Acala Token launched earlier this year with the intention of becoming an economic hub on the Polkadot (DOT) blockchain.
ACA is showing signs of recovery. After dropping to its all-time low on 7 September, the cryptocurrency has made some gains and was up 28% over the past week, according to CoinMarketCap, as of 14 September.
ACA to USD
What is Acala?
Acala is a decentralised finance (DeFi) ecosystem that was built on the Polkadot blockchain. The platform brings a variety of different products for users as it hopes to become the go-to “economic hub” on Polkadot.
Investors can trade tokens on Acala Swap, become liquidity providers, and gain “high-interest APY” rewards on their cryptocurrencies.
The ecosystem revolves around its Acala Dollar (AUSD) stablecoin, which has recently depegged from $1 and was trading at $0.74 on 14 September. Investors can access decentralised loans with AUSD.
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All about the ACA crypto
ACA is the native token that is used throughout the Acala ecosystem.
It powers its micro gas fees system, which the team describes as “Bring Your Own Gas”. This lets users pay for their transaction fees in the cryptocurrency of their choosing
ACA is also utilised by developers to deploy new “substrate pallets”, essentially allowing users to build on the ecosystem. However, developers must stake the token to access this.
Another utility for ACA is in the governance of the platform.
ACA price history
ACA went live on 25 January 2022 at $3.10 and was immediately thrust into the bearish crypto market. The cryptocurrency closed the month at $1.47
ACA/USD price chart, all-time performance
It saw a slight resurgence in February as the platform launched its AUSD stablecoin.
Acala wrote in a Medium post: “The goal of AUSD is to be the most useful form of decentralized stable currency in the Polkadot ecosystem, serving as the default pair, routing asset, and means of exchange among all users and developers.”
ACA climbed to a peak of $1.95 on 10 February, the launch day of AUSD. But it then plummeted to a low of $0.82 two weeks later on 24 February.
The cryptocurrency’s next surge came in April. Acala had integrated the Talisman wallet and the Wormhole interoperability protocol that month. ACA was fluctuating around the $1.90 mark in early April.
However, it was unable to maintain this value and soon continued its downward trajectory. This was exacerbated by the unpegging of the AUSD stablecoin.
Hackers exploited a vulnerability in a new liquidity pool and minted 1.2bn AUSD tokens on 14 August. The stablecoin dropped to its all-time low of $0.009 the following day.
Acala managed to freeze the funds, obtain most of the lost tokens and burn the “erroneously minted AUSD”. But the stablecoin is yet to return to its $1 peg.
A community governance referendum has been proposed and passed. At block 1652829 in approx. 35 minutes, 1,292,860,248 total erroneously minted aUSD will be returned to the honzon protocol and will be burned.
Details in thread below:
— Acala (@AcalaNetwork) August 16, 2022
ACA similarly suffered from the depegging. It stooped to its all-time low of $0.17 on 7 September.
It has recovered slightly since then and was trading at $0.23 on 14 September, up 28% over the past seven days.
Acala token price prediction round-up
At the time of writing, Coin Codex’s ACA price prediction said there was a bearish sentiment. Its fear and greed index displayed fear with 14 technical indicators signalling “sell” and nine bullish signals.
Its short-term acala token price prediction for 2022 suggested it would have dropped by 13% to $0.20 on 13 October.
Meanwhile, DigitalCoinPrice anticipated steady gains for ACA with an average price of $0.32 expected for this year. Its acala token price prediction for 2025 averaged out at $0.99. The cryptocurrency was thought to hit $3.32 in 2030.
Similarly, Price Prediction said it would have reached $0.38 this year. It suggested larger gains were possible. Its acala token price prediction for 2030 gave a maximum price of $8.19.
The ACA crypto price prediction from TechNewsLeader also had high expectations. It suggested a maximum price of $0.66 in a year and $1.96 in five years’ time. The site’s ACA coin price prediction for 2030 said it could have reached $8.56.
When considering a ACA price prediction, it’s important to keep in mind that cryptocurrency markets remain extremely volatile, making it difficult to accurately predict what a coin or token’s price will be in a few hours, and even harder to give long-term estimates. As such, analysts and algorithm-based forecasters can and do get their predictions wrong.
If you are considering investing in cryptocurrency tokens, we recommend that you always do your own research. Look at the latest market trends, news, technical and fundamental analysis, and expert opinion before making any investment decision. Keep in mind that past performance is no guarantee of future returns. And never trade with money that you cannot afford to lose.
Is acala token a good investment?
Acala is a DeFi ecosystem hoping to become an economic hub on the Polkadot blockchain. However, it suffered an exploit in August 2022 that saw its stablecoin unpeg and its utility ACA token plummet.
In volatile cryptocurrency markets, it is important to do your own research on a coin or token to determine if it is a good fit for your investment portfolio. Whether the ACA token is a suitable investment for you depends on your risk tolerance and how much you intend to invest, among other factors. Keep in mind that past performance is no guarantee of future returns. And never invest money that you cannot afford to lose.
Will acala token go up or down?
At the time of writing, forecasters are conflicted. Coin Codex suggested it would have fallen by 13% this month, whereas TechNewsLeader said it could have eventually climbed above $8.
In volatile cryptocurrency markets, it is important to do your own research on a coin or token to determine if it is a good fit for your investment portfolio. Whether acala is a suitable investment for you depends on your risk tolerance and how much you intend to invest, among other factors. Keep in mind that past performance is no guarantee of future returns. And never invest money that you cannot afford to lose.
Should I invest in acala token?
As of 14 September, Acala has lost 92% of its value since it launched on 25 January 2022.
Whether you should invest in ACA is a question that you will have to answer for yourself. Before you do so, however, you will need to conduct your own research and never invest more money than you can afford to lose because prices can go down as well as up.