Cardano breaks $1 and mirrors the 2021 bull market following the release of the CIP-113 proposal

Cardano (ADA) has surged over 10.75% in the last 24 hours, recently crossing the $1 mark to sit at $1.0481. This price movement raises questions about whether Cardano can replicate the success of its 2021 bull market. Trading volumes have also increased by 23%, reaching $1.62 billion, signaling a renewed interest in the cryptocurrency. The $1 price point represents a significant psychological milestone for ADA, especially after months of trading below this level.

Why is Cardano’s price rallying?

The recent price increase can be attributed to a combination of blockchain upgrades and a general market optimism. One of the major drivers of this rally is the release of Cardano’s CIP-113 proposal on January 2, 2025, which aims to introduce programmable assets, enhanced security features, and smart accounts. Charles Hoskinson, Cardano’s founder, has emphasized that the blockchain is evolving into a multi-chain, multi-actor network, with upcoming updates like Midnight preparing the way for the tokenization of real-world assets by 2025.

Furthermore, Cardano has entered its Voltaire era, marking a critical step toward decentralized governance. Additions like Mithril will also improve the performance of Cardano’s nodes. Another innovative development is the optimization of decentralized applications (DApps) through incomplete transaction processing, which allows partial transactions to be processed, expanding the user base.

As trading activity increases and the overall market recovers, ADA’s value continues to climb.

Cardano imitates 2021 bull run

Cardano’s recent rally is drawing comparisons to its historic 2021 bull run, with on-chain metrics showing an increase in daily and 30-day active addresses. This trend mirrors the activity seen during ADA’s surge past $3 in 2021, which was driven by anticipation of the Alonzo upgrade. Although current activity levels are not yet at the heights of 2021, the upward trend in address activity supports the breakout above the $1 threshold.

While on-chain data hints at a potential repeat of the 2021 bull run, ADA’s ability to reclaim its previous highs will depend on ongoing adoption of the platform and broader market conditions. For now, all eyes are on ADA as it navigates this critical phase in its development.