The largest decentralized exchange on Cardano, Minswap, is gearing up to become the first decentralized exchange on the network to enable Bitcoin trading. The transition will depend on the progress of Cardano towards Bitcoin interoperability, which is a long-awaited move that may bring native BTC to decentralized finance.
Andrew Throuvalas, the senior content manager at BitcoinOS, believes that Minswap occupies a privileged place in the Cardano ecosystem. Minswap will be the largest DEX on a UTXO-based smart contract platform, making it the natural leader in adding Bitcoin DeFi functionality.
Its technical basis and proven liquidity put it in a good position to be the first BTC-enabled DEX on Cardano. According to DeFiLlama, Minswap now has more than $83.43 million in total value locked, or over a quarter of the entire Cardano DeFi sector.
Cardinal protocol sets the stage
Charles Hoskinson , the founder of Cardano, unveiled the Cardinal Protocol earlier this month, a Bitcoin DeFi solution that was born to enable decentralized capabilities on BTC. The protocol will enable the lending, swaps, and yield farming capabilities of Bitcoin holders on Cardano.
The announcement of the protocol served as a breakthrough in developing cross-chain DeFi. Bitcoin, which currently has a market capitalization of $2.2 trillion, has yet to be fully utilized in DeFi because of technical impediments. Cardano proposes to address this through its extended UTXO model and off-chain computation plans to achieve smart contract execution with BTC.
Hoskinson has said that unlocking Bitcoin DeFi may represent a trillion-dollar opportunity, introducing capital efficiency to the largest digital asset. The Cardinal Protocol is considered a foundation stone of that vision, as it will provide the plumbing required to bring Bitcoin liquidity into Cardano-native dApps.
In Bitcoin DeFi, timing can become a crucial aspect of becoming a leader. The availability of Minswap and the emphasis on cross-chain capability in Cardano provide a confluence that supports early adopters. With users seeking more opportunities to utilize BTC than merely holding it, decentralized financial services platforms seem set to gain more traction.
The early lead that Minswap has managed to acquire may result in an increase in trading volume, user activity, and protocol revenue. It currently has a solid market position in Cardano with $83 million TVL. By adding Bitcoin to its list of supported assets, that number may rise substantially, particularly should network activity-driven demand grow in the aftermath of the Cardinal Protocol launch.
ADA price builds toward potential breakout
With the infrastructure improvements in Cardano, ADA is testing a major resistance area. The token is trading right under the $0.7 mark, with analysts predicting a breakout once it surpasses the $0.77 mark. Renowned crypto analyst JavonTM1 predicts that, based on Fibonacci levels, Cardano may be aiming at $5.35 in a fresh bull run.
Another market analyst, Ali, indicates that continued movement above $0.77 will activate a bullish trend. Prominent analyst Crypto Winkle pointed out that ADA has built strong support between 0.63 and 0.67, where it is still recovering. The token is currently testing resistance at around $0.70- an area that has monitored gains over months. Winkle added that a decisive break above $0.70 may result in a sharp move up to the $1.60 level.
Source:X
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