ADA Has 75% of SOL's Market Cap, but Cardano Has Only 16% of Solana's Daily Users, Says Bloomberg Analyst

Jamie Coutts, a prominent crypto market analyst at Bloomberg Intelligence, has cast a spotlight on the comparative market capitalization and user engagement levels between two major blockchain platforms, Solana (SOL) and Cardano (ADA). In a post on social media platform X, Coutts analyzed the current standings of SOL and ADA, which are ranked 7th and 9th by market cap in the crypto space, valued at $17.73 billion and $12.78 billion, respectively.

Coutts pointed out a notable discrepancy between the market cap and user activity of the two cryptocurrencies. He emphasized that Cardano’s market cap is 75% that of Solana’s, yet it only has 16% of Solana’s daily users. This observation suggests that Solana’s market share could increase if the trend of user engagement continues to favor it over Cardano. Coutts implied that there is more room for growth in Solana’s valuation relative to Cardano, given the current user base metrics.

Coutts also commented on the broader cryptocurrency market, particularly Bitcoin’s performance. Despite a 100% rally in 2023, he noted the prevalence of ‘firm hands’ in the market—investors who have bought Bitcoin at least twice and have not sold. The number of such Bitcoin addresses has reached an all-time high of 844,000, encapsulating over 3 million BTC or 16% of the circulating supply. This behavior, according to Coutts, is indicative of a strong HODLing sentiment, where long-term holders may drive up prices, especially if a spot Bitcoin ETF is approved by the SEC.

He further elaborated on this by referencing his “Bitcoin Residents vs. Tourists” chart, which contrasts the supply of Bitcoin last active over a year ago with that last active less than a year ago. This analysis provides insight into the holding patterns and potential market pressures that could influence Bitcoin’s price in the event of new investment inflows from ETF investors.

On 16 October 2023, Bloomberg Intelligence analyst Jamie Coutts discussed the increasing integration of traditional finance (TradFi) with blockchain technology, particularly in the tokenization of real-world assets. Coutts observed a steady rise in participation from traditional financial institutions, with a notable uptick in emerging markets. This trend coincides with the heightened use of stablecoins in these areas.

Coutts reported a substantial jump in the tokenization of US money market funds, which have reached a valuation of $600 million, up from $100 million earlier in the year. This reflects a burgeoning interest in leveraging blockchain for traditional financial assets, providing a more adaptable and decentralized approach to asset management.

Highlighting the key players, Coutts mentioned that entities like Franklin Templeton Benji Investments and Wisdotree Prime are leading the charge, having issued half of these blockchain-based assets. Franklin Templeton chose both the Stellar and Polygon networks for asset issuance, while Wisdotree Prime opted for Stellar.

In terms of network preference for asset issuance, Stellar has seen $321.2 million, Polygon $23.7 million, and Ethereum has the highest with $345 million. These choices may be influenced by factors such as transaction costs, speed, and network maturity.

Coutts concluded by emphasizing that while stablecoins are currently the primary driver for blockchain adoption, other areas like NFTs, GameFi, and Real-World Asset tokenization also present significant growth opportunities despite being in early development stages.

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