Where & How to Invest in Cardano (ADA) in 2023
Founded by Charles Hoskinson, one of Ethereum’s co-founders, Cardano can be perceived as an updated version of Ethereum, and a third-generation open-source blockchain platform, which uses Proof of Stake consensus for transaction validations. The platform allows for the easy development of decentralised apps and smart contracts.
Cardano’s native token ADA, which powers the platform, witnessed an aggressive surge during 2020 and 2021, reaching an all-time high above $3. If you are wondering how to invest in Cardano, we’ve provided some methods below.
1. Trade Cardano
Trading Cardano through a cryptocurrency brokerage platform constitutes one of the most frequently used ways of investing in ADA. Taking this investment route would entail speculating on ADA price movements, using financial derivative products like CFDs (Contracts for Difference), Future and Options.
This type of trading activity distinguishes itself in the way that you get to use the ADA’s price volatility to your advantage, without actually owning and storing the cryptocurrency. You don’t need to buy or manage a crypto wallet either.
Investing in Cardano through this method works out best for people who have some knowledge of short-term trading, and can make effective use of analytical tools to make timely and well-informed trading decisions. If used thoughtfully, you can use this approach to create a secondary income for yourself. On the other hand, if you’re new to crypto trading, it is advisable that you go slow and learn the ropes, prior to going all in.
Where to trade Cardano
We’d like to reiterate here that if you wish to trade Cardano using any of the financial derivatives mentioned above, you’d need to go through a reliable and regulated brokerage platform. With most of the dependable brokerage sites regulated by well-known authorities, you may need to upload your government-issued ID and proof of address to comply with their KYC procedures. Once the broker has verified your credentials, you’ll be able to open long/short positions on Cardano, using your knowledge and research.
With the cryptocurrency market inundated with all kinds of broker platforms these days, you can use important parameters such as regulatory status, withdrawal/deposit options, spreads, commissions, user-friendliness, customer service and platform’s security to compare the best of them. Doing this research can take a lot of time and effort. Therefore, we carried out this comparative analysis on your behalf and have listed below some of the best brokers in the business today.
2. Buy and HODL
A backronym for ‘Hold on for Dear Life’, the term HODL came to the fore in 2013, having been misspelt by a drunk Bitcoin trader in an online chatroom! He actually wanted to write that he was planning to ‘Hold’ onto his Bitcoins for the long-term, but misspelt it as ‘HODL’! In the context of Cardano, the ‘Buy and HODL’ strategy would be essentially about buying ADA and holding on to it for a long time, to profit from its price discovery.
It’s worth mentioning here that if you want to use this Cardano investment strategy, you will need to buy the coin from a reliable source first. Ideally, crypto exchanges and broker platforms serve as the best places to procure any type of cryptocurrency, including Cardano. Although brokers mostly facilitate trading activity through derivative products on their sites, there are some who also allow actual sale/purchase of crypto assets. Please be aware that since you’d be buying ownership of Cardano, you’ll need a secure crypto wallet to store your ADA coins.
There are many ways you can buy Cardano on the Internet today. In order to make this task easier for you, our team has created some dedicated pages which detail the best ways of buying Cardano, using popular payment options like credit cards, debit cards and PayPal. You can find links to each one of these pages below. That being said, please know that the availability of these payment options will depend entirely on the local crypto laws applicable in your state/country. You may need to pay certain transaction costs too.
- Buy Cardano
- Buy Cardano with PayPal
- Buy Cardano with Credit Card
- Buy Cardano with Debit Card
3. Invest in Cryptocurrency and Blockchain Companies
Even though this investment strategy isn’t as popular as the above two, it nevertheless offers a very good way to alternatively invest in Cardano. It is essentially about investing in the shares of a blockchain or Cardano based company. With cryptocurrencies having accomplished a lot of popularity over the past few years, more and more entrepreneurs are now shifting their gaze to blockchain technology, to create innovative products and services for people across the world.
Investing into the stock of an organisation that is either heavily invested in Cardano or actively uses it as an integral part of its business model, can prove to be a very profitable investment, both over the short and long term. Doing so may also give you an opportunity to ride the crypto wave which has engulfed the entire world today, especially since the turn of the decade. In fact, you stand to gain from the positive sentiment in the crypto industry as well as the performance of the company per se. It’s important to mention here that you’d once again require the services of a regulated broker if you wish to invest in the stock of any such Cardano-based company.
