Cardano ADA Ecosystem Q2 2023: DeFi Growth, Stablecoins, and NFT Trends

Cardano ($ADA) ecosystem has witnessed significant growth and development in Q2 2023, according to Messari’s recent report. From the rise in stablecoin value to the expansion of decentralized finance (DeFi) and non-fungible tokens (NFTs), the network has seen remarkable progress.

Key insights from the report include a 34.9% QoQ growth in the total stablecoin market cap on Cardano, reaching $13.5 million, with Indigo Protocol leading the stablecoin and synthetic asset issuance.

Protocols created in the last ~6 months accounted for 47.4% TVL dominance in Q2. Cardano’s TVL (USD) was up 9.7% QoQ, moving from 34th to 21st in TVL ranking across all chains. Average daily dapp transactions were up 49% QoQ, with Minswap leading the growth.

In the DeFi sector, Minswap remained the liquidity king, ending Q2 with a TVL of $48.8 million. New protocols like VyFinance, Liqwid Finance, Djed, and Optim Finance also grew. Indigo and Djed emerged as the main stablecoin issuers, with Indigo witnessing a total liquidation volume of $3.6 million from 870 liquidations in Q2.

NFT transactions were down 35.7% QoQ, with total quarterly trading volume falling 41.9% QoQ to $46.2 million. Notable initiatives included the UN Refugee Agency using NFTs for charity. Milkomeda C1, launched in early 2022, brought EVM compatibility to Cardano, with daily unique contract callers surging 279.9% QoQ, driven by the gaming sector’s growth.

Project Catalyst, a decentralized fund for innovative projects, funded 1,163 proposals in nine rounds, with Fund 10 allocating 50 million ADA (~$14 million) among 13 Challenges. Cardano developers are building tools to support languages like Marlowe, Aiken, Plu-ts, Helios, and OpShin.

IOG launched a toolkit for building custom sidechains, and Wanchain announced its bridge on the Cardano preview testnet. Hydra, a family of scaling protocols, opened its first Head on the Cardano mainnet in March 2023, marking a significant step in scaling solutions.

Cardano’s ecosystem is expanding rapidly, with DeFi owning the spotlight in Q2. New protocols are emerging, and incumbent ones are building and maintaining a presence. The growth in stablecoins, NFTs, gaming, and Layer-2 solutions indicates a vibrant and evolving ecosystem.

With Project Catalyst Fund 10 in progress and continuous development in various sectors, Cardano’s future looks promising and filled with opportunities for innovation and growth.

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Tetra Partners with Kiln to Enhance Staking Service Including Ethereum and Solana

Tetra Trust Company (Tetra), Founded in 2019, Canada’s only licensed custody solution for digital assets, has announced the rollout of increased staking functionality through its strategic partnership with Kiln, a leading enterprise-grade staking platform.

The Tetra-Kiln Partnership

Starting today, Tetra clients can stake their assets with Kiln on the main Proof-of-Stake (PoS) blockchains such as Ethereum (ETH), Solana (SOL), Polygon (MATIC), Cardano (ADA), and Tezos (XTZ). This collaboration aims to provide secure and efficient methods for institutional clients to actively participate in blockchain networks and earn rewards on their digital asset holdings.

Kiln is the leading enterprise-grade staking platform, enabling institutional customers to stake assets, and to whitelabel staking functionality into their offering. Kiln runs validators on all major PoS blockchains, with over $2.2 billion of stake under management and over 3% of the Ethereum network.

Kiln, known for its high standards of operational excellence, manages over $2 billion worth of staked assets and is SOC 2 Type II certified. “We are excited to offer our clients staking opportunities thanks to our collaboration with Kiln,” says Didier Lavallée, CEO at Tetra. “The solution Kiln brings to the table is quite impressive, not only does Kiln meet our security and technical requirements, their all-encompassing capabilities make it a robust solution to offer our clients.”

Laszlo Szabo, CEO at Kiln, stated, “We strive to enable institutions to access staking. Being our first enterprise-grade custodian partner in Canada, we’re thrilled to collaborate with Tetra, with whom we share common values.”

