Cardano’s ADA Surges 11% After Grayscale’s Spot ETF Filing, Outperforming Bitcoin and Ether
Cardano’s ADA token saw an 11% increase, outpacing both Bitcoin (BTC) and Ether (ETH) after Grayscale Investments filed for the first-ever spot ADA exchange-traded fund (ETF) in the U.S.
According to CoinDesk data, ADA reached 80 cents, beginning its upward movement late Wednesday. Despite the recent surge, the ninth-largest cryptocurrency by market capitalization remains 36% below its December peak of approximately $1.37.
Grayscale, a well-known crypto asset manager, has filed to list the first spot ADA fund on the New York Stock Exchange. A spot ETF would allow investors to gain exposure to ADA without directly owning the cryptocurrency.
In 2024, Bitcoin and Ether spot ETFs were approved and began trading in the U.S., attracting billions in investment and further promoting institutional adoption of crypto assets.
The U.S. Securities and Exchange Commission’s approval of the Bitcoin and Ether spot ETFs relied on the assumption that the CME’s surveillance system for futures trading would prevent price manipulation. In essence, futures contracts have been a key requirement for spot ETF approval. However, the CME has not yet listed ADA futures.
Despite this, the market seems undeterred, as reflected in ADA’s price spike.
Shift Towards Layer 1 Coins
The crypto market is seeing a shift in focus from meme coins to Layer 1 assets like Bitcoin, Ethereum, Solana, Toncoin, and Cardano. According to analytics firm Santiment, social media discussions around Layer 1 assets now make up 44.2% of coin-related chatter, while meme coins like Dogecoin, Shiba Inu, and Pepe are becoming less popular.
Santiment believes that this transition to Layer 1 coins signals a more stable and sustainable market environment.
Bitcoin’s Price Action and Macro Outlook
Bitcoin continues to trade in a relatively narrow range between $95,000 and $100,000. The price action has been constrained by concerns over trade wars and rising inflation expectations in the U.S. Meanwhile, Ether remains locked between $2,500 and $2,900 since it recovered from a crash to $2,000 last week.
Macro traders have recently shifted attention to gold, which has surged to new all-time highs above $2,900 per ounce.
Some analysts, however, believe Bitcoin’s long-term potential remains intact despite short-term fluctuations.
“Bitcoin’s decreasing volatility, combined with the rise of gold prices, highlights Bitcoin’s growing appeal as an alternative store of value,” said analysts from Bitfinex. “Bitcoin’s narrative as a hedge against inflation and currency devaluation continues to attract increasing institutional interest.”
Analysts also pointed out that Bitcoin’s fixed supply is becoming more attractive as central banks expand money supply and fiat currencies face devaluation risks. With more than $196 billion worth of Bitcoin held by ETFs, public companies, and even nations, some suggest a shift away from gold may be underway.
