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Apr 10, 2023
Tezos vs Cardano: Which One Is A Better Long-Term Investment?
tl;drTezos vs Cardano: which one is a better long-term investment? Both projects are well-known in the crypto world, but savvy investors look for juicy long-term potential. Keep scrolling to learn all about these two projects in comparison, from top features and architecture to price prediction and the latest developments, to see which one can better fit your crypto portfolio.
Using blockchain technology, Tezos is a decentralised platform to create smart contracts and decentralised applications (dApps). Tezos strives to provide a self-amending blockchain protocol growing over time without a need for hard forks.
This platform was created in 2018 to offer solutions to some of the problems faced by previous major networks like Ethereum, i.e., scalability, security, and governance.
Tezos network has introduced XTZ as its native token, which is used to pay transaction fees and earn voting rights to participate in governance.
Tezos comes with various features helping it stand out among so many crypto projects in the market. Keep scrolling to learn about Tezos’ main features.
Self-Amending Protocol: Tezos’ self-amending protocol enables upgrades and improvements without hard forks.
On-Chain Governance: Thanks to its on-chain governance system, Tezos lets stakeholders take part in governance and vote for upcoming changes, which makes the platform more decentralised in decision-making and governing.
Delegated Proof-of-Stake (DPoS) Consensus: Using a DPoS consensus mechanism lets Tezos be more energy-efficient than platforms using a Proof-of-Work (PoW). DPoS lets token holders delegate voting power to validators who add new blocks to the blockchain.
Smart Contracts: Supporting smart contracts, Tezos automates contract execution and decreases the role of intermediaries.
Formal Verification: To increase smart contracts’ reliability and security, Tezos applies a formal verification technique, which proves the correctness of software code.
Token Standards: Tezos follows its own token standards, i.e., the FA1.2 and FA2 standards, which are similar to Ethereum's ERC-20 and ERC-721 standards. Following these standards, Tezos lets fungible and non-fungible tokens be created on the platform.
From supporting smart contracts and dApss to on-chain governance, Tezos tries to provide features that expand its scope to involve more and more users.
After Tezos, we’ll get to know Cardano and learn about its basics, so we can start comparing Tezos vs Cadano and find out which one can be a better long-term crypto investment.
What Is Cardano?
Cardano is a well-known decentralised platform using blockchain technology that enables executing smart contracts and developing dApps using its own programming language, Plutus.
Cardano was created in 2017 to provide solutions for the sustainability, scalability and interoperability problems of giants like Bitcoin and Ethereum.
ADA is the token native to the Cardano network, which is used to pay transaction fees and enable users to participate in the governance process.
The following section introduces Cardano's most significant features to help you understand the projects, especially if you’re new to crypto.
Layered Architecture: One of Cardano's unique features is its layered architecture, which aims to increase efficiency and scalability. Cardano is divided into the settlement layer (to handle the token transfer and work as a ledger) and the computation layer (to handle smart contract execution).
Proof-of-Stake (PoS) Consensus: Using a PoS consensus mechanism means that Cardano is more energy-efficient with less environmental footprint than PoW platforms. PoS lets token holders stake their tokens as collateral to help secure the network, validate transactions, and earn participation rewards.
Sustainability: Cardano prioritises sustainability and strives to increase social and economic inclusion by being available in developing countries.
Peer-Reviewed Research Approach: Cardano gets help from academic experts worldwide to review and contribute to the platform's codebase, making the network more reliable and secure.
Formal Verification: To make smart contracts more secure and reliable, Cardano uses formal verification to prove the correctness of software code.
Interoperability: To increase interoperability, Cardano tries to cooperate with other blockchain platforms and seamlessly transfer assets and data.
Decentralised Governance: Cardano lets token holders get involved in the decision-making process by voting for changes.
Now that we know both platforms let’s start comparing them and see what their key differences are.
The Key Differences Between Tezos and Cardano
To help you see the big picture of the differences between Tezos and Cardano, before going into details, we’ve provided the following table, which depicts the key differences between the two projects.
The following section will review Tezos and Cardano’s price history to let you compare them and see how they have performed since their launch.
Tezos vs Cardano: Price History
Tezos (XTZ) was first traded on Jul 03, 2018, at $2.4.
Cardano (ADA) was first traded on Oct 23, 2017, at $0.02604513.
After some fluctuations, Tezos started a downtrend, which lasted for about four months and led to its lowest price, recorded at $0.350476 on Dec 07, 2018.