Understanding the Staking Opportunity

In PoS blockchains, staking consists of locking native tokens to earn the right to help secure the chain via a validator. Staking plays a crucial role in network security, governance, and contributes to the growth of the Web3 ecosystem. By staking, token holders can earn rewards and grow their digital asset holdings.

This collaboration marks a significant milestone in both companies’ commitment to delivering the highest standards of security and service for institutional and corporate clients.

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Cardano ADA Q2 2023: Dapp Transactions Up 49%, TVL Increases 9.7%

Messari, a leading provider of crypto research and insights, has released its Q2 2023 report on Cardano, a prominent Proof-of-Stake (PoS) Layer-1 smart contract network. The report highlights key insights and developments within the Cardano ecosystem, providing a comprehensive overview of its performance, financial status, ecosystem, staking, and decentralization, along with notable community and development events.

Key insights include average daily decentralized application (dapp) transactions being up 49% QoQ, with Minswap experiencing the largest absolute growth. Total Value Locked (TVL) in USD was up 9.7% QoQ and 198.6% YTD, moving Cardano from 34th to 21st in TVL ranking across all chains. Hydra Head, an off-chain mini ledger, continued its development with proposed topologies and a demo shared. Projects like Milkomeda C1, Midnight, Wanchain, and IOG’s sidechains team are working towards increased interoperability within the Cardano ecosystem.

The average transaction fee increased 8.5% QoQ from $0.117 to $0.126, still down 50.8% YoY. Daily active addresses declined 4.0% QoQ from 60,200 to 57,800. Average daily transactions were up 1.9% QoQ from 67,500 to 68,800. Cardano’s average blockchain load increased from just under 40% in Q1 to over 50% in Q2.

ADA’s price pulled back 26.9% QoQ after a 53.5% increase in Q1 but is still up 12.0% YTD. Cardano’s Treasury balance grew 8.5% to 1.30 billion ADA during Q2, with the value in USD terms decreasing 20.7% QoQ from $452 million to $358 million.

Cardano’s total stablecoin market cap grew 34.9% QoQ from $10.0 million to $13.5 million. Minswap, an automated market maker (AMM), ended Q2 with a TVL of $48.8 million and 32.2% dominance.

There were 1,921 unique stake pool operators (SPOs) in Q2, with the top 188 pools (6.5% of pools) accounting for over 50% of the total stake.

The 2023 Cardano Summit was announced to take place in Dubai in November. IOG launched a toolkit for building custom sidechains for Cardano, and Wanchain’s bridge is now live on the Cardano preview testnet environment. Hydra, a family of scaling protocols, continued its development, with the first Head opened on the Cardano mainnet in March 2023.

Cardano’s Q2 2023 report showcases significant growth in various areas, including dapp transactions, TVL, and development initiatives. The continued focus on interoperability, scalability, and community engagement positions Cardano as a leading player in the blockchain space, with promising prospects for the future.

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Crypto Trends: Weekly Inflows and Outflows in Altcoins, North American Markets, and Investment Products

As of the half-year mark, cryptos have witnessed inflows just under US$0.5 billion, according to a recent report by CoinShares.

93% of the outflows were from long-Bitcoin investment products, while short-Bitcoin saw its 14th consecutive week of outflows, totaling US$3.1 million. This trend suggests that investors have been taking profits in recent weeks, though the sentiment for the asset overall remains supportive.

Altcoins, excluding Ethereum, experienced inflows amounting to US$3 million in the past week and US$19 million over the last eight weeks. Cardano, Solana, and XRP led the way with inflows of US$0.64 million, US$0.6 million, and US$0.5 million, respectively.

The North American region, encompassing the US and Canada, saw a significant outflow of 11 billion dollars. In contrast, Switzerland and Sweden recorded outflows of US$3.2 million and US$2.6 million, while Germany welcomed inflows of US$5 million.

