano that does not require downloading the blockchain. It is available as a web-based extension and a downloadable app.

Note: The data/graphs are from CoinMarketCap, Messari, and Future Money Wallet. Figures as on 23 August 2021.

Next week: Binance Coin

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Rohas Nagpal is an author, an amateur boxer, a blockchain architect, a Tintinologist and a retired hacker.

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