What does Cardano challenge Ethereum?

In July of this year, Cardano ( ADA ) suddenly rose from $1.064 to $2.89, setting a record high and becoming the third largest cryptocurrency by market capitalization.

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Why did Cardano, which had almost “disappeared”, suddenly emerged? When Ethernet Square when everywhere on the application, DeFi / NFT long into the ecology, Cardano exactly what means challenges Ethernet Square ?

Very interesting two months: price turnaround

On March 13, 2020, ADA dropped to a minimum of 0.019 USD; on May 16, 2021, ADA rose to a maximum of 2.45 USD. In more than a year, the highest increase was more than 127 times.

After experiencing 519, ADA once again ushered in a comeback. From $1.064 to $2.89, breaking the previous high to a record high, ADA only took one month.

According to CoinMarketcap data, ADA has a supply of 45 billion pieces, and currently nearly 321.3 pieces are in circulation, ranking third in the cryptocurrency list with a market value of $87.5 billion. In addition, among the top ten cryptocurrencies by pledge value , ADA ranked first with a pledge value of US$68,436,488,727. According to the Staking Rewards website, Cardano is currently the world’s largest PoS blockchain network with a pledge rate of 69.8%.

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If you analyze the reasons for the rise of ADA from the news, the main benefits are the upcoming launch of smart contract functions and the continuous increase in data such as the ADA pledge rate.

At the end of January this year, the founder of Cardano tweeted that his smart contracts will be open sourced from March. At the end of February, he said that his mainnet staking pool Charles Pool has begun to operate, and the new economic model codenamed Mary Protocol has also been successfully applied to Cardano. On the main network, a series of good news are released rhythmically, which is undoubtedly a boost to the market.

In mid-August, Tim Harrison, director of marketing and communications for its development team IOHK, announced that Cardano’s goal is to launch the Alonzo hard fork on the mainnet on September 12. The upgrade will allow users to run smart contracts on the PoS blockchain, when NFT and various DeFi use cases will be introduced into the Cardano ecosystem Previously, Cardano, which had been established for six years because of the lack of smart contracts, has not been able to support Dapp and has been criticized. Once the smart contract is fully implemented, it means that Cardano will begin to compete ecologically with the major public chains as a complete public chain.

Cardano founder Charles Hoskinson tweeted that as Cardano is focusing on launching smart contracts, the next two months will be interesting. Opponents of the Cardano award have experienced multiple collapses and became annoyed.

Applications without boundaries

It is worth noting that there are multiple applications on the Cardano chain. In addition to being a payment method and voting tool on the Cardano platform, Cardano can also be used in a variety of fields, including agriculture, education, healthcare, and trade.

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From the Cardano community

From the current NFT track that has attracted much attention, there are more than 40 related projects on the Cardano chain, such as CryptoDoggies, PunksterArt, and NFT-Dao. It also covers IDO platform, DEX, liquidity agreement, wallet, payment, etc. projects.

Since Cardano has not yet fully transitioned to the smart contract stage, most of the current ecological projects are in the early stage. In March this year, Cardano founder Charles Hoskinson emphasized in an interview with Bloomberg that more than 100 companies are already considering migrating from Ethereum when Cardano functions mature.

In addition, it needs to be particularly emphasized that Cardano has a strong market and application in Africa.

What exactly is Cardano going to do?

Having said so much, what exactly is Cardano going to do?

Cardano is a groundbreaking proof-of-stake blockchain network, which is being developed into a decentralized application (DApp) development platform with multi-asset ledgers and verifiable smart contracts. Cardano plans to achieve the scalability, interoperability and support required by practical applications, and become the goal of future economic development.

The Cardano route consists of five periods: Byron, Shelley, Goguen, Basho and Voltaire. Each period is named by a celebrity and revolves around a series of functions that will be provided in multiple code versions.

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  • Byron (British poet Byron): The first layer of the Cardano platform is also the core of the Cardano system, which allows users to send and receive $ADA.
  • Shelley (British romantic poet Shelley): Focus on turning Cardano into a completely decentralized autonomous system, starting with a pool of shares and authorization. 
  • Goguen (American computer scientist Gao Gen): Brings different computing layers to make smart contracts for financial transactions possible. 
  • Basho (Japanese haiku master Matsuo Basho): Focus on performance and scalability.
  • Voltaire (French writer Voltaire): Focus on sustainability and self-sovereign identity.

Another reason why Cardano has attracted attention is that Ethereum’s high gas fees and network congestion caused DeFi projects to seek alternatives.

What does Cardano compete with Ethereum?

In terms of throughput, Ethereum can process 15 transactions per second (TPS) in its current state, although its proposed sharding upgrade is expected to increase the transaction speed to nearly 100,000 TPS. In contrast, Cardano can already support hundreds of transactions per second, and with the development of its Layer 2 Hydra protocol, the throughput of the network may increase to more than 1 million transactions per second.

In terms of smart contract functions, Ethereum has a relatively low tolerance for bugs and errors, and ehreas Cardano’s CCL provides greater flexibility in case the deployed application needs to be changed. In addition, Cardano also allows users to set custom rules for confirming transactions.

However, this situation may change with the migration of Ethereum from POW to POS. However, as networks like Cardano make blockchain interoperability a reality, in the long run, the industry is likely to gain more benefits through cooperation rather than competition.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/what-does-cardano-challenge-ethereum/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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