Digital asset investment products witnessed minor withdrawals totaling US$21 million last week. Trading volumes stood at a modest US$915 million, a marked decrease from the US$1.5 billion weekly average of the previous year. The broader Bitcoin market experienced US$16 billion in trades on trusted exchanges last week, a decline from the US$52 billion weekly average observed this year.

Ethereum and Avalanche saw minor outflows totaling US$1.9 million and US$0.4 million, respectively.

The data reflects a mixed sentiment in the digital asset market, with a noticeable shift towards altcoins and a reduction in trading volumes. The continuous outflows from long-Bitcoin products and the regional variations in investment flows provide insights into the current market dynamics.

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Digital Currency Group Sells Shares in Subsidiary’s Crypto Funds

The cryptocurrency conglomerate known as Digital Currency Group (DCG) is apparently getting ready to generate cash and maintain its liquidity by selling its assets in cryptocurrency funds that are managed by a subsidiary of the company known as Grayscale Investments.

According to a report that was published on February 7 by the Financial Times, which cited United States securities filings, DCG sold approximately one quarter of its shares in Grayscale’s Ether (ETH)-based fund for approximately $8 per share, despite the fact that each share held a claim to nearly double that amount in ETH. The filings were cited in the report.

In addition to this, it is said to have sold down small share parcels in Grayscale’s Litecoin (LTC), Bitcoin Cash (BCH), and Ethereum Classic (ETC)-based trusts. This is in addition to its Digital Large Cap Fund, which is a single fund that invests in Bitcoin (BTC), Ether, Polygon (MATIC), Solana (SOL), and Cardano (ADA).

The response that DCG gave when queried about the share sales was that “it is just part of our regular portfolio rebalancing.”

In spite of this declaration, there are others who feel that Barry Silbert’s DCG might be heading for some kind of financial difficulty.

Another of its companies, the cryptocurrency lending business Genesis Global Capital, filed a bankruptcy petition on January 19 and is reported to owe its creditors more than $3 billion.

Companies controlled by DCG have been significantly impacted by the contagion that has resulted from FTX’s downfall. Over the last several weeks, these companies have been forced to let go of over 500 people.

However, DCG has taken a number of actions to maintain liquidity in 2023, such as informing its shareholders in a letter dated January 17 that it would be discontinuing its quarterly dividend payments as it seeks to improve its balance sheets. This was one of the many initiatives that DCG has done.

After stating that it had received offers for the cryptocurrency media outlet CoinDesk that were greater than $200 million, DCG has reportedly sought the assistance of the financial advisory firm Lazard in order to assist it in weighing up options to sell CoinDesk, which is another of its subsidiaries.

According to the company’s website, DCG’s venture capital portfolio includes about 200 crypto-related startups, some of which include Grayscale, Genesis, and CoinDesk. Additionally, DCG has interest in a number of other businesses, such as the cryptocurrency exchange Luno and the advising company Foundry.


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Cardano’s New Algorithmic Stablecoin DJED

Since the crash of the TerraUSD (UST) algorithmic stablecoin in May 2022, many users in the crypto ecosystem have acquired a weariness against that specific asset class. The market for algorithmic stablecoins has plummeted 10x from its all-time high before the Terra crash.

However, this has not prevented Cardano network engineers from going through with the introduction of the ecosystem’s overcollateralized stablecoin on Jan.31. The new algorithmic stablecoin, Djed (DJED), released on the Cardano mainnet and is tied to the United States dollar and backed by Cardano’s native cryptocurrency, ADA. It employs the Shen (SHEN) token as its reserve currency.

The release states that the new token has only just passed a security assessment and that it has been in development for more than a year. As a method for the creation of new decentralised finance (DeFi) and payment possibilities, DJED is a product that was developed by Coti, a developer of DeFi solutions that runs on the Cardano blockchain.

The concept of bringing into existence yet another algorithmic stablecoin produced tremors among members of the online cryptocurrency community prior to the debut of the brand new Cardano stablecoin.