Where to invest in Cardano shares
After you have successfully found a broker site that you’d like to use to buy shares of a Cardano-based company, you will need to sign up and create an account with them, to complete the transaction. We’d like to highlight that you can invest in the stock of any such company in two ways. Just as in the case of cryptocurrencies, you can either buy the actual ownership of the company’s shares or use financial derivative products offered by the broker, to bet on the shares’ price movements.
Furthermore, we cannot stress enough on the importance of using a well-known and regulated broker, for any such transactions. The ideal approach is to use some important factors like regulatory status, customer service, commissions, payment options, withdrawal/deposit options etc. to compare multiple brokers and then ppickone which fulfils all your requirements. Such comparative analysis can be very time consuming and involve a lot of effort. We’ve done all the hard work on your behalf and have listed our recommended broker for such investments below.
4. Become a Staker
Cardano’s blockchain platform uses the Ouroboros algorithm for transaction validations and the creation of new blocks. This algorithm employs PoS (Proof of Stake) protocol for mining the new blocks. What sets it apart from the protocols used by other popular cryptocurrencies like Bitcoin and Ethereum is that it saves a lot more energy. Owning any amount of ADA coins implies that you hold a stake in the Cardano network proportional to that amount. Furthermore, it’s possible to pledge your ADA stake directly or to delegate it to someone else.
There are a couple of ways you can acquire more ADA for yourself, using your already-existing ADA holding. The first is by running your own private stake pool and pledging your ADA through it, and the second is by delegating your ADA stake to someone else’s stake pool. Please note, the more is the amount of stake in a certain stake pool, the higher will be the possibility of it mining the next block. Hence, delegation is a far more popular staking option than running a private pool. The rewards earned in the form of ADA coins are shared by all who constitute a stake pool. The last we heard, Cardano users could effectively earn a passive income in the vicinity of 4.5% by staking their ADA.
Where to store Cardano
Irrespective of the route you take to acquire ADA, you will need an efficient cryptocurrency wallet to store your ADA keys. Hardware and software wallets are two of the most popular wallet categories when it comes to storing one's crypto coins. While the former provides a higher level of security, the latter can make your ADA coins readily available, as and when you need them for any online/offline transactions. You can opt for either of them depending upon what exactly you plan to do with your ADA tokens. Below we have listed our recommended wallet.
5. Become a Cardano Developer to Make Money
Another alternate route of investing in Cardano, and also being more closely associated with it, is by becoming a Cardano developer. As pointed out by Charles Hoskinson, there are close to 22.4 million software developers in the world today, with only around 80,000 being aware of Ethereum’s Solidity language. Even out of those 80,000, only 10,000 developers are actively involved in the creation of decentralised applications (dApps). Hence you can imagine the kind of scope that exists in this space today.
Plutus is the primary smart contract platform when it comes to Cardano development. The contracts created using Plutus partly run on the user’s machine (client code) and partly on the Cardano’s blockchain (on-chain code). Plutus offers a comprehensive and full-stack programming environment, with its basis in Haskell, the well-known functional programming language. Plutus smart contracts can essentially be termed as Haskell programs. Hence, if you’re keen on becoming a Cardano developer, you will need to acquire the working knowledge of Plutus and Haskell.
Furthermore, it may help a lot if you have a software engineering degree under your belt. The income you earn through your Cardano development skills can help you acquire more ADA coins and improve your stake in the Cardano network.
Expert Tip on When and How to Invest in Cardano“ In conclusion, we’d like to highlight that we went over some of the most popular ways of investing in Cardano in this piece. We delved into Cardano trading through a regulated broker, buying and holding Cardano, investing into the shares of a Cardano-based company, staking Cardano and lastly becoming a top-earning Cardano developer. To make the most of any cryptocurrency investment, you must consider multiple factors including its price history, prospects and core fundamentals. Additionally, there’s no best or worst time of making a Cardano investment. As long as you base your decision on thorough research and extensive knowledge, you’d be fine in the longer run. It’s all about learning from one’s mistakes and getting better day by day. ”- Ashish Sood