Cardano is considered one of the most popular blockchain projects and experienced massive hype again in the last bull market. Cardano’s ADA token was able to rise to a price of $3. But the bear market has hit Cardano hard. With the Layer 2 solution Hydra, the breakthrough in scalability is now to come. Can the project take the next big step or do we see standstill?
Where does Cardano development stand in 2023?
For several years, Cardano has been considered a project with an extremely enthusiastic fan base. That’s because Charles Hoskinson, the mind behind Cardano, branded the project as scientific and long-term oriented. The long-term approach is reflected in the various development phases :
- Byron : Byron laid the foundation for the mainnet and the ADA wallet was developed.
- Shelley : Community-driven nodes were included in this phase, so Cardano became increasingly decentralized.
- Goguen : The network developed smart contract functions, which improved broad applicability.
- Basho : Cardano is currently in the basho development phase. Layer 2 solutions are intended to optimize the scalability of the network.
- Voltaire : According to the roadmap , the last phase should start this year. At Voltaire, the developers want to establish decentralized governance. The holders of ADA tokens can vote on the future of the project in the future.
Cardano is currently working on increasing scalability. The most important technical innovation in the Basho development phase is the layer 2 solution Hydra.
What is Hydra?
Hydra is a Layer 2 solution for the Cardano blockchain. This should massively increase the scalability of the blockchain. Cardano’s scalability is still an area where it lags behind blockchain like Solana and Avalanche.
Theoretically, a transaction speed of 100,000 transactions per second should be possible after the end of the basho development phase. This would be twice as high as the theoretical transaction speed at Solana. We have to mention that the practical speed with Solana is lower and network failures are not uncommon.
Where does the Cardano project stand in 2023?
With Goguen, Cardano wanted to catch up with projects like Ethereum and steadily grow in the number of decentralized applications using the network. However, the network was far from being able to catch up with other networks. The “Total Locked Value” at Cardano is currently 139 million US dollars. In the Ethereum mainnet it is 29 billion US dollars. Even Ethereum’s Layer 2 solutions like Arbitrum ($3.1M) and Optimism ($1M) are more.
This means that in 2023 Cardano will still be a long way from reaching Ethereum in terms of network effects. What’s still driving the network at the moment is the prospect of a more “efficient” Ethereum in the future. That’s why the Basho and Voltaire developments are so important right now.
Is the Cardano breakthrough coming or are we seeing a standstill?
In the 2021 bull market, the Cardano hype was huge , which caused the ADA price to rise above $3. Accordingly, the bear market disillusionment came quickly and the ADA dropped to $0.25.
In order to reach new all-time highs again in the next bull market, Cardano needs strong further development with visible results. If the scalability is significantly improved, one could actually establish an advantage over Ethereum, so that the gap in the number of applications decreases again. If this succeeds, the ADA token can explode again in the next bull market.
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