A market analyst suggests Cardano future gains depend on total market growth, but sees limited profit potential from current levels.
Cardano (ADA) has seen notable volatility over the past week. The token reached a local high of about $0.83 on May 23. However, within just two days, it dropped sharply to around $0.73. This decline appeared to reflect a sudden shift in investor sentiment or possibly a response to broader market developments.
Meanwhile, since May 26, ADA has shown signs of stabilization, fluctuating between $0.74 and $0.76. This suggests ongoing uncertainty or price consolidation. As Cardano continues to trade sideways, an analyst has outlined his expectations for its next major move.
Potential Hinges on Market-Wide Expansion
On X, crypto analyst Egrag Crypto has shared a measured but skeptical view on Cardano (ADA), questioning its profitability from current levels despite acknowledging its long-term potential.
A central part of Egrag’s argument hinges on market cap dynamics. He outlines a hypothetical scenario in which Cardano reaches a $500 billion market cap. To sustain that valuation while maintaining a 5% share of the total cryptocurrency market, the overall crypto market would need to grow to $10 trillion.
Looking back at ADA’s past performance, Egrag notes that even at its peak in 2021—when Cardano was among the most talked-about and widely traded digital assets—its dominance never exceeded 5%. This historical limitation casts doubt on the likelihood that ADA will significantly outperform.
ADA’s Market Cap Could Barely Reach $500 Billion
Egrag also used historical price patterns to estimate possible future outcomes. He suggests that a $500 billion market cap for ADA could be revisited if the crypto market follows similar trajectories as in previous cycles. At a $500 billion market cap, ADA would be approximately $13.91.
Additionally, if Cardano maintains the current 0.78% dominance at a $10 trillion total market cap, its price would be approximately $2.16 with a $78 billion valuation.
In the previous cycle, Cardano’s market cap spiked significantly, surging from below $580 million, and peaking above the $80 billion mark in 2021. It later entered a prolonged consolidation to this date, now sitting at $27 billion.
This is Not Hating on Cardano
Adding a broader context, Egrag compated between ADA and XRP from the last cycle. His comparison indicates he sees Cardano following a path similar to XRP in the 2021 bull run.
Specifically, at that time, XRP underperformed and failed to break its all-time high while other assets surged. He believes ADA could repeat this pattern in the current cycle.
He references the fact that Cardano has even been mentioned by Donald Trump as part of a potential digital asset stockpile, but questions remain about where meaningful adoption or traction will come from.
Egrag’s key takeaways are clear. First, ADA may not be the most profitable coin from its current price point, especially when compared to other mid-cap assets with more room to grow.
Second, a 10X move to around $7 could happen if the total crypto market cap expands to $10 trillion, which would represent about a 2.3X gain over ADA’s previous all-time high. Cardano would need to surge approximately 831.76% to reach $7 from $0.7511.
Third, if the market does not reach that level of expansion, ADA may continue to face challenges in regaining dominance and delivering strong returns.
Broader Market Conditions Still Key to ADA’s Performance
Elsewhere, YouTuber and analyst Alex Becker recently presented a contrasting view on Cardano, suggesting in a video that ADA could outperform Solana in the current cycle, potentially offering a 5x to 8x return, which would value it near $6.10.
While he acknowledged Ethereum as a safer asset, he identified ADA, along with Sui and other mid-cap tokens, as high-risk, high-reward opportunities. Despite past criticisms of the Cardano community, Becker disclosed accumulating ADA during market lows and previously projected a rise to $5.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
