A recent announcement by the CEO of Cardano helped raise investor interest in three cryptocurrencies. In this video clip from “The Crypto Show” on Motley Fool Live, recorded on March 23, Fool.com contributors Chris MacDonald and Travis Hoium discuss some of the future competition between Cardano ( ADA -0.74% ), Solana ( SOL 1.49% ), and Avalanche ( AVAX -4.00% ).
Chris MacDonald: There’s a quote in here from Charles Hoskinson, who’s the CEO or the founder of Cardano. He is focusing right now on a number of networks and the updates on the Cardano network that are underway that are supposed to be rolled out between June and October of this year.
Some investors are getting pretty excited about Cardano from this perspective. His quote here says, “This year all these updates are coming that are massively improving the scalability and expressiveness of the system, so that you’ll get the same type of performance you are seeing from systems like Solana and so forth, or at least in the same orders of magnitude.”
I think Cardano is the outperformer right now given that these comments are rather bullish from a scalability standpoint. I think that really is what’s being focused on for Cardano and a lot of these old coin networks is doing the maximum amount of throughput at the lowest cost. It’s kind of a race to the bottom or the race to be the fastest network out there. Cardano is making some strides there.
Additionally, so the key point that I would drive home about these three tokens, this news came out about a week ago, but Grayscale is adding a smart contract fund, and three of its largest positions are Cardano, Solana, and Avalanche. It seems like investors are pricing in more capital flows into these tokens, so greater liquidity, more demand, and the potential for other funds to jump on this trade.
Personally, this is an area of the market that I’m looking at. This is an interesting fund and the announcement I think boosted these tokens significantly. From here, it will be interesting to see how they trade.
Travis Hoium: Yeah. The other thing to add to that is that over the last week we’ve seen some reliability issues on the Solana network. There is sort of these growing pains going on, as well as they try to improve the networks.
Developers are building utility, things like NFTs, decentralized finance. Solana specifically has grown so quickly that it does have these growing pains and Cardano is trying to answer that with their own solutions. It’ll be interesting to see how this battle plays out.
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