Grayscale Investments, the world’s largest crypto asset manager, has released a research report that shows that Cardano (ADA) is undervalued considering its notable growth in global adoption over the last 12 months.
The research report published by Grayscale on 3rd October 2021 shows that the fundamentals of Cardano have significantly improved, suggesting that the cryptocurrency is likely undervalued compared to the two largest digital currencies, Bitcoin (BTC) and Ethereum (ETH).
The recent development in the Cardano ecosystem has directly pitched the largest proof-of-stake (PoS) blockchain against other smart contract platforms such as Ethereum, Solana, Polkadot, among others.
Why Cardano (ADA) Is Considered Undervalued
In the research report released by Grayscale, Cardano (ADA) currently settles more payment value per unit of market capitalization than its direct competitors, which suggests that the digital asset may be undervalued compared to other top cryptocurrencies.
According to the report, over the last 12 months, Cardano (ADA) has settled over $1.6 trillion in total on-chain transaction value, which is relatively 50% less than Bitcoin (BTC) and 40% less than Ethereum (ETH), while its market cap is 90% and 80% lower than Bitcoin and Ethereum respectively.
Moreover, the report notes that Cardano may as well be undervalued relative to Ethereum based on market value per active monthly user.
The report reads in part as follows:
“Ethereum’s value per user is ~$55,000 while Cardano’s is ~$30,000. This may imply that Cardano is lower valued relative to its largest comparable crypto network, Ethereum, based on this particular metric.”
Aside from the surge in adoption, Cardano has also seen notable growth in usage. Currently, the network processes over 115,000 transactions per day, which is 13 times since the beginning of the year.
Additionally, fees paid to Cardano (ADA) staking pools have gained a rapid increase. It has surged by a factor of relatively 65 over the last 12 months.