Cardano started an uptrend soon after its launch, reaching $1.18 on Jan 04, 2018.
Since its lowest price, XTZ has had a generally upward trend, reaching $1.84 in five months on May 20, 2019.
Despite its early jump, Cardano fell to a low range of about $0.082378 and moved steadily for about two years, and finally, on Mar 13, 2020, hit its lowest price level at $0.01925275.
Tezos kept the upward trend and recorded a trading price of $3.17 on Mar 07, 2020, almost when ADA was experiencing its worst days.
After a year of no big changes, ADA started 2021 with upward trends and reached $1.30 on Mar 01, 2021.
During the same days, XTZ was experiencing a lot of ups and downs and was trading at about $3.65 on Mar 02, 2021.
Cardano was still moving upward, and it could reach $2.17 on May 16, 2021.
In those days, XTZ coins were traded at a higher range, e.g., at $6.48 on May 15, 2021.
Cardano kept the uptrend and finally hit its highest trading price of $3.09 on Sep 02, 2021.
Tezos was also moving upward with a lot of fluctuations, and it finally recorded its highest trading price of $9.12 on Oct 04, 2021.
Since its highest price level, Cardano went on a downward journey and fell to $0.513527 on Aug 02, 2022.
Since its highest price level, Tezos was also moving downward, falling to $1.86 on Aug 06, 2022.
The downtrend continued for some months, and today on Apr 10, 2023, each ADA is traded at $0.388004.
The downtrend continued for Tezos too, and today on Apr 10, 2023, each XTZ is traded at $1.1.
This is how XTZ and ADA have performed financially since their launch. But there are other important factors affecting a crypto project’s overall success, like its Return on Investment, which we’ll learn about in the following section.
Tezos vs Cardano: ROI, ATL, and ATH
ROI (Return on Investment) is a financial indicator showing a given cryptocurrency's profitability in various time frames. ROI is shown in positive and negative numbers, and when it’s negative, it means that the cryptocurrency in question has incurred financial loss instead of profit.
The following table summarises the ROI of Tezos vs Cardano.
As the above table shows, although Cardano is performing in a lower price range, it’s been more profitable than Tezos over the mentioned time frames.
The table below displays the ATL and ATH prices of Tezos vs Cardano, compared to their current price range.
The following sections will compare Tezos and Cardano from fundamental and structural aspects, including
Their Latest Developments,
Transaction Speed, and
to reach the final question of which of the two projects is the best for a long-term investment.
Tezos vs Cardano: Consensus Mechanism
The table below compares the consensus mechanism of Tezos vs Cardano.
Tezos vs Cardano: Architecture
Tezos has the following architectural features:
It tries to be a self-amending blockchain, meaning it can upgrade itself through on-chain governance mechanisms.
Tezos has a layered architecture, including the network layer (to manage peer-to-peer communication between nodes), the transaction layer (to handle creating and validating transactions), and the consensus layer (to handle block validation and consensus).
Tezos uses the Michelson programming language, which is safe and easy to verify to write smart contracts.
Cardano is a third-generation blockchain prioritising scalability, interoperability, and sustainability, with the following architectural features:
Cardano’s layered architecture has two layers: the settlement layer (to handle creating and validating blockchain) and the computational layer (to handle executing and developing smart contracts and applications).
Cardano’s programming language, Plutus (based on the functional programming language Haskell), is used to write smart contracts.
Tezos vs Cardano: The Latest Developments
Tezos’ latest developments:
Tezos completed its sixth protocol upgrade, Granada, in March 2021, which improved the gas model, reduced the cost of executing smart contracts, and upgraded the consensus algorithm and the baking process.
Tezos is growing its presence in the NFT space and has had many famous NFT projects launched on the Tezos platform, like the $69 million sale of Beeple's NFT "Everydays: The First 5000 Days".
Cardano’s latest developments:
Cardano has recently upgraded its "Mary" protocol, which enabled the creation and execution of native tokens on its blockchain. This upgrade led to the launch of Cardano's Goguen era, i.e., smart contract functionality and application development.
Cardano has let various DeFi projects be launched on the network, e.g., Minswap DEX and the stablecoin Djed.
Tezos vs Cardano: NFT
This is how Tezos treats NFTs:
Tezos allows various NFTs on its platform, so it is well-suited for NFTs thanks to low transaction fees and supporting smart contracts.
Tezos has its NFT standard, FA2, streamlining the creation and management of NFTs for developers on the network.
