On March 2, President Donald Trump mentioned Cardano exists (Ada) Token in cryptocurrencies to be included in the US strategic crypto reserve. Trump’s March 6 Executive order It is clear that the altcoins will be part of the digital asset stockpile (DAS) under the “responsible steward” of the treasury.
Ada’s potential integration with a government -governed portfolio has brought surprise throughout the industry and, at times, harsh criticism. Although it has a loyal investor who has supported it for many years, many in the crypto community have asked why the token includes the digital asset stockpile.
Let’s check the blockchain to see if the ADA and utility basis supports its place in the US digital asset stockpile.
The case for ADA in US digital asset stockpile
Launched in 2017 by an ICO, Cardano is one of the oldest platforms of the wise contract. This differs from others through the design approach driven by research and its use of a delegated proof-of-stake mechanism combined with an extended UTXO accounting model.
Cardano’s ambition as a smart contract platform is well Nakunan By X ‘Cardano_whale,’ which drafted the “unstable blockchain fees, voting power, decentralized consensus, all folk token trade paired here.”
The X Post emphasizes ADA’s utility (something “Most VC coins”) along with Cardano’s decentralized management as the main benefit.
In fact, Cardano’s Project Catalyst is one of the largest decentralized funding initiatives in crypto. Through this, Treasury funds from transaction and inflation fees are democratic to community measures. Also, unlike the Ethereum Network, which still relies on Offchain managing for major upgrades, Cardano aims to move fully with onchain management.
The Plomin hard fork That happened on January 29 and the move to the “full decentralized management,” according to the Cardano Foundation. It gives ADA holders “true voting power – to parameter changes, Treasury removal, hard forks, and future blockchain.”
Cardano’s native coins, ADA, are used for network fees, staking, and management. Its highest supply is 45 billion, with 31 billion first distributed – 26 billion sold on public sale and 5 billion allocated to IOHK, Emurgo, and the Cardano Foundation.
The remaining 14 billion ADA is reserved for gradual release by mininting. By 0.3% of ADA reserves distributed as rewards every five days, ADA inflation refused as the reserves were depleted. The current inflation rate is approximately 4%, with a circulating -transfer supply of 35.95 billion ADA.
While a capable supply can support the cost of a coin and justify its integration with DAS, other ADA metrics, such as fees and staking yields, which are far behind competitors.
Should Cardano activity raise?
Despite its years in the intelligent contract ecosystem, Cardano struggles to produce sufficient activity to promote himself with the leaders. As a result, the limited use of ADA within the crypto ecosystem has increased concerns about its long -term value.
According to Q4 2024 of Messari Cardano state Report, the blockchain processed an average of 71,500 days -day transactions, with 42,900 days -day active address. Quarterly fees cost $ 1.8 million, a contrast contrast to $ 552 million of Ethereum in fees at the same time, according to Co ringecko.
Cardano’s annual real yield, which suits inflation, is approximately 0.7% in Q4, compared to Ethereum’s 2.73%.
General -Cardano Key Metrics, Q4 2024. Source: Mesari
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Other metrics of blockchain activity reinforce recalls about adding ADA to a government portfolio:
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Of the 449 developers working on the blockchain, Cardano is on the 12th in blockchains in developer count, according to Electric Capital’s Report.
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Its part of stablecoins’ is only 0.01% of the total $ 224 billion stablecoin market cap, per Delete.
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Cardano’s defi ecosystem is not prosperous, worth only 0.3% of the $ 169 billion defi sector. However, if we include its core staking, which does not require locked and therefore does not count on TVL, Cardano’s part will grow by 12%.
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Cardano’s DAPP activity remains low compared to other wise contract platforms. In Q4, it only averaged 14,300 days -day transactions to DAPP -out of the top 25 and a portion of Solana’s 22 million. Although more about 73% decline from Q4 2023, when Cardano recorded 52,700 days -day transactions. Such a sharp drop indicates a disturbing trend for a blockchain that is still in its stage.
Cardano transactions DAPP, Q4 2024. Source: Mesari
Is Ada’s potential enough to justify an investment in the US government?
The case for ADA in the strategic crypto reserve is less clear than Ethereum and Solana, which leads to blockchains in many different categories. Cardano’s low activity, limited adoption, and vulnerable staking incentives adds a serious doubt about Ada’s suitability for a government-operated pool.
On the other hand, ADA’s capped supply and Cardano’s focus on decentralization give it a unique edge to competitors. They can lead to greater adoption and relationship in the long run.
Moreover, projects such as Yun Through the atrium lab explored Cardano’s native compatibility with Bitcoin through the Eutxo system, which could potentially unlock a new framework for Defi in Bitcoin and drive cardano activity.
Can this possibility be sufficient to justify the ADA area in the stockpile of digital assets?
As David Nage, the portfolio manager of venture capital firm Arca, Put it,
“Like the rest of the crypto, the Cardano ecosystem needs to search and support developers to create products and applications that are million -million people enjoy and dependent.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
