Millions of dollars flow into Cardano ahead of Alonzo hard fork
- Cardano price movements can be explained by the potential of an upcoming smart contract upgrade by mid-September.
- Cardano-focused investment products recorded inflows of $1.3 million ahead of the Alonzo hard fork event.
- Trader optimism is reflected in the prediction market where 80% of bets favor Cardano.
Cardano has rallied 14% in the past week due to increasing institutional investment ahead of the Alonzo upgrade. Though tech timelines are challenging to predict, the Cardano team has set a date for the launch of smart contract functionality on the mainnet as mid-September.
Cardano ranks third in market capitalization, replacing Tether
Cardano replaced the stablecoin USD Tether to become the third-largest cryptocurrency by market capitalization. At the time of writing, ADA price is $2.01, and the market cap has crossed $64 billion.
Cardano's upcoming smart contract launch has attracted an increased inflow of capital from institutions. Cardano investment products observed a rise of $1.3 million in inflows when the top two cryptocurrencies, Bitcoin and Ethereum, noted outflows of nearly $22 million.
Input Output Hong Kong (IOHK), the decentralized blockchain company behind Cardano, recently announced that the team is on track to meet the projected hard fork dates for its testnet and mainnet. IOHK shared the update on Twitter
#Cardano #smartcontracts are coming...
— Input Output (@InputOutputHK) August 17, 2021
We're on track to meet the projected HF dates for both testnet & mainnet #Alonzo upgrade, as Nigel outlined in last week update
A new era is set to begin on Sunday 12th September 2021 $ADA pic.twitter.com/HrdrqYizhP
In their latest tech update, ADA developers pointed out that the Alonzo Purple testnet is live, and pioneers, exchanges and decentralized application developers have started testing the smart contract functionality.
Interestingly, Cardano's Alonzo hard fork and smart rollout of smart contracts on the mainnet take it a step further than Ethereum. IOHK labels Cardano as the "Green Blockchain." While rival Ethereum is months away from a shift in consensus mechanism and mining, Cardano and other proof-of-stake protocols are claiming that they have arrived at the solution.
Investors are taking note of Cardano’s readiness for replacing energy intensive cryptocurrencies and buying ahead of the next big upgrade on the altcoin’s blockchain. The open bet on Polymarket against the launch of smart contracts before October 1, 2021, is now in favor of Cardano. Odds are 80-20 versus 63-37 four weeks ago.
Experts have attributed Cardano's meteoric rise to the mid-September launch. Michaël van de Poppe, the CEO and co-founder of Eight Global, analyzed the probability of ADA hitting $5:
#Cardano ready for $5 after a big breakout?
— Michaël van de Poppe (@CryptoMichNL) August 11, 2021
Seems likely.
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FXStreet analysts state that ADA has what it takes to hit another all-time high. Cardano is well-positioned for hitting new highs, and the ADA rally is set to continue as the price holds above $1.90.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
