Cardano’s upcoming Alonzo update is pushing ADA price despite a huge delay

189
SHARES
1.5k
VIEWS
ADVERTISEMENT

Related articles


The Cardano Foundation is headed by Charles Hoskinson, the founder of Cardano and co-founder of the Ethereum blockchain. On April 6th, he discussed Cardano’s roadmap for the next four years on his YouTube channel in a video entitled “Some Roadmap Considerations”.

In these deliberations, he mentioned that while the Cardano developers are working on solving the scalability problem and the Cardano approach, they will not turn their attention to this problem until the Alonzo update is complete. The scalability phase of the Cardano roadmap is next after the Goguen update has been completed. This phase is called basho, after the Japanese haiku master of the 17th century.

Cardano (ADA) has developed into one of the top 10 cryptocurrencies in the world in a short time thanks to its market capitalization. It currently ranks seventh with a market capitalization of over $ 41 billion. It accounts for almost 2% of the total cryptocurrency market. According to data from CoinGecko, Cardano hit an all-time high of $ 1.55 on April 14.

The upgrade from Deadalus and Alonzo

On April 1, the foundation published the Deadalus update, which initiated support for native tokens in the Cardano blockchain together with the registration of the Project Catalyst Fund3 voting, thus initiating the countdown for Cardano to a fully decentralized blockchain.

This countdown has now come to fruition. Cointelegraph discussed more about 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 variety of other native tokens provided on the Cardano blockchain.” They went on to talk about Cardano becoming a fully decentralized network and explained the following:

“We are pleased to announce that the countdown D = 0, which signaled the complete decentralization of the Cardano blockchain, was also included in the latest implementation of Daedalus. This is a significant milestone when all of Cardano’s equity pools will be operated by community-run equity pool operators. “

On its official website, Cardano claims that this decentralization event is making it one of the most decentralized blockchains in the world. The next and final phase of Goguen in Cardano’s roadmap is the previously delayed Alonzo update. The upgrade brings intelligent contract functions to the blockchain. The development of this upgrade is made possible by the Plutus platform, which offers users of the Cardano blockchain a native intelligent contract language, as mentioned in an IOHK blog about Plutus.

Before the Deadalus update, Cardano went through its Mary hard fork introducing tokens into Cardano’s unspent transaction output set, which processes custom tokens and non-fungible tokens from miners with the same cost-effectiveness as the blockchain network’s native coin ADA can be.

In addition, Cardano developers have even found a way to mint and sell NFT collectibles without smart contract functionality. Cointelegraph discussed with Johannes Jensen, product and project manager of eToroX – a platform for digital assets. He said:

“Alonzo’s hard fork leads to a more complex coordination problem, as the surrounding ecosystem of service providers has to prepare for the hard fork and the subsequent tokens and smart contracts based on Cardano as a whole.”

ADA could soon hit $ 2 due to DeFi growth

Cardano’s ADA has grown nearly 10% in the past 14 days. Given that the significant $ 2 mark at the current growth rate is $ 0.6 off the current retail price, it is highly unlikely that ADA will cross the $ 2 mark in the near future.

Another possible DeFi summer, however, is one of the main reasons that could drive growth. If we use DeFi Summer 2020 as a measure for this year, DeFi markets are likely to grow to new highs in 2021. In fact, the one-year gains for ADA are currently 3,490.8%.

According to data from DappRadar, the total value set in decentralized financial protocols hit its all-time high of $ 70.43 billion on April 16. Since the beginning of this year, the TVL has grown nearly four times at the time of writing. The TVL rose from $ 30.74 billion on January 20 to its current $ 64.47 billion on April 19.

This period has seen immense growth for this subsector of the cryptocurrency market. On this subject, Jensen continued: “There is no doubt that the final stages of the Goguen phase on Cardano will bring a variety of existing DeFi trends into the network, such as: B. automated market makers and credit markets. “

However, most of the DeFi protocols currently in existence are based on the Ethereum blockchain. Ethereum has also involved the development teams of top DeFi protocols like Uniswap, Yearn.finance and others. Although even Cardano continues to assess its reach in the DeFi markets positively, the representative of the foundation said: “We are certain that with the availability of more of our components, a large number of DeFi solutions and indeed all types of DApps will be built and in the Cardano blockchain migrated. “

Connected: Life Beyond Ethereum: Which First Layer Blockchains Bring DeFi

With its use cases and the in-depth Alonzo update that offers smart contract features, Cardano is well positioned to become a DeFi alternative platform to Ethereum. The adoption of decentralized applications and DeFi protocols will also affect the price of ADA.

In addition to expanding its presence in DeFi markets, Cardano is also striving to improve blockchain adoption in markets such as South America, Africa, and Southeast Asia. The platform intends to offer the blockchain capability for various use cases such as logistics, procurement agriculture and trade. Cardano is partnering with Emurgo, an emerging market consultancy, to achieve this goal. Here Jensen said:

“If they can convince leading companies in Africa, South America and Southeast Asia to use the Cardano blockchain, the scale will shift from Ethereum-based DeFi applications to global trade and trade processing applications.”

Cardano already has supply chain use cases. With the Cardano Scantrust solution, companies can use different blockchain functions to support different aspects of their business. In addition to supporting business solutions, the Cardano blockchain is being adopted by new domains.

Recently, AgeUSD, the first Cardano-based stablecoin, was announced, an algorithmic stablecoin protocol that was developed in collaboration with Emurgo and Input-Output Global for the Ergo blockchain. 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 almost since Ethereum was in the spotlight. Little has developed in this regard as Ethereum continues to be king of the DeFi ecosystem. However, Cardano approaches this entire narrative very positively. His representative explains:

“We are less interested in competing for market share than in delivering first-class components for the decentralized future. […] We’d rather focus on interoperability and collaboration with other blockchains, as we feel that decentralized technology is too important to fail. We work for the good of the entire blockchain industry and the introduction of blockchain technology as a whole. “