Cardano (ADA), one of the leading smart contract platforms in the crypto space, has been showing strong momentum in the past few weeks. The native token of the network, ADA, has surged by over 50% in the past month, reaching a new all-time high of $0.75 on December 8, 2023. The impressive performance of ADA has been driven by several factors, including:
- The successful launch of the Alonzo hard fork, which enabled smart contract functionality on the Cardano network.
- The growing adoption of decentralized applications (DApps) and decentralized finance (DeFi) protocols on Cardano, such as jpg.store NFT marketplace, Minswap DEX, Liqwid Finance, and Muesliswap.
- The increasing interest and investment from institutional players and whales in Cardano, as evidenced by the rising number of large transactions and addresses on the network.
- The positive outlook and sentiment from the crypto community and analysts, who believe that Cardano has a strong potential to become a global leader in web3 innovation.
However, not everyone is convinced that Cardano’s rally will continue. Some analysts have warned that a rise in ADA price could signal an impending bear market for cryptocurrencies in general. They argue that some peripheral tokens like ADA and Polkadot’s DOT tend to jump into the bull market wave late, and as such, a surge in their market prices usually indicates that a bear market is coming to an end.
What is Cardano?
Cardano is a third-generation blockchain platform that aims to provide a more scalable, secure, and sustainable alternative to existing solutions. Unlike Bitcoin and Ethereum, which are based on proof-of-work (PoW) consensus mechanisms that consume a lot of energy and are prone to centralization and censorship risks, Cardano is based on proof-of-stake (PoS) consensus mechanism that consumes much less energy and is more decentralized and democratic.
Cardano was founded by Charles Hoskinson, one of the co-founders of Ethereum, who left Ethereum after a dispute with Vitalik Buterin over its direction. Hoskinson envisioned Cardano as a platform that can support not only smart contracts but also social impact projects that can benefit humanity.
Cardano’s development roadmap consists of four phases: Byron (2017), Shelley (2019), Goguen (2020), and Basho (2021). Each phase introduces new features and functionalities to improve the network’s performance and usability. The current phase is Basho, which focuses on improving scalability through sharding technology.
How does Cardano’s smart contract feature work?
One of the most anticipated features of Cardano is its smart contract functionality. Smart contracts are self-executing agreements that can facilitate various transactions without intermediaries or trust issues. They can be used for various purposes such as tokenization of assets, governance mechanisms, decentralized applications (DApps), decentralized finance (DeFi), non-fungible tokens (NFTs), gaming platforms, identity management systems, supply chain tracking systems, voting systems, social media platforms, healthcare systems,
and more.
Cardano’s smart contract feature was introduced with the Alonzo hard fork in September 2023. Alonzo enabled developers to write smart contracts using Plutus V2 Script language on Cardano’s network. Plutus V2 Script is an improved version of Plutus V1 Script language that supports more complex logic operations such as arithmetic operations,
logical operations,
control structures,
and user-defined functions.
Plutus V2 Script also supports interoperability with other blockchains through bridges such as Wormhole Bridge,
which connects Ethereum with Polkadot.
What are some examples of DApps built on Cardano?
Since its launch,
Cardano has attracted many developers who have built various DApps using its smart contract feature. Some examples are:
- jpg.store: A NFT marketplace where users can create,
sell,
and buy digital artworks using JPG format. jpg.store uses Plutus V2 Script language to enable users to mint their own NFTs using their own images or photos.
- Minswap: A decentralized exchange (DEX) where users can swap any ERC-20 tokens without intermediaries or fees. Minswap uses Plutus V2 Script language to enable users to create their own liquidity pools using their own tokens or other tokens from other blockchains.
- Liqwid Finance: A DeFi protocol where users can lend,
borrow,
and earn interest on their crypto assets using stablecoins pegged to fiat currencies or other assets. Liqwid Finance uses Plutus V2 Script language to enable users to create their own lending pools using their own assets or other assets from other blockchains.
- Muesliswap: A DEX where users can swap any ERC-20 tokens without intermediaries or fees. Muesliswap uses Plutus V2 Script language to enable users to create their own liquidity pools using
Finn Wells is a proficient news writer at Crypto Quill, specializing in delivering the latest updates on Bitcoin and altcoins to readers worldwide. With a keen interest in the ever-changing landscape of digital currencies, Finn’s articles provide insightful analysis and up-to-the-minute news on the cryptocurrency market. Known for his meticulous research and commitment to accuracy, Finn brings a fresh perspective to the world of blockchain technology. Stay informed with Finn’s comprehensive coverage of Bitcoin and altcoins, as he continues to illuminate the crypto space with his expertise and dedication at Crypto Quill.