Cardano, the prominent blockchain platform, recently introduced a pivotal modification to its staking parameters, reducing the minPoolCost parameter from 340 to 170 ADA. The Cardano Foundation announced this update on October 24, 2023, marking a significant milestone for the ADA ecosystem.
Cardano Foundation Announcement
The Cardano Foundation took to X to share the news:
“As a result of the Stake Pool Operator [SPO]-Poll and a subsequent evaluation by the Parameters Committee, the Cardano Foundation has successfully submitted a transaction on the Cardano mainnet to lower the minPoolCost parameter from 340 to 170 ADA.”
This adjustment, which impacts staking pool operators, aims to create a more equitable environment and maximize participation from smaller pool operators.
Stake Pool Operator Reaction
Promptly embracing the new parameters, the Cardano staking pool, “Stake with Pride,” expressed its intention to adapt to the modifications:
“The Cardano min Pool Cost fee has been dropped to 170 ADA from 340. SPOs can drop their fees starting epoch 445 on October 27th.”
In a commitment to optimizing its policies in light of these updates, the pool ensured that its “minPoolCost” would remain at 170 ADA indefinitely, while temporarily adjusting its margin to 0% while assessing market dynamics.
Significance of the Update
The minPoolCost parameter, as previously highlighted in a September 13, 2023, blog post by the Cardano Foundation, served two primary purposes since its introduction during the Shelley launch in 2020. Firstly, it played a vital role in defending against Sybil attacks, and secondly, it guaranteed pool operators a minimum income to sustain their server operations.
Explaining the reasoning behind the modification, the Cardano Foundation stated, “By potentially halving minPoolCost we don’t enforce but allow the operators to reduce their ‘floor’ income.” The strategic change is expected to level the playing field for smaller pool operators, empowering them to compete more effectively in the ecosystem.
Cardano (ADA) Price Analysis
Aligned with the broader cryptocurrency market, the Cardano (ADA) price has witnessed a strong uptrend in recent hours. Presently, ADA is trading at $0.2761, reflecting a 6% surge over the past 24 hours.
Analyzing ADA’s 1-day chart, it becomes evident that the asset recently broke out of a six-month downtrend. Notably, on April 15, ADA reached its yearly high of over $0.46. Since then, the price has experienced a downward trajectory.
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However, the recent breakout has allowed ADA to overcome the crucial 0.236 Fibonacci retracement level at $0.277. Impressively, the price has withstood a retest of this level and established it as new support on lower time frames. A daily close above $0.277 could further bolster the bullish outlook for Cardano (ADA).
The next significant resistance ADA must overcome is the 200-day exponential moving average (EMA) at $0.299, often referred to as the “bull line.” Breaching this level could propel ADA back into a bullish state. Notably, the digital asset has struggled to complete a daily close above the 200-day EMA since mid-July.
Should bullish momentum persist, the Fibonacci retracement levels become key targets, including 0.382 at $0.313, 0.5 at $0.341, 0.618 at $0.370, and 0.786 at $0.411. The ultimate goal remains the annual peak of $0.463, indicating a potential rally of 65% from its current value.
Adedoyin is a graduate of Law and a Crypto & Blockchain expert who strongly believes that Blockchain is the future. At TimesTabloid, she focuses on crypto and blockchain educational content.
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