Some famous NFT projects on Tezos are Hic et Nunc (an NFT marketplace) and Kalamint (a platform to create and sell NFTs).
Cardano is relatively new to the NFT space but has the potential to become more involved and active in this area. This is how Cardano treats NFTs:
Since Cardano allows smart contract functionality and application development, it is a suitable platform for NFTs.
Cardano’s native token standard, Cardano Token Registry, allows NFT lovers to create and manage NFTs on the network.
Some early NFT projects on Cardano are SpaceBudz (a collection of space-themed NFTs) and CardanoKidz (a collection of cute and collectable NFTs).
All in all, both projects are suitable for NFTs because of low transaction fees, supporting smart contracts, and native token standards. Tezos has a longer record in the NFT market, hosting numerous NFT projects. Cardano is in its early steps concerning NFTs but has enough potential to attract more NFT projects.
Tezos vs Cardano: Fees
The following table summarises how the fee systems work in Tezos and Cardano platforms.
Tezos vs Cardano: Transaction Speed
Tezos’ block time is about 60 seconds, which is not the fastest block time among all blockchain platforms in the market, but it is faster than traditional financial systems.
Also, Tezos can process up to 40 transactions per second, but the actual transaction throughput varies based on network conditions and the complexity of the transactions.
Cardano’s 20 seconds block time is almost three times faster than Tezos'.
Cardano can process up to 257 transactions per second (TPS), but in practice, the transaction throughput varies based on network conditions and transaction complexity.
Generally, Cardano has a better block time and a higher potential transaction throughput than Tezos. However, both Tezos and Cardano prioritise scalability and will improve handling, increasing levels of network activity over time.
Tezos vs Cardano: Price Prediction
Price predictions are great for letting investors know the crypto experts’ expectations of the cryptocurrency’s future performance. Just remember that no price prediction is 100% reliable as the crypto market is too volatile, but it helps you get a general picture of the coin’s upcoming price changes.
The following table compares the price predictions of Tezos vs Cardano in the coming years, from 2023 to 2030.
Tezos vs Cardano: Which One Is Better?
Tezos vs Cardano: which one is better? Well, the answer lies in many factors. Speaking of architecture and structure, we saw in this article that both projects are well-established and have plans to grow even more and become more accessible.
Regarding ROI, which is one of the most important factors in choosing a cryptocurrency as an investment option, Cardano has performed better than Tezos.
However, considering price performance and prediction, we witnessed above that Tezos has been traded in a way higher range than Cardano. Experts predict a maximum price of about $27 for each XTZ but only about $8 for each ADA in 2030.
Although Cardano is being traded in a lower price range, it can be ideal for investors who don’t want to spend a lot on cryptocurrencies and can wait longer.
Having said that, Tezos has the potential to grow significantly in the coming years, but we also need to remember that its recent year ROI hasn’t been so profitable.
Last but not least, it’d be a good idea to invest in both Tezos and Cardano as each one has its own benefits and potential.
Tezos and Cardano are two famous blockchain platforms that have been performing reputably in the crypto sphere. While each platform has its unique features and strengths, the question of which one is a better long-term investment is still asked by many crypto enthusiasts.
Tezos prioritises formal verification and offers a variable transaction fee system, while Cardano prioritises sustainability and has a more predictable fee system. All in all, to choose one of the two as better for long-term investments, you need to weigh your options, set your priorities and risk tolerance and study market movements.
The following most frequent Q&As will shed more light on Tezos vs Cardano for those who still have unanswered questions.
Does Tezos Have A Future?
Yes, Tezos is expected to surpass its ATH in the coming years (about 2027) and hit new highs. Also, each XTZ coin is predicted to be traded for at least $22 by 2030.
Will Tezos Reach 100 Dollars?
It seems unlikely that Tezos can reach $100 any time soon as it needs to grow by about 90 times its current market price to pass the $100 price range. On its ATH in October 2021, XTZ tokens grew by about 3.33 times in almost three months.
Will Cardano Be The Best?
Many crypto gurus believe that Cardano will have a share in the future of crypto, and it’s worth noting that it’s currently a well-known and active cryptocurrency, and many have high hopes for it in the coming years.
Can ADA Reach $100?
ADA’s current price needs to grow by 270x for each ADA coin to reach $100, which seems highly unlikely in the near future, especially for an asset with a market cap of $12.7 billion. The only possible way for ADA to hit $100 is for its supply to be dramatically decreased.