The reason why Ada will hit 10,000 $ and much higher

@PT_Cardano and @magnetar but what about the points raised through the post? The circulation of the whole units of a particular currency is just conventional (the fact someone decided that Bitcoin is 1B of smallest unit is just a choice; the fact ADA is 1M of small units it is just a choice; what if 1 hypothetical Ada was instead 1000 of the current Ada making it more similar to Bitcoin? Would the value have reason to rise? to me looks like It is just a way to call things).
Doesn’t make more sense to consider the smallest unit (satoshi or lovelace)?
And if the smallest units are not fixed but can be split at will, doesn’t all this discussion have no value at all? There is simply no upper limit only a lower one (0)?

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You actually make some good points. Whenever I hear people complain about the high supply I make similar points. That being that supply is somewhat arbitrary and you must consider the lowest denomination to get a true sense of the artificial scarcity. So to compare Ada supply to BTC supply you would need to compare a lovelace to a satoshi. However, even if the Ada market cap equaled the BTC cap it would still be a long time before the price gap narrowed. It could take until people actually started using single lovelaces and satoshis in daily transactions.

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Just to be more on the realistic side, and I’m not a math genius, let’s put this in simple numbers. When I try to estimate where a coin value is going, I compare it to the closest top competitor. In this case, I compare Cardano to Ethereum. At the time of this writing, ADA’s market cap is at 26Bil while ETH’s market cap is at 108Bil. If we assume ADA is capable of reaching ETH’s market cap, that’s a multiplier of 4.15x (108/26). ADA’s price today is sitting at $1.00. Multiply this by 4.15 and it gives you $4.15 per coin.

This assumes the current circulating supply of ADA remains the same and no coins are burned. Burning coins means shorter supply and higher price. My 2 cents.

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Hi @elmagnoon , yes that’s the normal processign people use, but I invite you to read through the previous replies that suggest that the way to esimate the possible value that ADA could reach is a thinking that does not have much reasons to be. Especially because Market Cap is calculated in a way that relates only to price and not reality.

Estimating price based on a market cap value that is calculated on price itself … is a bit like a dog that bites its own tail, no?

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True. But I used ETH as a precedent. And while I agree with all the previous comments about market caps, my analysis was merely to say Cardano is not a $10,000 coin. I truly believe in the project and am a longterm holder.

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That is because market cap = circulating supply x price but that uses an arbitrary ( or chosen ) denomination rather than the lowest denomination. So a more accurate market cap would calculate the supply based on the lowest denomination i.e., a Lovelace, Satoshi or Drop ( XRP ).

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I think that also my biggest concern is that Market Cap is calculated on price, but we don’t know if that price reflects the real value or if that value perception will not massively change in the future. As in the Oranges example from above.

So the guy buying the first orange gave a price of $1 to the orange. Should we assume that the Oranges Business has $1000 money in it (assuming that oranges are not bought to be consumed but only treaded) ? To me no, the money currently present in that market is $1 and the price could go anywhere tomorrow.

So how do we know that all of the ADA supply has been actually traded and priced properly? Maybe the majority of it is still in the back of the shop.

I have the feeling I am in a fallacy that is making me miss the point, would be nice though to hear the reason why, I am open to be completely wrong

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@vanamonde You will probably find these two links interesting:

Comparing Bitcoin and Other Cryptocurrencies by ‘Market Cap’ Can Be Very Misleading

Why most cryptocurrency market cap is fake

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Very interesting.

This is clearly reflected in Bitcoin’s market dominance. There’s a reason why Bitcoin hovers around 50% market dominance, and that is because most fiat is being counted twice – once for Bitcoin and again for the altcoin.

It adds an extra layer of fakeness to current market caps evaluation.

Makes Cardano more valuable since they plan to have FIAT to Cardano exchange capabilities inside the Deadalus wallet. Looking forward to see what happens then

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Is it possible to infer what the cipher money is like to replace the paper currency with the current common sense?
I think we should consider whether the future value of the ada can be guessed by the current number calculation method.

With 25 billions ADA right now in circulation(max supply is 45 billions) ADA would be 250 trillions or 450 trillions in USD market capitalization.

Whole world market capitalization is between 80 and 90 trillions in USD right now. So yeah ADA won’t go 10k USD… only if value of USD drops like 10/50/100 times.

But this is like saying that because Ada is today priced $1 then there are $25B money in Ada market today, which as we have discussed previously is probably far from being true.
price is not related to how much money is inside a market or at least not only on that

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Of course there are not $25B in ADA like there aren’t $90T to guarantee for world market capitalization. Value is speculative, gold standard is long gone.

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@Vanamonde Yes: the market cap is based on price. But the behavior is the opposite: the price adjusts to the correct market cap. Just think of what all the orange owners will do when they find themselves holding 10$ orange based on the “current” price…

It’s only in bubbles and short periods when there will be big differences in market cap vs real world value.
I think that the price is vulnerable to the “last transactions”, but the market cap should adjust finally to a normal value, dragging the price with it.

So I don’t think the cardano will be worth hundreds of trillions of $, more than all the real estate in the world, more than all the stock markets in the world, more than all the money (M2) from all the countries.

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Yes thanks that makes sense, the market cap is a measure for keeping price realistic.
And if price diverges because supply diverges from the one stated (i.e. whales holding a big chunk of it) it is only temporary.

Thanks for clarifying.

@johhny_px What’s your take on the fact that considering Satoshi and Lovelace the supply of ADAs is actually only double the one of bitcoins?

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Once staking begins, if the amount of coins staked is known, perhaps they can be excluded from the circulating supply and market cap calculation.

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Hi Abu, When do you predict it will hit the $5,000 or $10,000 mark? It’s currently just sitting on $1.00.
Thanks

I wish someone would just close this thread down.

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You have 45x10^9x10^6 = 45x10^15 lovelaces and you have 21x10^6x10^8 = 21x10^16 satoshis.

So roughly the same max supply, how many digits after the comma is absolutely irrelevant, especially in crypto space. It might have some psychological effect, but then this is emotions!

Finally, if ADA were BTC, that is the first crypto on Earth, then yes 10K in 10 years :smiley:

Of course, ADA is just one of the 1000s tokens around. With 0 adoption, well for 3 months :smiley:
IMHO with so much pre-minted supply, anything more than 1$ is a huge balloon IMHO :smiley:

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Aside from the $10,000 nonsense I got good info from this post.

Am I doing something wrong?

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