The launch of the Cardano Alonzo hard fork upgrade in September 2021 triggered smart contracts that facilitate the creation of decentralized applications (dApps). Demand for its native asset, ADA for staking purposes spiked, especially in February 2022. Cardano has further stretched its lead over Ethereum in terms of the total number of stakers.
Cardano (ADA) saw its total number of stakers beat out major competitor Ethereum in February. Cardano managed to end the second month of 2022 with 1.17 million stakers, according to BeInCrypto Research.
Although Cardano saw a 2% increase in the number of stakers, up from 1.14 million in January 2022, the network continues to hold the larger share against Ethereum 2.0.
Cardano popularity surges in 2022
Cardano has witnessed impressive growth in 2022 despite numerous criticisms from blockchain enthusiasts and decentralized finance fans about the lack of real use cases. The ecosystem is being led by decentralized exchanges SundaeSwap and MiniSwap which have both had positive effects on the total value locked in the Cardano ecosystem.
On Jan. 2, the total value locked (TVL) in Cardano was $822,261. A 292% spike led to TVL reaching $3.2 million on Jan. 20. Two days later, Cardano TVL increased by a staggering 2,619.99% to $87.79 million. A small correction towards the end of the month saw the total value locked close on Jan. 31 at $72.41 million.
TVL in Cardano surpassed $100 million on Feb. 13, $120 million on Feb. 16, and eventually settled at $113.9 million on Feb. 28.
Total value locked in Cardano remains strong so far in March, currently standing at more than $130 million.
Cardano positive netflows in February
To understand the Netflow indicator, we first must understand inflows and outflows.
Inflows are the number of ADA deposited into exchange wallets and outflows are the number of ADA withdrawn from exchange wallets.
The difference between coins flowing into and out of exchanges is called Netflow.
Inflows for Cardano (ADA) on Feb. 28 were 10.36 billion.
Outflows for Cardano (ADA) on Feb. 28 were 9.7 billion.
This means that Cardano netflows (inflows of 10.36 billion minus outflows of 9.7 billion) amounted to 666.05 million.
Ethereum 2.0 stakers lag behind Cardano
Ethereum 2.0 is the transitioning of the Ethereum network from the energy-intensive proof-of-work (POW) consensus model first employed by Vitalik Buterin after Satoshi Nakamoto’s Bitcoin, to a more environmentally-friendly proof-of-stake (POS) system.
Still in its earliest stages, Ethereum 2.0 is yet to reach full functionality. Negative crypto market sentiment has affected the network across all areas. Aside from price, total value locked, and the number of stakers has taken a massive hit. The total number of stakers on Ethereum was 54,772 on the first day of 2022 and on Jan. 18, this number decreased to 54,768 and remained the same throughout February.
When compared with Cardano, Ethereum saw relatively low inflows and outflows which ultimately culminated in moderate netflows.
Inflows for Ethereum (ETH) were 546,120 on Feb. 28.
Outflows for Ethereum (ETH) were 414,620 on Feb. 28.
Netflows for Ethereum (inflows of 546,120 minus outflows of 414,620) equaled 131,500.
Staking has become a new way of making passive income whereby you hold certain cryptocurrencies such as ADA and ETH 2.0 to earn rewards.
Based on the statistics earlier mentioned, it’s clear that Cardano leads Ethereum by more than 20 times its total number of stakers in February.
This is because there is a massive gap in netflows (666.05 million compared with 131,500), which confirms the increasing movement of ADA by millions of holders.
Aside from that, ADA holders have a range of platforms that support staking.
Some of these platforms include but are not limited to Kraken, Binance, Coinbase, Yoroi, and the Daedalus wallet.
Coinbase and Binance are not only among the largest cryptocurrency exchanges by daily volumes but have millions of users as well.
The combined total user base of Coinbase and Binance is well over 100 million.
With Cardano and Ethereum strong in development activity in 2022, the number of stakers, as well as total value locked on each platform are likely to go up throughout 2022.
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