ADA-USD: Don’t Read Too Much Into BitPay Poll Snub of Cardano
In the “what does it mean” category, I ran across a bit of news surrounding Cardano (CCC:ADA-USD). Specifically, the native cryptocurrency that powers the first third-generation blockchain was not successful in becoming the next altcoin to be listed on BitPay.
If you’re not familiar, BitPay ran a Twitter (NYSE:TWTR) poll asking which cryptocurrency should be the next one to be integrated into its wallet app. Cardano, and by extension ADA, was one of 20 possible options. As my headline indicates, Cardano was not successful losing to Shiba Inu (CCC:SHIB-USD) and its vaunted SHIB army.
Once the result was announced, Cardano founder Charles Hoskinson questioned the point of the poll. It may sound like sour grapes, but I think it does raise a fundamental question.
On the one hand, the answer would seem to be self-evident. BitPay is the largest cryptocurrency payment company. Any cryptocurrency would want to make the list of cryptocurrencies accepted by BitPay-supported merchants.
However, I can’t help but think that this had nothing to do with merit. BitPay was running a popularity contest. A chance to nominate someone as the Homecoming King. In this poll, Shiba Inu won, tomorrow it could be Cardano.
The question is would that be the best outcome for Cardano?
It’s About Value Beyond Cardano’s Price
I’ve admired Cardano for, so far, applying a laser focus to the idea of creating utility for its blockchain platform. Now, I’m not saying that Shiba Inu or any of the other altcoins is not attempting to do the same thing. However, it’s clear that Cardano has taken a very measured approach to deliver meaningful innovation that creates a value beyond price.
Some may say that the platform has been too measured in its approach. In fact, the Cardano network is not officially launched yet. The network was deliberately planned to launch in five phases each focusing on a specific aspect of the network. The blockchain recently completed the third phase, Gougen, that enables smart contracts. This leaves two additional phases: one covering scalability, the other addressing governance.
This is accomplishing at least one thing. Cardano is demonstrating an ability to attract developers. This will be crucial if Cardano is to succeed in perhaps overtaking Ethereum (CCC:ETH-USD) in terms of utility. And if it does, it won’t because of price; the price will come along for the ride.
Because as I wrote in a prior article back in June, “If price is the only thing that novice investors have to focus on, then it’s tough for any altcoin to stand out.”
Cardano May Benefit From Staying Under the Radar
Last week, I attempted to make an argument about the unintended consequence of community in the ascent of cryptocurrency. While the primary focus of my article was Shiba Inu, it could just as easily relate to Cardano.
Essentially, my reasoning is that as cryptocurrency gains mainstream adoption, it’s going to attract more mainstream investors. And as I summarized, it makes me wonder if mainstream adoption will make “innovative” altcoins less attractive to the early adopters.
Which brings me back to Cardano and the BitPay kerfuffle. I’ll throw a nod to my InvestorPlace colleague Will Ashworth who encouraged Cardano to stay true to its North Star. He wrote, “By focusing exclusively on Cardano’s essential utility, I see it landing on the winning side of history.”
Or put another way, Cardano may have lost this minor battle, but I’m not sure it’s a battle it wanted to win to begin with. That leaves it in a good position to win the war for hearts and minds of true believers.
On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris Markoch is a freelance financial copywriter who has been covering the market for seven years. He has been writing for InvestorPlace since 2019.