In a post on X, Cardano analyst Yoda believe that a stablecoin pegged to the USD is crucial to the future success of ADA, suggesting that its integration could trigger a bull run sometime in 2025.
A stablecoin, a token that is “stable” as its price is pegged to a fiat currency such as the US dollar or euro, will drive activity, further boosting decentralized finance (DeFi) and even token activities. non-fungible (nft). With a popular stablecoin like USDT or USDC implemented on the proof-of-stake blockchain, the number of users interacting with Cardano dapps will likely increase, catalyzing demand as ADA is used to pay fees.
Stablecoins, ticket backers and Hydra could prop up Cardano in the long term
The presence of a high market cap stablecoin can facilitate smooth transfers of value and reduce volatility. Networks like ethereum, Tron, and Solana have already been more active as network users mint billions of stablecoins like USDT, USDC, USDD, and even DAI. For this reason, their respective DeFi and nft ecosystems have a higher total value locked (TVL) with individual protocols managing billions of dollars.
To illustrate, DeFiLlama data ethereum” target=”_blank” rel=”noopener nofollow”>sample that the ethereum and Solana DeFi ecosystems have a TVL of $32 billion and $1.3 billion, respectively. Meanwhile, although improving, Cardano has a TVL of $337 million. For context, one of ethereum's largest DeFi protocols that facilitates stablecoin trading, Curve, manages over $1.6 billion in TVL.
Beyond stablecoins, the analyst also emphasized the current development of Input Endorsers and the eventual deployment of Hydra. In the Basho stage, Cardano's lead developer IOG continues to refine the network. A key development to improve performance is input endorsers. This feature further improves on-chain scalability and transaction processing speed by introducing a parallel validation process, effectively eliminating bottlenecks.
On the other hand, Input Endorsers will be complemented by Hydra, an off-chain scaling solution similar to ethereum's Layer 2 approach. Through Hydra, IOG said Cardano will scale horizontally while remaining secure and decentralized.
Going cross-chain, ADA will find support at $0.50
These moves could support ADA prices in the coming days. Cardano is already looking to expand its ecosystem. In November 2023, associated with Polkadot, a cross-chain platform.
This partnership will provide a means for seamless communication and asset transfers. At the same time, the resulting interconnection and interoperability can further drive adoption, boosting the two ecosystems.
So far, ADA remains stable and finds support around the $0.50 area. Technically, the bullish trend continues. However, to overcome the current bull flag, there must be a sharp move above $0.55 with increasing trading volume.
Featured image from Canva, TradingView chart
