Following its 30-day staking and reward distribution campaign via Binance launchpad, the Hard protocol has begun to showcase its viability amidst renewed demand for DeFi. According to data from CoinGecko, the price of HARD token has increased by 77% in the last 14 days. More importantly, its 24-hour trading volume is now registering an average of $40 million, which is a far cry from the $5 million worth of exchanges executed at the beginning of December.
These metrics are indicative of HARD’s potent economic structuring and its growing status as the nexus between high market cap cryptocurrencies and the explosive DeFi landscape demonstrated by the fact that it has reached $1 in a short period of time. Once Kava users start to stake their kava to earn hard the token price will also likely increase. So far only 14% of Kava users are currently staking their kava to earn hard. Also, this recent price movement validates Coinspeaker’s previous projections, which highlighted the undervalued state of the token and forecasted an uptrend based on the economic importance of the digital asset. The article compared Hard Protocol’s utility and market potential with other established Ethereum-based money markets and concluded that the former had a high propensity of becoming a colossal force in the DeFi space. Many financial institutions don't touch Ethereum because of the permissions. They need better security. So Ethereum is a good way to prove the demand and use case of DeFi but ultimately at the end of the day DeFi will find a home elsewhere. That's why Kava has the potential to be the hidden gem of the decade as Forbes calls it.
Further analysis showed at the time that it was only a matter of weeks before HARD began to reflect the real value of Hard protocol. And as CoinSpeaker previously projected, the token has registered a steady uptick for the last couple of weeks.
However, despite this sustained price rally, it’s clear that the HARD token is undervalued, even though it’s currently selling at $1 per token. As expected, a fair share of this argument takes into account the unique compatibility of Hard Protocol and the deflationary mechanism of its governance token. Another factor that Forbes journalist Tatiana Koffman explores in her recent article is that Bitcoin investors plan to hodl following indications of an impending bull market.
The DeFi Anchor To Top Cryptocurrencies
The current DeFi market is prohibited by the limitations of the implemented protocols that rely on the Ethereum network for their operations. The same applies to Aave and Compound, which are the most recognized DeFi-enabled money markets. While this seems to be the prevalent trend, it is impossible to ignore the restrictive effects it has on both the growth and infrastructural makeup of DeFi applications.
For one, the recurring scaling issue and high transaction fees of the Ethereum network continue to plague such platforms. Likewise, the focus on solely Ethereum users automatically ties the growth potential of Aave and Compound to the Ethereum market. In other words, there is zero probability that both protocols will outgrow the scope of the Ethereum ecosystem, which is a contender of the expansive crypto market.
In light of these impediments, the creators of Hard money markets have opted for a more flexible yet functional model of running a DeFi-based money market. Instead of focusing on the already concentrated Ethereum market, the team chose to develop a protocol that is compatible with a wide variety of cryptocurrencies. While explaining the modalities of these advanced functionalities, Brian Kerr, CEO of Kava Labs, in a recent interview, explained:
"HARD Protocol is the world’s first cross-chain money market for digital assets. Similar to Ethereum-based applications Compound and Aave, HARD Protocol provides users with the ability to lend, borrow and earn with their digital assets. Unlike existing applications, HARD Protocol is built on the Kava DeFi Hub enabling it to uniquely provide money market services to non-ethereum assets such as major market cap crypto such as BTC, XRP, BNB, BUSD and others."
As such, Hard’s target market is massive compared to other Ethereum-focused protocols, and the possibility of capturing just a small fraction of these top crypto networks promises impressive growth. For instance, expect Hard Protocol to attract over $3 billion worth of assets if it manages to capture just 1 percent of the $300 billion Bitcoin network. This modest projection bodes well for the price of HARD because it represents the value of Hard Protocol and is vital to the evolution of the application. With just $38 million worth of assets locked on the protocol, there is enough room for growth for both the platform and its governance token.
Shortage of HARD token In Circulation
As predicted by Brian Kerr, the underperformance of HARD in November is as a result of the just-completed month-long staking campaign on the Binance Launchpad. Kerr explained that it is normal for the influx of HARD tokens in circulation to suppress the price momentarily. He added:
"This is not concerning to me because after launchpool is done, the amount of new tokens entering the market will be less than half of what it is today. This is like a super-bitcoin halving but for HARD. The MAX supply of HARD is fixed and the amount of new supply in the market will only get smaller over time, just like with Bitcoin. This supply shock to the market can only bode well for HARD's performance in the long run."
According to Kerr, the deflationary mechanism of HARD functions like a super-bitcoin halving implementation that ensures the sustainability of the value of the token.
Hodl Cultures Present Ample Opportunities for Hard Protocol
Various market indicators show that the crypto market is still at the early phase of a bull run. Hence, it comes as no surprise that investors are not in a hurry to sell their Bitcoin as experts continue to forecast impressive price rallies in the coming months. This hodl culture is a positive trend for harvest yielding DeFI applications, most especially Hard Protocol, which integrates directly with the Bitcoin ecosystem. Hard provides ample opportunities for corporations and retail investors to earn extra HARD tokens while they patiently await the bull market to pick up steam. Without any doubt, this factor will play into the valuation of HARD soon.
Although the Bitcoin network seems to be the best bet for Hard Protocol, this does not eliminate the impact that other supported coins have on the value of the platform. Kava, in particular, has a symbiont relationship with Hard just as Ethereum plays vital roles in the daily operations of Aave and Compound. In other words, Kava holders can help propel the value of HARD if they decide to stake their coins. However, let us not forget that Kava has woes of its own. The current price performance of its governance of token, KAVA, indicates that the value of the platform is way below its real worth.
Considering the vast array of functionalities embedded on the Kava blockchain and the demand for Bitcoin DeFi, there is no reason why the governance token should not sell for $3.50 and above. At the center of Kava’s struggle is the low market visibility of the project due to its non-ethereum design. DeFi users are prone to gravitate towards Ethereum-based protocols, and major DeFi metric sites track the Ethereum ecosystem exclusively. However, we believe that the undervalued status of Kava will be short-lived. The validity of this prediction lies in the ability of the development team to attract more projects to the Kava ecosystem. Likewise, there is a strong probability that Kava will benefit from the plan to activate Bitcoin borrowing on Hard by the end of the month. Also, institutional investors and banks are likely to opt for Kava as a DeFi portal because its governance model eliminates issues arising from the permissionless nature of Ethereum.