People's interest in crypto wanes in a bear market. This also applies to Cardano. However, some trends are positive. Come take a look at the statistics and think about the results. It might surprise you that meme coins can beat Cardano. What does this indicate? What does Cardano need to succeed?
The decline in interest in crypto is palpable
Let's first look at how Cardano has performed in statistics over the past 5 years.
We used Google Trends, which is a useful tool for anyone who wants to understand what people are searching for on Google, and how their search behavior changes over time and space. Take into account, that Google Search is not the dominant search engine in every Asian country. However, for the purposes of the article, this is enough for us.
We can see that the most interest in Cardano was in 2021, which was a bull market year for the entire cryptocurrency market. We can currently see a 90% decline in interest from the peak.
On the positive side, interest in Cardano is higher than in 2020, roughly by half.
If we add the two most famous projects Bitcoin (blue) and Ethereum (red) to the statistics, we see that they are doing very similarly to Cardano (yellow).
Interest in Bitcoin plummeted by 84%. People search for information about Bitcoin 8x more often than Ethereum. Compared to Cardano, the difference is 16 times.
With Bitcoin, we can observe occasional peaks. This can be caused, for example, by the fall of the FTX exchange, or by speculation about the launch of ETFs. Bitcoin is the largest cryptocurrency, so positive and negative events attract media attention.
Interest in Bitcoin is currently similar (or only slightly higher) as in 2019 and 2020. It is possible that people are already familiar with Bitcoin and do not search for information about it as often. It may also be that Bitcoin does not have DeFi, so people do not need to find out specific information about DeFi services, unlike SC platforms.
It is also interesting that Ethereum is not significantly better than Cardano in terms of statistics. People search for information about Ethereum only about 3x more often than Cardano. This is a surprising result and I would have expected a bigger difference in favor of Ethereum.
You can see the comparison of Ethereum (blue) and Cardano (red) in the chart below.
While we can observe a persistent decline in interest in Cardano, there are occasional peaks in the case of Ethereum. This can be caused by, for example, the transition to Ethereum 2.0, or some big hacks.
For context, let's look at how often people searched for information about Bitcoin (blue) and AI (red).
In 2020, AI was essentially a marginal topic that not many people were interested in. AI only slightly outperformed Bitcoin in the statistics. In the bull market, Bitcoin clearly won the attention of the people. With the advent of ChatGBT, we can observe the skyrocketing interest of people in AI. It continues for now.
Simply put, Bitcoin is about as interesting to people as AI. Significant events can gain attention in the short term. If you think that most ordinary people are not very interested in AI, judging by the statistics, Bitcoin is in a similar situation. Ethereum and Cardano are even worse off than Bitcoin.
In the case of AI, we do not yet know if interest will fall or remain. People's attention can be maintained if new services appear on the market.
Let's take a look at the chart where we look at Cardano (blue), Dogecoin (red), and Shiba Inu (yellow). Meme coins beat Cardano in statistics.
In the bull market, there was significantly more interest in meme coins than in Cardano. Currently, people's interest in these projects is roughly similar, however, meme coins can peak more often.
The most frequently cited reasons why people lose interest in cryptocurrencies are high volatility, high frequency of hacks, and fraud. The crypto market is also criticized for its environmental impact, especially for those projects that use Proof-of-Work (PoW) as their consensus mechanism. Other reasons are low utility, regulatory uncertainty, or lack of education. However, these reasons may not be as significant as the ones mentioned before.
What do the statistics indicate?
It is clear that the interest of ordinary people in cryptocurrencies is driven mainly by speculation. People are not very interested in terms like smart contracts, Proof-of-Stake, or decentralization.
Never mind that people don't care about the technological details. Understanding how Proof-of-Stake or a smart contract works is similar to asking people to know how a touch display on a phone works, encryption on the Internet, or machine learning. Most people don't know this and yet they are able to use modern technology.
It is not important how things actually work, but how people can benefit from using technology.
What people should be more interested in is the term decentralization.
The concept of decentralization is the foundation of the entire blockchain industry. If people do not understand the principles and benefits of decentralization, further adoption will be difficult. It is apparent that many people buy into cryptocurrencies without understanding their mission and potential benefit to society. Most people only speculate on the growth of their market value.
This finding is particularly unpleasant in the case of Cardano, as the community cares about the high decentralization of the project and is interested in introducing on-chain governance. You don't even need to enter this term into Google Trends. I'll tell you straight away that ordinary people have no idea what it could be.
It seems that it makes no sense to compare individual projects with each other regarding decentralization because it is uninteresting for people and they themselves do not know what is actually important. Still, they are willing to use DeFi, stablecoins, and NFTs. See the chart below:
The NFT sector has shortly managed to be as interesting to people as the market value of BTC. Interest in DeFi and stablecoins is slowly growing.
People are not interested in the technological details, but they are interested in the use of blockchain, i.e. utilities.
If it is economically beneficial for people to use DeFi services, they will use them. If merchants accept stablecoins, part of the population will pay with them. If there is high volatility in national fiat currencies in developing countries and people have access to stablecoins on the blockchain, this will be a solution to the problem for them.
The blockchain industry needs people to start using services on blockchain on a daily basis. People must perceive blockchain as a useful technology that they can use for their own benefit. Speculation is not a utility in the context of Western financial services such as payments, loans, etc.
In the blockchain sector, there are a huge number of speculators and few real users. This has to turn around. Speculators and investors must be in the minority, just like in other industries. There are a huge number of iPhone users in the world, but far fewer Apple shareholders.
What is the ratio between speculators and real users? There are roughly 550M cryptocurrency holders. Most of them hold cryptocurrencies on centralized exchanges. On-chain services are used by approximately 2-3M users daily. I estimate that there may be 300 times more speculators than real users.
From my point of view, it is unbelievable that people are more interested in meme coins than Cardano. I don't want to offend the holders of the aforementioned meme coins, but the technological difference and potential between them and Cardano is huge. I believe that the mission of the Cardano project is important and can be beneficial to many people. Meme coins have no meaning other than speculation. Many people can lose money.
It is good to ask what the Cardano community can do differently when all the efforts of teams and all builders are overshadowed by meme coins. There are many members of different meme armies, so the Cardano community will have a difficult time. It is important to explain the mission of the Cardano project to newcomers. They must not think that the blockchain industry is only about speculation. They need to understand that this is about the development of decentralized technology and that it takes time. It is necessary to explain to people that if the technology can be delivered, what impact it can have on society.
People don't care about decentralization, but without it, the blockchain industry doesn't make sense. VC funds will invest in centralized solutions and I believe people will use them. Does Cardano have a chance to succeed just because of the quality of its decentralization?
Arguing that people should use Cardano because it is supposedly the most decentralized may not work. This is the reality we have to deal with. Cardano must remain decentralized while offering useful services to people. Cardano needs to gain ground in DeFi and needs to have USD-backed stablecoins as soon as possible.
Decentralized projects have arisen only because centralized services and institutions fail. I believe that centralized or poorly decentralized blockchains and DeFi services will fail sooner or later.
When that happens, Cardano must still be here to take on disappointed users. I believe that decentralization will win out in the long run. If not, we are building a banking system 2.0, which only looks decentralized, but is basically the same as the current one.