Cardano, the blockchain platform that aims to deliver more advanced smart contracts and decentralized applications, has recently regained its position as the seventh-largest cryptocurrency by market capitalization, surpassing Solana, the high-performance blockchain that boasts fast and low-cost transactions.
However, this flipping was not driven by Cardano’s own strength, but rather by Solana’s weakness. While Cardano’s price dropped by 2% in the last 24 hours, Solana’s price plunged by more than 5%, according to CoinMarketCap data. At the time of writing, Cardano was trading at $0.3092 with a market cap of over $10.8 billion, while Solana was trading at $0.2814 with a market cap of over $10.3 billion.
Why Did Solana Fell Behind?
The reason behind Solana’s decline is not clear, but some analysts have speculated that it could be due to profit-taking, technical issues, or increased competition from other blockchains. Solana had a remarkable rally in the past few months, reaching an all-time high of $0.58 on June 9th, 2023, and flipping several major cryptocurrencies along the way.
However, since then, it has been losing momentum and market share, as investors may have shifted their attention to other projects.
Cardano, on the other hand, has been relatively stable in terms of price action, but it has also been facing some challenges in terms of adoption and innovation.
The platform has recently released its latest Daedalus 5.3.0 update, which supports the new Project Catalyst registration process, improves the stability of the exchange rate conversion feature, and brings several dependency updates.
Project Catalyst is Cardano’s community-driven innovation fund that aims to support the development of new ideas and solutions on the network. The new registration process allows users to register their wallets and vote for their favorite proposals using Daedalus, Cardano’s official wallet.
However, despite these improvements, Cardano’s on-chain metrics remain bearish, indicating a low level of activity and interest among users and investors. For example, Cardano’s volume has dropped significantly, reflecting a lower willingness to trade the token.
Moreover, positive sentiment around the token also decreased sharply last week, suggesting a loss of confidence or enthusiasm among the community. Additionally, after a brief increase, Cardano’s 1-week price volatility has registered a downtick, reducing the chances of a sudden uptrend in price over the days to follow.
Therefore, it seems that Cardano’s flipping over Solana is not a sign of its superiority or dominance, but rather a temporary situation that could change soon if Solana recovers or Cardano fails to deliver on its promises.
