Although even before today’s Covid-related market correction the price of $ADA was heading down as the result of eToro announcing that it plans to delist $ADA on its U.S. platform, crypto quant Benjamin Cowen, Founder and CEO at “Into The Cryptoverse” says the death of $ADA is greatly exaggerated.
It all started on Tuesday (November 23) crypto exchange eToro announced on its website that due to regulatory concerns, it would be “limiting ADA and TRX” for users based in the U.S. and that these users would “no longer be able to open new positions in, or receive staking rewards for, Cardano (ADA) and TRON (TRX)” but would be “able to close existing positions.”
Here are some important things to be aware of:
- Users based in the U.S. will not be able open new $ADA or $TRX positions starting on 26 December 2021.
- Users based in the U.S. will not be able to enjoy staking rewards for $ADA and $TRX since staking support for these two assets will end on 31 December 2021. Final rewards (in USD) will be paid out on 15 January 2022.
- Users based in the U.S. will still be able to maintain their existing $ADA and $TRX balances on the exchange. They will also be able to close their positions, i.e. sell their $ADA and/or $TRX holdings for USD; however, sometime in Q1 2022 eToro will also limit the selling of such holdings.
- eToro is trying to make the eToro Money crypto wallet compatible with $ADA and $TRX (hopefully early in 2022).
This unexpected move by eToro forced Charles Hoskinson, Co-Founder and CEO of IOHK (aka “IOG”), the blockchain technology firm responsible for Cardano’s research and development, to take to YouTube to clarify some of the confusion surrounding this news.
In summary, Hoskinson said that (1) neither the Cardano Foundation nor IOHK had been contacted by any financial regulators about $ADA; eToro’s move is the result of lack of regulatory clarity around cryptoassets; and although it is unfortunate that eToro felt it had to take this action, the de-listing of $ADA on the eToro platform in the U.S. will have no meaningful impact on the liquidity of ADA for the following reasons:
- $ADA is one of the most liquid cryptoassets in the market;
- eToro was not handling a huge amount of $ADA trading volume; and
- last Thursday (November 18), Bitstamp, which is one of the largest (if not the largest) crypto exchanges in Europe, announced that it was preparing to list $ADA.
According to data by TradingView, a day before eToro’s announcement $ADA was trading as high as $1.83 level and the day after the announcement, $ADA was trading around as low as $1.59.
Well, yesterday (November 25), prominent crypto quant Benjamin Cowen told his over 425K Twitter followers that this is not the first time that Cardano’s critics have been launched attacks against $ADA using FUD and that there was lots of FUD around even when $ADA was trading around $0.02 but these people failed to stop $ADA’s run all the way to $3 (in fact, $ADA’s all-time high was reached on September 2).
Cowen went on to suggest it was foolish for $ADA HODLers to panic sell just because eToro does not want its U.S. based users to buy $ADA or earn staking rewards for $ADA.
Cowen also reminded us that even with the price correction $ADA has had as the result of eToro’s announcement, $ADA was still trading a lot higher during Thanksgiving 2021 than during Thanksgiving 2020 and that it was trading a lot higher then than it was in the preceding Thanksgiving.
And on Tuesday (November 23), Hoskinson, pointed out that although a lot of people are panicking about eToro’s announcement, in reality, eToro has not de-listed $ADA for all of its users (i.e. it just plans to limit access to $ADA for those users based in the U.S.) and furthermore, the day after eToro’s announcement, $ADA got listed for the first time on Bitstamp, which is a much larger crypto exchange.
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.