This is one of the most recent updates in a series of recent updates that have come out of the Cardano network. These updates include an announcement made on January 12 by co-founder Charles Hoskinson that the ecosystem will expand via custom-built sidechains. This is one of the most recent updates in this series.

On January 23, an anomaly caused fifty percent of Cardano nodes to become disconnected and need a restart; this resulted in an interruption of network service. This was only one week before to the introduction of the brand new algorithmic stablecoin.

According to a report by Bloomberg from the beginning of the year 2023, the risk assessment company Moody’s Corporation is in the process of building a score system for stablecoins. This system will include an initial examination for up to 20 digital assets.


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Cardano Nodes Go Offline for Half an Hour

At least half of the nodes on the Cardano network fell down for a short period of time over the weekend, according to reports from stake pool operators (SPO) and users of the cryptocurrency. An abnormality caused fifty percent of Cardano nodes to disconnect and restart, according to a message that was published on January 22 and posted on the SPO for Telegram by Input Output Global, the engineering and research company that is responsible for the Cardano blockchain. The unexpected interruption was explained in a post by the statement that “This seems to have been caused by a transitory anomaly triggering two reactions in the node,” which said that some nodes had detached from a peer, while others had thrown an exception and resumed.

In spite of a brief drop in performance, the Cardano network was able to recover without any assistance from outside sources.

In the article, it is stated that “such temporary difficulties” were taken into consideration during the node design and consensus process, and that “the systems operated precisely as predicted.”

During the anomaly, which took place between blocks 8300569 and 8300570, it was claimed that block production continued, although it was delayed for a few minutes. The “effect was minor, comparable to the delays that occur during regular operations,” according to the report. ” Depending on the SPO that was selected, the majority of nodes automatically recovered.

At the time this article was written, the underlying problem that led to the anomaly and the subsequent node disconnections and restarts was still being investigated. According to the official notice, “We are presently researching the underlying reason for this aberrant activity and adopting more logging measures alongside our normal monitoring methods.”

Tom Stokes, who is also a Cardano SPO and the co-founder of Node Shark, said in a post on January 22 that much over half of the nodes that were listed were impacted by the issue.

In addition to that, he presented a graphic that illustrated the point at which the network sync dropped from 100% to just slightly over 40% for more than 300 reporting nodes.

According to Stokes’ chart, following the decline in performance, the network sync was able to recover to a level of around 87%, but it did not instantly return to its original level of 100%. An other SPO reported similar concerns to Stoke in a post on January 22, but said that “several SPOs experienced no effect.” “Others experienced a restart of their relays and BPs.

The SPOs, Developers, and IOG are now debugging on Discord.

There is not a fundamental reason as of now “They said that.


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Cardano stablecoin shutters following launch delays

On November 24, Ardana, a renowned decentralized finance (DeFi) and stablecoin ecosystem that was built on Cardano (ADA), abruptly halted development. They justified their choice by saying that there was “funding and project timeline uncertainty.”

However, Ardana Labs will maintain any remaining funds and treasury balances in its control “until another competent dev team in the community comes forward to continue our work.” The source code for the project will continue to be accessible to anybody who wants to build with it.

The news was made in an abrupt manner, which led many individuals to be taken aback. As a result, the decision came as a surprise to many people.

On the other hand, it would seem that issues have been there for a substantial length of time prior to this point.

Since the fourth of July, Ardana has been conducting what is often referred to as an initial stake pool offering (ISPO) in order to raise capital for its business activities.

Instead of the ADA being donated to the developers by the users, the incentives for staking are given to the developers themselves. This is in contrast to the traditional methods of fund-raising, which allocate the ADA to the developers.

The fact that users are awarded DANA tokens, which are fundamental to the operation of the platform, as a reward for delegating creates an incentive for them to continue doing this action.

Unfortunately, issues have arisen for ISPO issuers as a result of the simultaneous decline in price of DANA and ADA, as well as the falling returns obtained from staking Cardano as a result of the current crypto winter. Both of these phenomena are a direct result of the current state of the cryptocurrency market.

