Will eToro’s Delisting Change Fortunes for Cardano (ADA)

Cardano (ADA) saw a recent price shakedown, after renewed doubts on US-based traders being eligible to trade the asset. 

ADA has been removed from the eToro brokerage, blocking US-based traders. This only puts a small dent in ADA trading volumes in the short term. 

ADA holders beware!

eToro didn't decide to lose money for no reason – the most likely reason to stop ADA trading for U.S. customers is a warning from the SEC.

And if the SEC really wants to "protect" ETH (as I've been reading), who would it sue next?https://t.co/0Abo86PL0w

— Jeremy Hogan (@attorneyjeremy1) November 27, 2021

ADA traded at $1.58, erasing about 12% in the past week in tune with the overall drop in legacy coin prices. ADA stopped its price climb just under $3, losing some of its appeal to more active networks. 

What is the Status of ADA

The exact status of the ADA token in terms of security law is unknown. ADA is to be used as a utility asset, though the Cardano network still mostly runs with no significant project-building. 

The ADA delisting will not be immediate but take place at some point next year. The exact reason for the delisting has not been given by eToro, and the company has not explained its knowledge regarding ADA asset status. 

In the past, fears have been raised about multiple digital assets, including Ethereum (ETH), which could be considered unregistered securities. 

The first step of the delisting will be to stop ADA staking, forcing traders to move their coins with another pool. Since eToro allows for real asset holding and not only CFD trading, the actual ADA may also be moved to another market. 

Is the eToro Delisting Just Short-Term Fear Strategy

For ADA, moods run strong in both its supportive community and its attackers. The eToro announcement, which landed on November 23, has been absorbed by the market, but may spark more doubts about ADA in the near future. 

ADA trading has multiple sources of liquidity and the limitations on eToro may be a minor factor. For US-based persons, Coinbase exchange continues to support ADA, with no sign of delisting upcoming. ADA trading pairs on Binance are also highly active, though also excluding US-based traders.

TRON (TRX) Also Affected by Delisting

TRON (TRX) will also go through a gradual delisting schedule on eToro. Just like with ADA, TRX holders will go through several milestones, starting with a trading halt on December 26. Afterward, staking rewards will stop being paid to holders. 

Owners of ADA and TRX will be encouraged to either get redeemed in cash, or move their asset to eToro’s cryptocurrency wallet. The exchange is yet to build wallet capabilities for those two assets. 

TRX is mostly used as a utility asset, as well as for voting, staking and trading NFTs and game items. TRX remains a low per-unit cryptocurrency, at $0.096. So far, TRX has lagged behind other platforms, despite its well-developed network with multiple games. TRON adoption has built a large gaming community in Asia, but the platform has been tainted by high-risk and gambling distributed apps. 

Is the Cardano Project Moving Forward

The Cardano network claims to be supporting millions of tokens. But simple token creation may not be enough to build a digital asset economy. 

The biggest problem with the Cardano network was the lack of smart contracts. For years, the project has promised capabilities as powerful as other networks. However, Cardano lagged behind all other platforms. 

The Alonzo hard fork, an event that took place in September 2021, finally remedied that flaw. For months, the Cardano network has been open to smart contract builders, with signs it may be hosting its first DeFi projects. 

Now, the Cardano network is seeing renewed developer activity, with the potential to build an ecosystem similar to larger networks like Solana (SOL), Terra (LUNA) and others. For now, the short-term market price has not reflected that activity. 

There are still no statistics on Cardano’s value locked. In the DeFi space, total value locked can grow explosively in weeks, provided enough projects attract users. Cardano may continue to hold risks, as smart contracts are one of the riskier aspects of cryptocurrency transactions. 

The coming months will show if ADA turns into another DeFi powerhouse, potentially climbing to a higher valuation. 

I've accumulated #Cardano $ADA 
since 2017.

I saw the price go from $.0024 to $1.31, then back again to $.018.

They don't make bears big enough to make me consider selling a single $ADA weeks before DeFi and quadruple yield!

PS! Don't miss #Cardano360 on Thursday at 16.30 UTC!

— Eilert 🇳🇴 (@Eilert) November 23, 2021

ADA, much like Tezos (XTZ) and other coins has taken a roundabout path to development, taking years where other projects took months. However, the network could be given another chance in 2022. 

The advantage of Cardano is the relative prominence of ADA as a top 10 digital asset by market capitalization. ADA has a 2.3% market cap dominance, turning it into one of the more influential altcoins. 

With the fast time frame to building DeFi side projects, there are expectations signs of wider adoption for Cardano may arrive within just a couple of months. 

In the short term, ADA market prices may be affected by the overall mood of fear. Despite the growing popularity of altcoins, price shocks are still highly probable. With expectations of a year-end rally, traders are becoming more fearful as Bitcoin (BTC) has stalled under $60,000.