Cardano can now mint NFTs, run DApps and more — but the creators themselves are asking people to keep their expectations in check
- Cardano’s Alonzo upgrade introduces smart contracts to the network and makes it more useful.
- The ADA token has become over 100% more valuable over the past month.
- The Alonzo upgrade has made
Cardanothe direct competitor for Ethereum.
AdvertisementTwo days after Bitcoin produced its 700,000th block amidst much fanfare, another important cryptocurrency has announced a milestone. ‘
"The Alonzo upgrade will bring highly anticipated capabilities to Cardano... this is where the mission truly begins… https://t.co/yd6EG1tpoB— Cardano Foundation (@CardanoStiftung) 1631467052000
The update puts Cardano in direct competition with Ethereum, giving it more flexibility in terms of applications like non-fungible tokens ( NFTs), automated lending and more.
Like Ethereum, the Cardano blockchain is also based on the proof-of-stake system, which requires miners to put up their own stake of crypto. Only those with the largest stake will be rewarded for their services. It reduces the overall computing power required for mining on a public blockchain and hence is more environmentally sound.
The third largest cryptocurrency in the world
To be fair, Ethereum still leads Cardano in terms of overall market capitalisation. On September 12, Cardano had a market cap of around $82 billion against Ethereum’s whopping $400 billion market cap.
However, Cardano has risen from being the simple underdog to being among the top five cryptocurrencies in the world in terms of market cap. It is currently placed in third position, behind Bitcoin and Ethereum.
Ethereum’s London Hard Fork
Ethereum’s London Hard Fork rolled out on August 5 and is seen as the first step towards ‘version 2.0’ of the platform, which will arrive next year.
The new system moves the Ethereum blockchain towards the proof-of-stake system like Cardano and reduces not only its environmental footprint but also the transaction fees required on the network. Ether’s price — the cryptocurrency which fuels the Ethereum blockchain — has risen from around $2,700 on August 5 to $3,200 on September 12, whereas Cardano’s price remains around the $2 mark.
“It’s only just the beginning. But this is still a moment for celebration. As a community, we have been on an incredible journey together. Rightly, we should allow ourselves to acknowledge the tremendous efforts made by so many to get here. This will also be a time for reflection on the challenges we've collectively overcome,” wrote Tim Harrison, Marketing and Communications Director of Input Output Global, the creators of Cardano, in a blog post.
Cardano’s recent highs
While Cardano’s price may be a fraction of what Ethereum costs right now, the cryptocurrency has been reaching its own highs. The market cap for ADA, Cardano’s native token, has almost doubled over the past month. On August 31, the token defied crash predictions to rise to an all time high of $2.56 — providing investors with over 150% returns.
As mentioned before, introducing smart contracts makes the Cardano blockchain more flexible and useful, which in turn means it will have more usage. Which is one of the main reasons why many in the blockchain and DeFi world picked Ethereum over Bitcoin in the first place.
Harrison warned that while the expectations from Alonzo are high, some may be unreasonable. “Cardano watchers may be expecting a sophisticated ecosystem of consumer-ready DApps available immediately after the upgrade. Expectations need to be managed here. We should remember that another well-known blockchain project which launched in July 2015 had to wait over two years before its first DApp (something to do with cats?) gained real user traction,” he wrote, referencing Cryptokitties, which was the first DApp built on the Ethereum blockchain.
For a more in-depth discussion, come on over to Business Insider Cryptosphere — a forum where users can deep dive into all things crypto, engage in interesting discussions and stay ahead of the curve.
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