Cardano (ADA) has caught the attention of the crypto market community following the sharp rise in its market cap dominance.
According to data shared by Dave (@itsdave_ada) on X, ADA’s market dominance is up 5.63% in the last 24 hours. Dave is a verified figure in the Cardano community and a stake pool operator.
What does ADA’s dominance surge mean?
This sudden rise brings ADA’s share of the broader crypto market to 0.9%, making it one of the highest single-day gains for this asset in the last few weeks. This dominance metric measures a crypto’s market share compared to other digital assets.
Hence, the rise in this metric for ADA means investors are pumping funds into this coin more than the other major cryptocurrencies. This 24-hour gains follows a 9.69% gain in the last seven days even though ADA’s dominance in the last 30 days is still down by 1.54%.
However, the coin’s dominance has recorded substantial growth over the long-term. It is up 74.79% in the last six months and 80.61% in five years.
There are multiple factors causing this rise in market share. One of such factor is the consistent network upgrades by the Cardano development team.
The latest of which is the valentine upgrade which was aimed at improving cross-chain communication capabilities. Another factor is the growing institutional interest in proof-of-stake assets that are Ethereum competitors.
ADA is positioned for a major breakout
In addition, increased real-world adoption of Cardano for many applications such as decentralized finance (DeFi) projects building on this ecosystem, could be another factor causing it to attract more funds inflow and boosting its market dominance.
A side benefit of this real-world adoption is that large holders (otherwise known as whales) would be buying more ADA tokens, which would further boost its dominance and price.
Historically, this kind of trend is an early sign that the altcoin season is gaining momentum. During this period, funds flow moves from Bitcoin to top altcoins such as ADA. This recent spike in dominance could be the start of a new rally for ADA as its year-to-date dominance is still down at 3.23%.
With its 80.61% 5-year dominance growth, the cryptocurrency has been able to withstand recent market downturns even though it has experienced some short-term volatility. Besides the dominance growth, upcoming network developments could also affect ADA’s price positively.
Also, if the Bitcoin dominance rate keeps dropping, it could benefit altcoins, including ADA. Cardano’s native token trades at $0.7192, gaining 2.8% in the last day, according to CoinMarketCap data at the time of writing.
Despite the dominance rise, U.today reported that SUI has now outranked Dogecoin and Cardano in terms of market cap.
