- Cardano’s TVL surpassed $700 million, with $1 billion as the next target.
- Will strong network growth increase ADA’s value?
Cardanos [ADA] November’s impressive rally was supported by strong fundamentals and confidence, as TVL (Total Value Locked) rose to record highs of $713 million.
This was a huge recovery from the nearly $500 million hit in the last cycle.
Source: DeFiLlama
Cardano TVL increases
For the unfamiliar, TVL tracks the amount of money locked on chain, specifically the DeFi protocols on the Cardano network. In line with this, an increase in the TVL indicates improved investor confidence.
According to DeFiLlama, the main protocols powering Cardano TVL were two lending platforms: Liqwid, Indigo, and the decentralized exchange (DEX), Minswap. They owned more than 50% of TVL ($430 million) at the time of writing.
Network growth was also evident as DEX (decentralized exchange) volume rose to annual highs.
Cardano DEX (orange) trading volume was just $1.9 million at the beginning of November, but at the time of writing this increased to $31.5 million. That’s a whopping 17x growth in a month.
Source: Artemis
The increased DEX trading volume meant more user activity, which positively correlated with the strong price action in ADA over the past month.
It is striking that the number of users has increased from 30,000 at the beginning of November to almost 90,000 at the time of writing, an increase of 100%. On the price front, ADA rose 272% over the same period, reaching a yearly high of $1.3.
ADA price promotion
So, rising DEX volume and overall network growth could fuel ADA’s attempt to keep an eye on the $3 cycle high in 2021 if the trend continues in the coming weeks or months.
ADA’s prospects of reaching 2021 highs on the price charts could only be validated if the price were to remain above $1 and reach a clear $1.5 range high in the last cycle.
The recent price pump pushed the altcoin into a price range of $1-$1.5 formed in 2021. ADA consolidated in the range for three months before a breakout that reached $3.
Source: ADA/USDT, TradingView
Read Cardano [ADA] Price forecast 2024-2025
If the pattern repeats, the ADA price could fluctuate between $1 and $1.5 in the coming weeks.
In conclusion, the recent ADA price increase was not a FOMO affair in the market; strong fundamentals also played a role.
