On February 3, Cardano did a hard fork and successfully integrated the Mary upgrade into the test network, transforming the blockchain into a multi-asset network similar to Ethereum.
That event appears to be one of the reasons ADA’s impressive year-to-date rally of 475% and the altcoin is now causing unexpected ripples in derivatives markets.
Since the end of December 2020, the open positions in ADA futures have increased from USD 81 million to currently USD 580 million and have become the third-largest derivatives market after Bitcoin (BTC) and Ether (ETH).
Data shows that this wasn’t a purely technical adjustment as Cardano’s on-chain and trade metrics far outperform Litecoin (LTC).
ADA futures aggregate open positions. Source: Bybt
A week ago, Litecoin led ADA’s open interest with a margin of 50% or more. This has changed in the past five days as Litecoin’s aggregate futures position has been reduced by 40%.
Despite a price correction similar to Litecoin between February 20 and 22, ADA had liquidations with a maturity of $ 125 million, which is approximately 19% of the open positions at that time.
ADA trading volume and on-chain metrics will be strengthened
Volume is the first and most important indicator of investor interest. Regardless of the price movement, low trading activity reflects a small user base or a lack of new entrants, which is particularly problematic for cryptocurrencies as an emerging asset class.
ADA and LTC 3-Day Average Spot Trading Volume, USD. Source: Messari Screener
Although ADA started from a much lower base three months ago, trading volume spiked in February while Litecoin failed to break the daily average of $ 2 billion. ADA’s total spot trading volume on exchanges is currently $ 2.8 billion.
Average 7 day ADA and LTC, USD transfers and transactions. Source: Coin Metrics
Cardano’s on-chain metrics also provide insights into the growing usage and open interest of ADA. The data shows that both networks had similar transmission and transaction value through November 2019. Cardano took over the lead by mid-2020 and received ten times more activities in the chain. That difference is now five times greater.
Overall, both trade data and on-chain metrics confirm the open interest of ADA futures turning Litecoin’s.
VORTECS ™ Score (green) vs. ADA price. Source: Cointelegraph Markets Pro
Data from Cointelegraph Markets Pro shows the number of tweets from unique accounts discussing Cardano is 24% above the 30-day average over the past 24 hours. Tweet volume is a component of the VORTECS ™ score, which was used to determine the optimistic conditions for ADA on February 18, ahead of the recent price hike.
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