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Cardano’s TVL Ranking Jumped From 34th to 15th as ADA Price Failed to Keep Up

Last Updated November 17, 2023 12:55 PM
Josh Adams
Last Updated November 17, 2023 12:55 PM
Key Takeaways
  • Cardano has a lot to brag about this year, according to a new report.
  • Its total value locked has exploded over the last year.
  • However, ADA’s price has failed to keep pace.

According to a new report  by Messari, while crypto prices declined across the board in 2022, one blockchain bucked the trend. Cardano’s total value locked (TVL) spiked by over 198% year-to-date, propelling it from 34th in TVL rankings to 15th. Although, as of November 17, Cardano actually sits at number 12, according to DefiLlama .

The boost comes thanks to a wave of new decentralized finance (DeFi) protocols launching on the network. Over half of Cardano’s $157 million TVL now comes from DeFi apps introduced within the past year.

Cardano TVL Blossomed In 2023

Leading the charge is the synthetic asset platform Indigo Protocol. Its TVL sits just behind the decentralized exchange (DEX) Minswap at $37 million after launching the iETH token in June. That innovation allowed Cardano users to gain ETH exposure and hedge against further ADA declines.

Indigo’s overcollateralized stablecoin, iUSD, also drove TVL growth. Its market cap doubled quarter-over-quarter. Other native stablecoins like DJED further boosted liquidity for Cardano Defi apps.

Cardano's ecosystem has had a good year thus far.
Source: Messari.

Wanchain then connected the ecosystem to major external assets like BTC and top stablecoins USDT and USDC. That interoperability unlocked even more liquidity from outside chains.

The fresh liquidity powered Cardano’s TVL up the rankings even as its native token, ADA, shed nearly 10% of its value last quarter. Staking metrics also held strong, with engaged stake reaching 65.3% of the circulating supply.

Beyond DeFi

Beyond DeFi, Cardano’s layer 2 scaling solution Hydra continues to progress. September saw the first mainnet transactions processed through its “Head” state channel. Payment apps and games built on Hydra could soon drive more on-chain activity.

On the protocol layer, nodes activated the Mithril network. It produces “light” snapshots of Cardano’s state that streamline access for light clients. That improves sync speeds and enables use cases like efficient voting systems.

Governance also advanced with a new testnet called SanchoNet. Groups can trial on-chain voting schemes there before proposing changes to Cardano’s parameters or treasury.

Speaking of the treasury, September saw $1.6 million awarded to 192 projects in Project Catalyst’s 10th funding round. In total, the community has now funded over 1,300 proposals through Catalyst grants.

With new DeFi flowing in, scaling solutions launching, and governance expanding, Cardano’s ecosystem has a lot to shout about. If bulls return in 2023, the end-of-year and beginning of 2024 could be a period of prolonged growth for the community and ecosystem.

Cardano’s Price Has Failed To Keep Up

Whilst Cardano’s TVL has seen a successful trajectory in 2023, its token, ADA, has left less to brag about. 

Like most cryptocurrencies, ADA currently trades far below its 2021 highs, down 88%, according to CoinMarketCap . Over the past year, ADA prices rose only 14.40%, while Bitcoin soared 119.90%, Ethereum climbed 64.14%, and Avalanche spiked 67.24%. Solana even jumped 311.96%. 

Cardano's TVL has outpaced ADA's price.
Cardano’s (ADA) price performance over the last 12 months. Source: CoinMarketCap.

Cradano’s ADA wasn’t the only poor performer among the big cap cryptos. BNB has had less than a stellar year, dropping 8.49%.

Much of ADA’s failure to keep pace traces back to a monumental price collapse in June. At that time, the U.S. Securities and Exchange Commission opened two new cases against Coinbase  and Binance  regarding security classifications. Then on June 9th, citing legal uncertainty, Robinhood announced the complete delisting of ADA and other tokens from its platform. The news sent ADA prices plunging 30% in a day. And unlike other cryptos, ADA has yet to stage enough upside recoveries to compete with its competitors’ gains.

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