- Network revenues increased while active addresses increased.
- Transactions on Cardano DApps continue to increase, indicating an increase in the value of ADA.
Although Cardano [ADA] went through several phases of struggle in 2023, Messari’s recent report shows that the fourth quarter (Q4) brought some relief. One area where the Cardano network excelled was revenue. According to the reportproject revenues increased by 66.7% quarter on quarter (QoQ).
During the period mentioned above, Cardano’s revenue grew to $1.43 billion. AMBCrypto identified two reasons why sales increased.
First, ADA’s price performed great this quarter. In addition, there was also an increase in transaction costs as activity on the network increased. The report read:
“Average transaction fees (USD) increased 50.4% quarter-over-quarter from $0.10 to $0.15. The disparity also indicates that ADA’s price action was almost entirely responsible for the USD increase.”
Starting slowly is not the end
This year, ADA’s price started slowly. But in the past seven days, the price has risen 10.90%, indicating that the token can still contribute immensely to revenue in the first quarter of 2024.
Furthermore, the fourth quarter of 2023 saw an increase in the average number of daily transactions.
There was a 1.6% quarter-on-quarter growth in active addresses and a 10.9% increase in transactions. The increase in the number of transactions was a testament to the usefulness on the Cardano network. As for the reasons for the jump, Messari explained that:
“The increased average activity per user could be a result of all the newly launched and developed protocols in 2023 – especially DeFi protocols.”
Previously, AMBCrypto mentioned that Cardano’s Total Value Locked (TVL). However, the recent report provided in-depth details on what prompted the increase.
The TVL measures the overall health of an ecosystem by considering liquidity deposits and activities with decentralized applications (DApps) built underneath.
Source: Messari
There may be more in store for ADA
For Cardano, there were two main drivers for his TVL. First, it was Miniswap, the Automated Market Maker (AMM). The second was Liqwid Finance, a lending and liquid staking protocol.
Based on the report, transactions on Miniswap increased by 140% during the quarter. Liqwid Finance also registered a large increase in transaction volume.
AMBCrypto analyzed whether the DApps had maintained similar momentum. According to data from DeFiLlamawe noticed that Miniswap and Liqwid’s TVLs were up 13.08% and 23.34% respectively over the past 30 days.
Source: Messari
If market participants continue to believe in these protocols, Cardano’s TVL could peak again before the end of the first quarter of 2024.
However, not every part of the Cardano ecosystem experienced growth. For example, the number of stake pools remained stable, but decreased by 0.06%.
Staking also affects the price of ADA, as the native token can be used to register a staking pool. We recently mentioned that ADA could have the potential to reach $1.
How much are 1,10,100 ADAs worth today?
But beyond the technical outlook, an increase in the token’s usage could positively impact the price action.
If betting activity on Cardano changes for the better, ADA’s price could move closer to $1. If not, the cryptocurrency may not reach the milestone in the first quarter.