- Cardano’s successful release of the Alonzo hard fork brought smart contracts to the platforms.
- After three years of testing and peer reviews, Cardano has the same functionalities as Ethereum and other smart contract ecosystems.
- Cardano’s smart contract capacities and functionalities have been highly criticized.
Peer-reviewed or first to market? With Cardano implementing its smart contract capabilities on September 12th, Etheruem’s market dominance could diminish. Cardano successfully released the “Plutus smart contract capabilities through a hard-fork update” and created a level assessment field between the existing smart contract ecosystem.
A New Dapps Environment
On Sunday, September 12th, Input-Output HK (IOHK) announced the successful release of the Alonzo hard fork update. The new update will represent the “start of a new era,” as developers are able to deploy smart contracts on the network, stimulating the development of dapps.
In a blog post released by IOHK, the company states that “expectations” need to be managed as an ecosystem of highly sophisticated dapps is a timely task, emphasizing the time it took Ethereum dapps to gain popularity.
The epochal update that incurred three testing phases will enable new network growth possibilities. Now Cardano has unlocked the development of new features such as Decentralized Finance, NFTs, and the oracle network, features previously available on other platforms such as Ethereum or Tron.
Furthermore, Tim Harrison, marketing and communication director at IOHK, illustrated an ecosystem outlook showing the number of new or transitioning projects that want to use Cardano’s smart contract functions.
Rocky Road to Success
Seamless network deployment is a phantasm in the crypto space. However, as Cardano’s testnet entered the final phase, developers and Ethereum maximalists found incongruencies between network expectation and the smart contract service model. Specifically, the EUTXO proposed by Cardano offers a “different programming paradigm” than existing blockchains.
Minswap, the first DEX on Cardano, was forced to shut down network testing, as users discovered Cardano’s smart contracts could not handle more than one transaction per block. Still, EUTXO’s architecture is not a “fundamental flaw” but rather a development challenge.
Still, IOHK released a blog post explaining EUTXO’s system architecture. According to the article, the system underpinning Plutus smart contracts offers greater security, full cost predictability, and the inability to lose transaction fees during failed transactions.
On The Flipside
- Cardano dapps will not be released in the foreseeable future as DEX developers still need to find loopholes for the EUTXO challenge.
- The price of ADA could skyrocket if Cardano smart contract adoption increases.
Sell the News
In anticipation of the Alonzo hard fork, the price of ADA, Cardano’s native tokens, surged to a new all-time high of $3.10, according to data from Coinmarketcap. However, news regarding possible programming issues prevented the parabolic rally, as ADA’s price stagnated.
Following the successful hard fork, ADA lost 10% as investors “sold the news.” Moreover, the market sell-off coupled with project FUD regarding programmability capabilities caused the price of ADA to plunge to a weekly low of $2.27.
Nonetheless, Cardano’s smart contract is not yet proven. However, with a big community backing, which trusts Charles Hoskinson, the network needs to meet harsh industry demands before being considered an Ethereum contender.
Why You Should Care?
Cardano is the third token by market capitalization despite not embedding network features such as DeFi or NFTs, which the industry is highly demanding. A network valuation of $77 billion needs to be argued and accounted for by the product it adds to the market. Thus, the Alonzo upgrade is IOHK’s entry ticket. Still, it is unknown whether Cardano can gain a substantial share of the smart contract space.