Is Cardano a Good Investment?

Wondering if Cardano is a good investment in 2025? Our guide covers everything you need to know about Cardano including growth, price history, and more.

What is Cardano?

Cardano is a smart contract blockchain founded by Ethereum co-founder Charles Hoskinson, with ADA as its native cryptocurrency used for transaction fees. Designed to support decentralized applications like DeFi protocols and NFTs, Cardano distinguishes itself from other smart contract blockchains such as Ethereum and Solana by taking a slow, research-driven approach to development.

All upgrades undergo a rigorous peer-review process conducted by Cardano’s development team, IOHK, which involves both internal software engineers and external university partners. While this method slows development, it ensures that all changes are backed by evidence-based research. Supporters argue that this approach prioritizes accountability and error-checking, ultimately helping Cardano deliver low fees, fast transaction speeds, and environmental sustainability.

Read next: Best Cardano Wallets

Is Cardano growing? 

Cardano has experienced significant growth in recent years. As of 2024, the total locked value of all Cardano-based assets surpasses $400 million, with over 94 million transactions recorded on the blockchain. In September 2024, smart contract usage increased by 31%, and the network's user base expanded to over 4.8 million wallets.

Like many other altcoins though, the currency is struggling in early 2025.

Cardano key features

• PoS consensus: Cardano utilizes the energy-efficient Ouroboros proof-of-stake protocol, which, according to Cardano, is four million times more energy-efficient than Bitcoin.

• Two-layer architecture: With separate layers for computation and execution, Cardano offers a more efficient, flexible, and scalable structure than other smart contract blockchains.

• UTXO model: Unlike Ethereum, Cardano uses the UTXO model for tracking crypto balances, which enhances privacy and scalability.

• Peer-reviewed upgrades: Every Cardano update is based on academic research, ensuring a focus on security and scalability.

Read next: Where Can I Stake Cardano?

Cardano's historical price performance

Since its launch in 2017, Cardano has experienced significant price volatility, with its value surging during bull markets. Its all-time high was reached in 2021, when ADA peaked at $3.10, making Cardano the third-largest cryptocurrency by market capitalization, behind Bitcoin and Ethereum.

At its peak, Cardano was considered the leading ‘Ethereum killer,’ as Ethereum struggled with high fees and had not yet transitioned to a Proof of Stake system. However, in the years that followed, other competing blockchains, such as Solana, surpassed Cardano in user growth.

As of 2025, Cardano remains a top ten cryptocurrency by market capitalization but continues to experience significant price volatility and is struggling to get close to its previous ATH.

Will Cardano explode in the future? 

Cardano’s future growth relies on successfully expanding its smart contract ecosystem and attracting users to its dApps. The value of blockchains like Cardano increases as more projects and users join the network. While it has lagged behind competitors, investors remain optimistic that developers will be drawn to Cardano’s unique, research-driven approach.

Despite this optimism, predicting the future value of any cryptocurrency remains uncertain. Prices are influenced by a variety of unpredictable factors, including market conditions and overall demand.

What are the pros of investing in Cardano?

• Capped supply: Like Bitcoin, Cardano has a fixed maximum supply, creating scarcity that could drive price increases over time.

• Energy-efficient: Cardano’s Proof of Stake model is praised for its environmental sustainability.

• Research-driven development: Every upgrade undergoes peer-reviewed research, ensuring fast speeds, low fees, and a scientifically grounded blockchain structure.

• Continuous development: Cardano is consistently improving, with the recent Chang Hard Fork enabling user participation in governance.

• Partnerships: Cardano collaborates with major financial institutions, including the European Investment Bank and the Japan Bank for International Cooperation.

What are the cons of investing in Cardano?

• Slow development process: Cardano’s peer-reviewed approach has delayed key features. Although launched in 2017, it only introduced smart contracts in 2021—long after Ethereum and Solana had established DeFi and NFT ecosystems.

• Lagging behind competitors: Despite a strong foundation, Cardano has struggled to match the rapid innovation of Ethereum and Solana, which critics argue attract more users and develop at a faster pace.

• Market volatility: Like all cryptocurrencies, Cardano experiences significant price fluctuations, making it a risky investment for those seeking short-term gains.

Before investing in any cryptocurrency, it's important to weigh the pros and cons while considering your own financial situation. While Cardano’s research-driven approach has earned praise, it has also faced criticism for falling behind faster-moving competitors.

Read next: How to Use a Cardano Staking Calculator

Don’t forget the tax bill…

Whatever your investments, if you have gains or income from Cardano or any other crypto investments, you’ll have a tax bill. You can learn more in our crypto tax guides or sign up to Koinly free today to calculate your Cardano taxes.