Cardano, the proof-of-stake blockchain network, has seen significant growth in the first quarter of 2023, with a nearly tripled Total Value Locked (TVL) in decentralized finance (DeFi) and substantial technological advancements. According to a new report from crypto analytics platform Messari, the blockchain network’s increased adoption of new stablecoins and network scalability improvements, as well as virtual machine (VM) compatibility enhancements, have contributed to this growth.
The report highlights that Cardano has deployed Layer-2 scaling solutions on its mainnet, and sidechains such as Milkomeda C1 and IOG’s EVM sidechain are being developed to increase cross-chain compatibility. The blockchain has also expanded its programming language support to include Python, TypeScript, Marlowe, and Helios, making it more accessible for developers.
In Q1 2023, DeFi TVL on Cardano grew by 172%, from $50.8 million in Q4 2022 to $138.3 million. Stablecoin volume on the network also increased by 261% from $2.8 million in Q4 to $10 million. The largest volumes of stablecoins came from Indigo’s IUSD and Djed’s DJED. The dominance of major DEXs such as Minswap, SundaeSwap, and WingRiders declined due to increased interest in new protocols.
Cardano’s native token, ADA, saw a 54% price increase in Q1, with a price of $0.44 as of April 18, 2023. The platform’s treasury balance grew by 100 million ADA to 1.21 billion, with a 9.1% and 66% QoQ growth in ADA and USD terms, respectively. In USD terms, the treasury balance increased by $278 million to $460 million.
However, despite the overall growth, Cardano experienced quarter-on-quarter declines in new addresses (up 71.5%) and average daily transactions (up 10.6%). Daily NFT transactions on the network also fell in Q1, down 27%, as daily unique buyers shrunk by 23%.
In addition to this report, the Cardano Foundation recently issued its inaugural Annual Report, outlining the project’s accomplishments of 2022. The Foundation has revised its delegation policy to reward stake pool operators (SPOs) that continually provide Cardano-building tools to serve the expanding community. The Foundation also claims to have aligned the Cardano Improvement Proposals (CIPs) process with optimal open-source principles.
Overall, Cardano’s Q1 growth has been fueled by DeFi TVL and technological developments. With the deployment of Layer-2 scaling solutions and the development of sidechains, the blockchain network is expected to continue to grow and expand its capabilities. The increased adoption of stablecoins and expansion of programming language support also make it more accessible for developers. However, the decline in new addresses and average daily transactions highlights the need for continued growth and expansion in these areas.