Cardano (ADA) Update

Cardano Q4 2024 Report: Key Insights and Developments

Introduction

Cardano (ADA), a Proof-of-Stake (PoS) Layer-1 blockchain, was launched in 2017 with a focus on security, scalability, and functionality for decentralized applications. Supported by entities like Input Output Hong Kong (IOHK), Cardano Foundation, Intersect, and EMURGO, the network continues to evolve toward its final roadmap phase, Voltaire (Governance). With a unique development approach, Cardano utilizes the Ouroboros consensus mechanism and an extended UTXO (eUTXO) model to enhance scalability and decentralization.

Key Developments in Q4 2024

Ouroboros Peras Update

• Announced in Q4, Ouroboros Peras extends the Ouroboros Praos protocol.
• Introduces stake-based voting and a heaviest-chain selection rule to improve transaction settlement times.
• Enhances scalability through compatibility with Hydra and Mithril.
• Developed with IOHK's research-driven approach in collaboration with the Cardano community.

Chang Hard Fork (Governance Upgrade)

• A two-phase upgrade designed to implement full onchain governance as part of the Voltaire phase.
• Phase One (September 2024): Introduced a technical bootstrapping phase for decentralized voting.
• Phase Two (Plomin Upgrade) (January 2025): Finalization and ratification of the Cardano Constitution.
• Introduces Delegate Representatives (DReps), allowing ADA holders to delegate governance power.
• The upgrade transfers decision-making power from IOHK, Cardano Foundation, and EMURGO to the community.

Financial Performance

Market and Token Metrics

• ADA’s price surged 126% QoQ to $0.84.
• Market capitalization rose 127% QoQ to $30.3 billion, moving ADA’s rank from 11th to 9th.
• Circulating supply declined by 2.2%, contributing to price growth.
• Staking yield (real, annualized) increased 18% YoY to 0.7%.

Network Fees and Treasury Growth

• Fees (USD) grew 254% QoQ to $1.8 million, driven by a 65% increase in daily transactions.
• Cardano Treasury balance increased 6% QoQ to 1.6 billion ADA (valued at $1.4 billion).
• Transaction fees (USD) increased 80% QoQ, while fees in ADA declined 2%, reflecting improved efficiency.

Network & Ecosystem Growth

Transaction and Staking Activity

• Average daily transactions increased 65% QoQ to 71,500.
• Active addresses rose 58% QoQ to 42,900.
• Transaction-to-active address ratio grew 6% QoQ, indicating increased user activity.
• Total staked ADA declined 4%, but total staked value (USD) increased 117% due to ADA’s price appreciation.

Decentralized Finance (DeFi) and Stablecoins

• Total DeFi TVL surged 94% QoQ to $448.9 million.
  • Liqwid Finance TVL grew 141% QoQ to $113.6 million, overtaking Minswap.
  • Minswap TVL rose 69% QoQ to $98.9 million.
  • New entrants like Splash Protocol and Aada saw massive growth (253% and 105% QoQ, respectively).
• Stablecoin market cap increased 66% QoQ to $23.2 million.
  • iUSD led the market with $9.4 million, while DJED and MyUSD also gained traction.
  • USDM, launched in March, remains under evaluation for broader adoption.

Decentralized Applications (DApps) and NFT Market

• Average daily DApp transactions declined 8% QoQ to 14,300.
  • Top DApps by volume: Minswap, Liqwid Finance, and jpg.store.
• NFT Market Trends:
  • Average daily NFT sales declined 2% QoQ to 430 transactions.
  • Trading volume in ADA decreased 2% QoQ, but USD volume increased 86% due to ADA price gains.
  • jpg.store dominated NFT transactions, remaining the top marketplace on Cardano.

Future Roadmap and Community Initiatives

Technical Roadmap: Scalability, Usability, and Interoperability

1. Scalability
   • Layer 2 rollups (Optimistic & ZK-rollups) to improve offchain transaction aggregation.
   • Ouroboros Leios and Peras upgrades to reduce transaction finality time from 12 hours to 2 minutes.
   • Mithril Certificates for faster node verification.
2. Usability and Utility
   • Multi-language support (Plinth, Plutus High Assurance, Aiken).
   • Integration of decentralized identity management via Hyperledger Identus.
   • Introduction of Babel fees, enabling transaction fees in multiple tokens.
3. Interoperability & Partner Chains
   • Expansion of Partner Chains (Milkomeda C1, Wanchain, Midnight, and World Mobile).
   • Midnight Testnet launched in October 2024, leveraging zero-knowledge proofs for privacy-focused transactions.
   • Bitcoin liquidity integration via Emurgo and BitcoinOS partnership.

Community & Governance Developments

• Cardano Summit 2024
  • Discussions on blockchain integration in space missions and institutional compliance.
  • Announcement of Bitcoin liquidity integration into Cardano DeFi.
  • Introduction of Art Beyond Borders Initiative to support artists using blockchain.
• Project Catalyst Funding
  • 258 proposals funded in Fund12 (46.5 million ADA distributed).
  • Fund13 introduced reduced voting minimums (25 ADA) to increase participation.
  • Future funding rounds to allocate 50 million ADA toward community-driven initiatives.

Conclusion

Cardano demonstrated strong growth in Q4 2024, with ADA’s market cap surging 127% QoQ, significant gains in DeFi TVL (94% QoQ), and rising network activity. However, dApp and NFT activity saw slight declines, suggesting user preferences shifting towards liquid assets and staking. The upcoming Ouroboros Peras and Plomin governance upgrades are poised to further Cardano’s transition to full decentralization, making 2025 a critical year for adoption and ecosystem expansion.

By Wolfy Wealth - Empowering crypto investors since 2016

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