General market turmoil last year crushed the cryptocurrency market, wiping out about $2 trillion in value. When investors worry about the economy, they usually head to safer assets and leave the riskier stuff for another day. Crypto, as a newish industry, is risky because we don't know exactly what the industry will look like years down the road -- even if it seems promising.
But better days for crypto might be on the horizon. That's because a bull market is coming. Of course, we can't predict exactly when it will arrive. History does tell us, though, that bull markets always follow bear markets. And in the favorable and optimistic conditions of a bull market, crypto could soar. To prepare, here's one cryptocurrency to buy now.
Something in common with Ethereum
And that player to buy is Cardano (ADA -5.36%). Cardano has something in common with Ethereum, the world's second-biggest cryptocurrency. Ethereum co-founder Charles Hoskinson also created Cardano.
Ethereum is already a successful blockchain, leading in the worlds of decentralized applications (dApps) and nonfungible tokens (NFTs). But Hoskinson aims to make Cardano even better. The Cardano team is working to make this younger blockchain a stronger player when it comes to decentralization, scalability, and security.
To do this, Cardano software engineers use peer review. That means they publish details about upcoming plans and seek thoughts from fellow experts before launching updates. The one big disadvantage is that this makes Cardano slower than its rivals. But the advantage is that it leads to fewer glitches -- and makes Cardano a blockchain you can count on.
All of this is winning over users. Cardano recently reached a record high in total value locked of more than 365 million Ada ($136 million), its native token, according to DeFiLama. That represents the value of assets staked in the system.
Cardano enabled smart contract functionality back in 2021. Since then, the creation of these contracts using Cardano's Plutus language has been on the rise. In fact, over the past year, Plutus scripts have increased about 200% to more than 5,000, Cardano Fans Stake Pool data show.
Finally, Electric Capital's annual developer report also supports the idea that more and more users are flocking to Cardano. The platform saw a 16% increase in full-time developers last year.
The Hydra head project
And Cardano's progress is far from over. Software engineers are working on an exciting project that could make Cardano one of the fastest and most efficient blockchains out there. This is through the creation of Hydra heads, small off-chain ledgers that handle certain operations. This will avoid congestion on the main network -- and boost the volume of data handled and speed.
Cardano hasn't offered a release date for the Hydra project, but the launch clearly could be a huge step for this young crypto player.
Now, let's take a look at Cardano's performance. The crypto has gained some momentum this year, advancing about 50% to nearly 40 cents. Back in 2021, Cardano's price peaked at more than $2.90. I think that if Cardano continues to gain users and successfully launches Hydra, it can get back to that level -- and surpass it over time.
Of course, cryptocurrency remains a risky sector, as I mentioned above. So, you shouldn't invest more than you can afford to lose. But if you do want to bet on this innovative industry, Cardano makes a great choice. This player has what it takes to stand out over time -- and today's price offers you a very reasonable entry point.
