Cardano (ADA) briefly overtook BNB to the third position by market cap with the Crypto market trying to recover some of the losses acquired this week which saw Cardano leading the altcoins with over 40% gain.
Cardano Outperforming BNB for A Short While
Cardano led the altcoins with a 46% gain In price moving from $1.3 to $1.9 in less than 24 hours and a market cap of 58,356,567,277, surpassing BNB that had a market cap of 58,134,688,345, according to Coinmarketcap.
Unfortunately, ADA outperforming BNB by market cap only lasted for minutes with the latter regaining its third position. Cardano community are optimistic about surpassing the BNB market cap.
What Could Cause the Upsurge in Cardano Market Cap?
Input Out (IO), the team behind Cardano, is releasing an Ethereum (ETH) converter. The converter will allow users to move ERC20 tokens from the Ethereum network to Cardano (ADA).
IOHK outlined why they chose to convert ERC20 over other tokens in a recent blog post. The blog specifies that the ERC20 standard is specific to Ethereum. The standard currently supports over 400,000 contracts including Binance coin, Tether, Uniswap, and others.
In addition, ERC20 fuels Ethereum’s Layer 2 platforms, smart contracts, and DApps. Ethereum pioneered programmable tokens and as such supports the largest blockchain ecosystem. However, as blockchain and crypto adoption grows Ethereum has started struggling with various scaling problems.
To be specific, some of the problems Ethereum is facing are slow transaction speeds, network congestion, and high fees. As a result of these problems and the ever-evolving nature of blockchain, there has been a rise in Ethereum alternatives, including Cardano.
In line with this, IO noted,
“By enabling the migration of ERC20 tokens to Cardano, we focus on delivering a value proposition that leverages Cardano’s advantages over Ethereum. In particular, Cardano’s higher capacity for transaction processing and lower fees when compared with Ethereum’s high cost and often congested traffic.”
Notably, the converter allows users to move the ERC20 tokens by turning them into a special native token on ADA. The new token will have equal value and functionality as ERC20. Also, the conversion works both ways as it can be reversed. To reverse the conversion users simply have to burn the special token on ADA and proceed to use the original token on ETH as usual.