Cardano will strive to become an Ethereum contender if Alonzo’s next update lives up to the game-changing expectations.
The Cardano Foundation is led by Charles Hoskinson, the founder of Cardano and also a co-founder of the Ethereum blockchain. On April 6, through his YouTube channel, he spoke about Cardano’s roadmap covering the next four years in a video titled “Some thoughts on the roadmap.”
In these reflections, he mentioned that while the Cardano developers are working on solving the scalability issue and Cardano’s approach to it, he will only turn his attention to this issue once the Alonzo update is complete. The scalability phase of the Cardano roadmap is coming up next, following the completion of the Goguen update. This phase is called Basho, in honor of the seventeenth century Japanese haiku master.
Cardano (ADA) has become one of the top 10 cryptocurrencies in the world by market capitalization in a short period of time. It currently ranks seventh, with a market capitalization of more than $ 41 billion. It represents almost 2% of the entire cryptocurrency market. According to data from CoinGecko, Cardano hit an all-time high of $ 1.55 on April 14.
The Deadalus and Alonzo update
On April 1, the foundation released the Deadalus update, which ushered in support for native tokens on the Cardano blockchain, along with the Catalyst Fund3 Project voting record, effectively starting the countdown for Cardano to convert. on a completely decentralized blockchain.
Since then, this countdown has come to an end. Cointelegraph further discussed the Deadalus update with a representative from the Cardano Foundation. They stated: “Daedalus users can now use their wallet as a single unified interface to receive both ADA and a host of other native tokens implemented on the Cardano blockchain.” Additionally, they talked about Cardano becoming a fully decentralized network, and detailed:
“We are delighted to report that the countdown D = 0, which signaled the full decentralization of the Cardano blockchain, has also been included in the latest Daedalus implementation. This marks a momentous milestone where all of Cardano’s stakeholders are operated by community-led stakeholder operators. “
On its official website, Cardano claims that this decentralization event makes it one of the most decentralized blockchains in the world. Goguen’s next and final phase on the Cardano roadmap is the Alonzo update that was previously delayed. The update will bring smart contract functionality to the blockchain. The development of this update is enabled by the Plutus platform, which brings a native smart contract language to users of the Cardano blockchain as mentioned in an IOHK blog about Plutus.
Prior to the Deadalus upgrade, Cardano went through its fork Mary, which introduced tokens into Cardano’s unspent transaction output pool that allows miners to process custom tokens and non-fungible tokens with the same profitability as the native coin of the blockchain network, ADA. .
Furthermore, Cardano developers have even found a way to mint and sell NFT collectibles without the smart contract functionality. Cointelegraph spoke with Johannes Jensen, product and project manager at eToroX, a digital asset platform. He said:
“The Alonzo hard fork introduces a more complex coordination problem, as the surrounding ecosystem of service providers will have to fully prepare for the hard fork and subsequent Cardano-based smart contracts and tokens.”
ADA Could Hit $ 2 Soon Due To DeFi Growth
Cardano’s ADA has seen gains of almost 10% in the last 14 days. Considering that the significant $ 2 mark is $ 0.6 from the current trading price, at the current growth rate, it is highly unlikely that ADA will break the $ 2 mark in the near future.
Yet another possible “DeFi summer” is one of the main reasons that could drive growth. If we use the DeFi summer of 2020 as an indicator for this year, the DeFi markets will likely grow to new highs in 2021. In fact, the one-year gains for ADA currently stand at 3,490.8%.
According to data from DappRadar, the total value locked up in decentralized financial protocols reached its all-time high of $ 70.43 billion on April 16. Since the beginning of this year, the TVL has grown almost fourfold, as of this writing. The TVL went from $ 30.74 billion on January 20 to $ 64.47 billion on April 19.
This period has marked immense growth for this subsector of the cryptocurrency market. On this, Jensen further opined: “There is no doubt that the final stages of the Goguen phase at Cardano will introduce a number of existing trends in DeFi to the network, such as automated market makers and the loan market.”
However, most of the DeFi protocols that currently exist are based on the Ethereum blockchain. Ethereum has also onboarding development teams for major DeFi protocols like Uniswap, Yearn.finance, and others. While even Cardano remains positive about its reach in the DeFi markets, the foundation representative said: “We are confident that as more of our components become available, we will see a multitude of DeFi solutions and indeed all kinds of Built DApps. and migrated to the Cardano blockchain. “
Related: The Life Beyond Ethereum: What Layer One Blockchains Are Bringing To DeFi
With its use cases and the incoming Alonzo update bringing smart contract functionality, Cardano is well positioned to become an alternative platform from DeFi to Ethereum. The adoption between decentralized applications and DeFi protocols will also affect the price of ADA.
In addition to expanding its presence in the DeFi markets, Cardano is making efforts to improve blockchain adoption in markets such as South America, Africa, and Southeast Asia. The platform intends to offer blockchain capabilities to a number of different use cases, such as logistics, procurement agriculture, and commerce. Cardano is working with Emurgo, an emerging markets consultancy, to achieve this goal. Here, Jensen said:
“If they succeed in convincing leaders in Africa, South America and Southeast Asia to use the Cardano blockchain, the criteria will shift from Ethereum-based DeFi applications to global trading and business processing applications.”
Cardano already has use cases in the supply chain domain. The Cardano-Scantrust solution enables companies to use various blockchain functions to assist in multiple aspects of their business. In addition to helping business solutions, the Cardano blockchain is being embraced by new domains.
Recently, the first Cardano-based stablecoin, AgeUSD, was announced which is an algorithmic stablecoin protocol that was developed on the Ergo blockchain in collaboration with Emurgo and Input-Output Global. This stablecoin will be available on Cardano along with the Alonzo smart contract update.
With Ethereum’s gas fees soaring, the “Ethereum killer” narrative has been in the cryptocurrency market for almost since Ethereum gained attention. There has been little development on this as Ethereum remains the king of the DeFi ecosystem. However, Cardano takes a very positive approach to this entire narrative, and its representative states:
“We are less interested in competing for market share and more interested in offering the best components for the decentralized future. […] We would rather focus on interoperability and cooperation with other blockchains, as we believe decentralized technology is too important to fail. We work for the good of the entire blockchain industry and the adoption of blockchain technology as a whole. “