Ethereum currently boasts the title of most popular smart contract platform out there, but that could soon change. One of the so-called “Ethereum killers” looking to establish itself as a smart contract technology leader is Cardano (ADA). This blockchain project was first developed in 2015 by the Input Output Hong Kong (IOHK) group.
The Charles Hoskinson-led project has some pretty exciting upgrades lined up on its roadmap, including plans to integrate quantum-resistant addresses, on-chain voting, and off-chain payments.
ADA, which is described as a 3rd generation platform, plans to improve on the areas where the 2nd generation ETH blockchain failed. This article discusses the latest developments in Cardano to find how the project could expose all current Ethereum blockchain vulnerabilities.
Goguen: The Third Era Introducing Smart Contracts
The Cardano project is set to implement smart contracts and enable decentralized applications (Dapps) on the network in the third quarter of 2020.The imminent Goguen era that marks the next period after Shelley will build a versatile worldwide social and financial network enabling developers to build Cardano applications.
Dev teams will have the ability to build solutions around app domains for multiple sectors, including property registration, supply chain, identity, and medical records management. Cardano’s product manager Nebojsa Vojvodic explained during a July Cardano Virtual Summit that Goguen is primarily a service platform.
Therefore, the focus of the next chapter in Cardano’s development is on user experience and the utility of building a user-friendly application.The new ADA tools will likely make Cardano a more viable alternative for ETH for developers and enterprises looking to create smart contracts and Dapps.
Moreover, the new Cardano era introduces a simple programming language tailored for folks who don’t have a programming background. Dubbed “Marlowe”, the language is designed to be simple and intuitive, allowing people with no technical background to build smart contracts. This will further push ADA closer to toppling Ethereum’s monopoly as the best existing platform for smart contracts or DApps.
Goguen to make Cardano a Multi-asset Ledger
In addition to smart contract functionalities, Goguen will also offer a Multi-asset Ledger. This feature allows Cardano users to transfer their custom tokens on the network. Unlike Ethereum that prioritizes ETH over other ERC-20 tokens, Cardano will not prioritize ADA transactions.
This unique feature could give Cardano a leg up over the more established ETH network; essentially, developers will soon be able to use Cardano at ease, as all tokens on the network will inherit the top-notch security and smart contract characteristics of the platform’s native ADA token.
Goguen will also provide the ability to create a token similar to the ERC-20 method. Whether a developer wants to create security tokens, utility tokens, collectables, loyalty tokens, or crowdfunding, the new update will provide this ability to the open public.
To demonstrate Cardano’s unique multi-asset standard, the project’ CEO Charles Hoskinson had earlier revealed that he would issue a token for presidential candidate Kanye West on the network.
Giving ADA Developers a Leg up in Financial DApps
In a recent video regarding Cardano’s transformation into the Goguen era, the Cardano CEO reiterated that the Marlowe Project is one of his blockchain’s major developments. He explained that the project would optimize Cardano for the DeFi industry by enabling peer-to-peer loans and contracts for difference (CFDs).
This milestone brings Cardano closer to challenging Ethereum as the default platform for DeFi. Marlowe offers a new entry point for millions of people and startups to build a Domain Specific Language (DSL). Even developers with limited technical backgrounds will easily launch ready-made templates of DeFi contracts and transfer the terms of the contracts on the ADA network.
More so, the Cardano team realizes that access to immutable data is crucial, especially with the increase in financial cryptocurrency operations as the DeFi sector grows.Cardano’s blockchain will thus enable more accountability and transparency of the financial processes by adding transaction metadata.
Metadata will help generate trust with permanent data attestation and enable the maintenance of permanent records on the ADA blockchain. As a third-generation blockchain, Cardano’s transaction size is approximately 16KB, which is substantially higher than 2nd generation blockchains such as ETH that support 40 to 80 bytes of metadata.
Therefore, Cardano’s metadata can carry further information, including sender and receiver details, conditions, and processing time. The most prominent use case for metadata is in a supply chain, where it can grant transparency, immutability, and trust for all stakeholders.
ETH and Cardano Battle to Offer The Best Scalability and Security
The ultimate goal for the ADA network is to offer near-instant and free transactions. This functionality will permit all users to send and receive funds between blockchains and also to legacy systems of the banking world (SWIFT, etc.)
Once the Cardano product is fully functional, it is expected to scale to unlimited transactions. Cardano has achieved scalability of 200-250 transactions per second (tps) in testing, a rate that is way more superior to Ethereum’s current 25 tps.
That said, ETH is also working to improve scaling by transitioning into a PoS consensus mechanism and introducing two upgrades called Sharding and Plasma. These updates will allow faster, cheaper, and more scalable transactions on ETH, ensuring the project doesn’t lag behind newer third-generation blockchains.
Nevertheless, the Ouroboros model that Cardano uses is still superior because, unlike other PoS networks, there is no minimum amount that you have to stake. In terms of security, Cardano is currently ahead of its rival due to its Plutus central programming language that drives functionalities on the network. Plutus is based on the highly secure Haskell language that is currently deployed by most top banking institutions to power their applications.
To avoid the current security vulnerabilities on the Ethereum network, ADA uses a virtual machine language. This functionality offers an alternative to Ethereum’s Solidity smart contract writing, which is prone to numerous exploit vulnerabilities.
Being a newer network, Cardano has the advantage of learning from ETH’s “mistakes,” especially in terms of basic architecture. Charles Hoskinson, who was one of the co-founders of Ethereum, knows that for his project to succeed, he will have to factor in the long-term evolution of ADA.
His dev team is thus focusing on scalability, extensibility, and governance when making architectural decisions. Even as Cardano develops what is seen by many as the most advanced smart contract protocol in the industry, Ethereum is also working to solve its governance, consensus, and scalability issues.
Indeed, the rollout of ETH 2.0 scheduled for completion in 2022 will transition Ethereum into a Proof-of-Stake protocol, similar to Cardano. For Ethereum to maintain its status as the go-to platform for DeFi and smart contract development, its scheduled PoS, Plasma, and Sharding upgrades must succeed.
Failure by the ETH team to fix current vulnerabilities could open the door for other platforms, such as Cardano, to offer a more secure, functional and scalable alternative.