Decided Cardano is safe for your risk tolerance? You can get ADA on eToro!
Cardano (ADA) is a blockchain platform that claims its goal is to create a society that is more secure, fair and transparent. Cardano launched its Alonzo hard-fork in August 2021, which aims to support smart contract functionality on chain, although smart contract application is still in roll-out stages. With the depegging of Terra pushing back the progress of the crypto sector, tokens like Cardano may seem more functional and useful than ever. Yes, smart contracts will make the platform more functional, but the crypto market at-large has quite a lot of competition, and market risk can be quite high depending on how the token is performing.
How is Cardano Secured?
Cardano uses the proof-of-stake (PoS) Ouroboros Praos protocol to facilitate consensus on its blockchain. This protocol is known to be much more sustainable than traditional protocols, claiming to be 4 times more energy efficient than Bitcoin. With this PoS protocol, participants in the network are rewarded for their involvement with a small amount of ADA.
Risks of Investing in Cardano
Like most cryptocurrencies, Cardano is another extremely volatile asset whose value is widely speculated. Most of the real value behind Cardano is within the Alonzo hard-fork and the roll-out of smart contracts. The risk of the project being overvalued implies a correction of current market price considering that Cardano has a market cap in the tens of billions.
Is Cardano Safe?
Generally speaking, Cardano is a fundamentally safe investment. However, just like other cryptocurrency, ADA is volatile and considered high risk by traditional standards. The team is considered reputable in the blockchain space, with founder Charles Hoskinson being a co-founder of Ethereum. Also, considering the project is a Layer 1, ADA is a coin on its own blockchain independent of other projects. It offers many options when it comes to staking, allowing traders to earn passive rewards while holding their ADA in staking pools.
Where to Invest in Cardano
You can buy Cardano on many exchanges including eToro, Coinbase Global Inc. (NASDAQ: COIN) and SoFi. A digital asset exchange like one of these options is a great way for traders to start buying in the cryptocurrency market. Remember, too, that the crypto market is quite diverse and certain exchanges may not support the tokens in which you want to invest.
- securely through Coinbase's websiteBest For:Coinbase Learn
Sum of median estimated savings and rewards earned, per user in 2021 across multiple Coinbase programs (excluding sweepstakes). This amount includes fee waivers from Coinbase One (excluding the subscription cost), rewards from Coinbase Card, and staking rewards. ³Crypto rewards is an optional Coinbase offer. Upon purchase of USDC, you will be automatically opted in to rewards. If you’d like to opt out or learn more about rewards, you can click here. The rewards rate is subject to change and can vary by region. Customers will be able to see the latest applicable rates directly within their accounts.
- securely through eToro's websiteBest For:Demo Accounts
Don’t invest unless you’re prepare to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins and learn more. Cryptocurrency is offered by eToro USA LLC (“the MSB”) (NMLS: 1769299) and is not FDIC or SIPC insured. Investing involves risk.
Best Hardware Wallet for Cardano
When owning a digital asset like cryptocurrency, it is often smart to get a hardware wallet to keep your private keys safe. A crypto wallet protects your investment and integrates seamlessly with blockchain technology to ensure instant access to your investments without leaving them open to hackers.
Best Hardware Wallet: Ledger
Ledger is the most credited hardware wallet currently available. The device is primarily an offline hardware wallet. Ledger also connects to Bluetooth and USB, depending on whether you want to use your computer or mobile device. Ledger’s app also makes it easy to secure and manage your assets.
Keep a look out for the Cardano smart contracts utility, as it has yet to be built out on the platform. It will be a bullish indication when developers begin building on Cardano.
Cryptocurrency Market Outlook
The current market sentiment of crypto seems to be bullish, although it will depend heavily on the price of Bitcoin within the coming weeks. Because the depegging of Terra made it difficult for the crypto sector to recover, you can hodl Cardano or wait until you believe it has bottomed out and buy at the dip.
Is Cardano a Safe Investment?
If you believe that ADA can successfully implement smart contracts and grow its Defi ecosystem, then the token may be a good addition to your portfolio. Cardano could also be a good way to diversify your portfolio across other Layer 1 blockchains. Nothing specific makes Cardano fundamentally more risky than other top cryptos –– it’s the utility and functionality of the chain that is questionable. Make sure to do your own research before investing in cryptocurrency, as they are very volatile assets.
Frequently Asked Questions
Is Cardano a good investment right now?
Cardano is still viable, but you must do your research and determine if it is right for your portfolio and a good investment for your money.
Is Cardano the same as Ethereum?
No, Ethereum and Cardano are not the same thing, but they were started by the same person, Charles Hoskinson.
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