Have you been wondering the answer to the question, "Is it too late to buy/invest in Cardano?"
If you have, then you're in the right place.
The recent rally of Cardano's token price has crypto investors wondering whether it is too late to invest in the project.
This guide will explain why Cardano might be your best crypto investment in 2022 and beyond.
We have also compiled a complete walkthrough on how you can buy the ADA tokens in 4 minutes.
If you just want to invest in Cardano ADA, you can do so on Coinbase here >>
What Is Cardano (ADA)?
Cardano is an open-source blockchain that allows the settlement of payments. It aims to build a more scalable decentralized finance ecosystem using its native cryptocurrency ADA to power the platform.
Recently, controversy has surrounded the project as analysts and investors circled that Cardano-native smart contracts cannot support DeFi applications at scale right now.
However, Cardano plans to solve the issue with its layer two solutions, similar to Ethereum's 2.0 upgrade.
Also, unlike Ethereum and Bitcoin, Cardano uses less energy, thanks to its Proof-of-Stake (PoS) architecture, which allows token holders to stake ADA for the right to verify transaction blocks.
What Makes Cardano Unique?
The main difference between other cryptocurrencies and dozens of other PoS projects is that it is fully open-source.
That is because Cardano aims to be a scientifically peer-reviewed blockchain, using the best practices for an optimal crypto ecosystem.
To achieve this feature, Cardano has a layered architecture.
The Cardano blockchain consists of:
- Cardano's Computational Layer (CCL) - allows the deployment of smart contracts and network governance.
- Cardano's Settlement Layer (CSL) - This layer facilitates all transactions on the network.
The beauty of this architecture is that the layers can interoperate and communicate smoothly.
But at the same time, they function independently, allowing transactions even while the network computes smart contracts or experiences updates.
The Ouroboros Proof of Stake Mechanism
The second unique aspect of Cardano is its consensus mechanism called Ouroboros Proof of Stake. In case you haven't heard of it, Ouroboros is a validation system where users can become complete node validators or delegate their stakes to other users to validate transactions for them.
In the mechanism, time is divided, and for each period, a new set of validators are voted in and allowed by the system.
This division of labor promotes diversity and decentralization of the validator pool.
Validators are rewarded with new ADA tokens distributed to everyone who staked, creating passive income.
Here's a quick reminder of Proof of Stake vs. Proof of Work:
What Are The Benefits of Cardano?
If you are familiar with blockchain, you know that every blockchain suffers from a trilemma.
Unlike the client-server user relationship with which centralized networks function, public blockchain networks are decentralized. The nodes are managed in a widely distributed network to achieve a general data agreement.
While doing all that, the blockchain still has to maintain transparency, equitability, and open access. That is a challenge!
For example, while Bitcoin is decentralized and secure, it can only transact about seven transactions per second (TPS).
Blockchains that are fast and decentralized but unscalable or insecure are untenable in the long term. This trilemma is an issue Cardano aims to solve.
Charles Hoskinson, Cardano's founder, created the project to be scalable, and at the moment, it provides about 250+ transactions per second, compared to Ethereum's 15.
Cardano also offers cheaper gas and transaction fees. That is a significant benefit as it will attract developers to the platform once their Layer 2 solutions are applied.
Should I Invest In ADA?
Recent market factors and developments have made the Cardano project more widely used in the crypto community.
Looking at the charts, 2021 was by far Cardano's best year yet.
Although ADA started the year with a low price of $0.18, by February, it had exceeded $1 for the first time since 2018 and hit $2.41 by May.
After that, ADA, along with the crypto market, dipped, and by late July, it had hit an all-time low of $1.05.
However, the coin's value rebounded with an upward trend, thanks to the implementation of the "Alonzo" hard fork that has given the platform smart contract compatibility.
They just need to fix their scalability, and developers will be rushing to the platform.
Nevertheless, considering the cryptocurrency's steady upward trend, high utility, extensive adoption, and massive DeFi potential, Cardano could be one project worth investing in, despite the current bear market.
How Can I Buy Cardano (ADA)?
Currently the number sixth on Coinmarketcap, the ADA token is one of the most traded cryptocurrencies with a circulating supply of over 33.4 billion out of the maximum of 45 billion.
Presently, ADA is listed on top exchanges like Binance, Coinbase, Crypto.com, and even Uphold.
That said, our recommendation, however, is the SEC-approved eToro platform.
Aside from being safe for investors, the exchange platform is almost unrivaled in the arsenal of analytical tools it provides.
To buy ADA tokens on the eToro exchange, follow these steps:
- Sign up: Go to eToro.com, create an account, fill in your KYC details, and confirm the process.
- Make a deposit: Use the best-suited option to transfer currency into the platform. That could include fiat, stable coins, ETH, or Bitcoin.
- Search for ADA: After that, navigate to the trade section. You will need to select the currency pair you want to exchange for the coin and click the Buy button.
The purchased ADA coins will be sent to your wallet on the exchange.
Where To Store Your Cardano
There are a number of ways to store your Cardano. Of course, you can leave it on the exchange - but we don't ever recommend that if you're not trading.
Instead, you should store your crypto in a hardware wallet that you control.
Both Ledger and Trezor support ADA, and they are on our list of recommended crypto wallets.
That said, even with your hardware wallet, you'll need to use a tool like ADAlite to connect with your wallet.
Final Thoughts
First of all, it's worth noting that the tokens' value primarily depends on their relevance in the crypto market.
Aside from that, some speculate that Cardano will be an alternative payment method to Bitcoin; however, the token competes more with Ethereum.
And despite hitting an all-time high of $3.10 this year, certain factors continue to show that it's bound to grow more.
One of such factors is Cardano's eco-friendly proof of stake (PoS) consensus model, which helps to keep the network lightweight.
Aside from that, it is one of blockchain's most secured chains right now.
Therefore, now may be the best time to buy the ADA coin before another bullish market kicks in.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.