The value of Ardana’s native DANA coins has dropped by more than 99.85 percent during the course of the last year.


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Cardano Chief Says He’s Not Retiring Anytime Soon

In a recent video he titled “Birthday Musings”, Charles Hoskinson, founder of the blockchain platform, Cardano has said he is not retiring anytime soon. He feels there is a lot at stake, hence leaving the company now is not the right option.


The 35-year-old founder condemned the activities of trolls and the constant attacks he keeps getting lately on social media. While he admits that it’s frustrating when people lie about Cardano’s progress, Charles is reluctant to throw in the towel just yet and will keep at it as long as there is something to win.


Recently Charles repurposed the verified Twitter page of Ethereum Classic to that of the Ergo proof-of-work network. His confiscation of the account that has served the Ethereum Classic community since 2016 was greeted by condemnation by many in the crypto Twitter community. Many believed the 600k Twitter handle belonged to the community and Charles was just a custodian.


Furthermore, the Cardano chief publicly severed ties with the XRP community after news of the brawl with Ethereum Classic made the rounds. The outspoken critic has been the target of many supporters of the XRP coin. According to his tweets, these XRP trolls continued to harass him unprovoked, forcing him to block most of them as he says he’s done with it.


The move sparked reactions in the crypto Twitter community with some users urging the Cardano chief not to stereotype the XRP community based on the actions of a selected few.


Meanwhile, the Cardano founder has said Blockchain technology could revolutionize government structures from the whelms of archaic processes to modern ones. With the recent video, it’s evident that Charles is in no hurry to join other top executives in crypto firms that have either retired or stepped down from their positions to pursue other possibilities.

In September, Jesse Powell, co-founder of crypto exchange Kraken, stepped down as Chief Executive Officer and was replaced by the firm’s Chief Operating Officer Dave Ripley. Also, Alexander Höptner, took over as CEO of BitMEX Exchange after Authur Hayes submitted his resignation last month.

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Cardano’s Vasil Upgrade is Finally Complete

Cardano’s Vasil upgrade has been completed. The much-awaited set-off will enable increased network capacity, higher throughput, and lower transaction costs on the peer-reviewed, proof-of-stake blockchain platform.

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“The Vasil hard fork moves us towards this goal by improving Cardano’s foundational features, upgrading the technology’s capacity to transform our traditional financial and social systems, and ultimately advancing decentralised economic empowerment,” Frederik Gregaard, CEO of the Cardano Foundation, told The Block.  

The Vasil hard fork focuses on optimisation, scalability and interoperability. It is part of Cardano’s Basho era — one of the critical development phases on the Cardano roadmap.

During the upgrade, Vasil required no action for regular ADA holders using Cardano for transactions and dApps as the transition happened behind the scenes.

The upgrade was initially planned for June, but the postponed upgrade also activated Plutus v2 enhancements to Cardano’s smart contracts.

The Vasil upgrade has taken the blockchain platform closer in line with the capabilities of Ethereum – the largest smart contract platform. It further opens up the potential for current and new Cardano DeFi projects to create more powerful, efficient, and cost-effective applications.

Cardano founder Charles Hoskinson said, “(We) knew that, over time, we could get to what Ethereum has done, but we understood a road map to get there,” ahead of the upgrade about the blockchain platform’s gradual approach to adding new capabilities.

The upgrade date was finalised earlier in September by the Cardano-focused research and development company, Input Output Global (IOG). The decision was made after the critical mass indicators required were completed and successfully gained assurances from staking pool operators, exchanges, and dApp communities stating that they were ready for Vasil.

According to The Block, the Vasil upgrade was conducted in collaboration with people from across the Cardano ecosystem from the core development team, the Cardano Foundation, IOG, Emurgo, and the wider Cardano community via technical Cardano Improvement Proposals (CIPs).

Cardano stated that the upgrade promises increased functionality, performance and scalability. The new Vasil capabilities will be available on the mainnet after one epoch, on Sept 27.

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