By any standard, 2022 has not been a good year for Cardano (ADA 4.86%), which is currently trading for just $0.31. The crypto is down nearly 77% year to date, and 90% from its all-time-high of $3.10 in 2021. Despite a series of positive news announcements in recent months, Cardano has been having real trouble gaining traction with investors in a market preoccupied with contagion from the collapse of crypto exchange FTX.

But I still think there's a lot to like about Cardano, which looks to be tremendously undervalued right now. Heading into 2023, Cardano is one cryptocurrency I would buy before the rest of the market wakes up to the value it offers.

Organic growth

First and most importantly, Cardano has been showing strong signs of organic growth, despite the onset of a crypto winter. According to the latest metrics, Cardano now leads all blockchains in terms of overall development activity. Moreover, Cardano has posted impressive gains in key metrics like daily active users.

A gold coin with the word "crypto" on it.

Image source: Getty Images.

Much of this burst in recent activity has been made possible by a string of recent technological upgrades, including the Alonzo upgrade in 2021 and the Vasil upgrade in September of this year. These upgrades are making it easier and more attractive to develop on the Cardano blockchain. They have also introduced potential new use cases for Cardano. The past two upgrades are particularly important because they introduced smart contracts to Cardano, which could power a new round of innovation related to decentralized finance (DeFi).

New offerings and features

At its developers summit last month, Cardano unveiled a new set of features and offerings that will accompany the next stage in its development, known as Voltaire. The one offering that is getting the most buzz is the release of two new stablecoins for the Cardano ecosystem. Since stablecoins are core to the development of DeFi, this is actually huge news for Cardano. DeFi is one area where Cardano is playing catch-up, so it can become a high-visibility area to display some quick wins.

Cardano also appears to be strengthening its position in a number of other areas where it has historically trailed market leaders such as Ethereum. One good example is the non-fungible token (NFT) market, where a spate of recent activity has propelled Cardano to the No. 3 spot in terms of overall trading volume. 

Why is Cardano so polarizing?

Given all of these developments, it's only natural to ask: Why haven't investors been more receptive to Cardano? The easiest answer is that Cardano has always played the long game. It has focused on slow, steady development and an academic approach to building a safe, secure, and stable blockchain. It doesn't have a team of high-profile venture capital backers trying to get Cardano to explode out of the gate. 

As a result, it can sometimes be frustrating to hold Cardano. If you think about the broader crypto market, it somehow seems inconceivable that the all-time-high for Cardano is just north of $3. It has never had the sort of stratospheric launch into orbit that attracted get-rich-quick crypto investors. Add in the fact that Cardano co-founder Charles Hoskinson is known for his prickly replies to anyone complaining about the slow pace of development, and it's easy to see why Cardano can be so polarizing.

Cardano is a long-term buy

While Cardano doesn't have the explosive upside of other cryptos, it is a trusted blockchain project that dates back to 2017. It has a very transparent roadmap for future development, a passionate community of developers, a visionary leader (Hoskinson helped to co-found Ethereum as well), and a measured, risk-averse approach to blockchain development. Best of all, Cardano has a lot of exciting projects on the way for 2023, which gives it more than enough upside to be interesting over the long term. 

Based on the above, Cardano seems to be significantly undervalued. As soon as Cardano's new foray into DeFi starts to pick up speed, I think investors will finally see some upward price pressure for Cardano. In fact, some traders are already anticipating that Cardano could hit $5 within the next 12 months. The time to buy Cardano is now, when investors have not yet woken up to the hidden value about to be unlocked by the world's ninth-largest cryptocurrency.