Big things are happening on the Cardano network in 2022. There are a number of DEX’s (Decentralized Exchanges) that are slated to be released this year. Cardano released their smart contract capability with the Alonzo upgrade on Sept 12th, 2021. There was a lot of controversy in the community when the details of the implementation came out. Some people questioned why it took so long for Cardano to release this capability. Others questioned choosing Plutus (based on Haskell) for the smart contract programming language and the eUTXO transaction model. The arguments were that Cardano was behind the curve by releasing this capability so “late”, that Haskell isn’t a well known programming language, and that the eUTXO model would limit blocks to one transaction, (basically making the network too slow to use). IOHK, the main company behind Cardano, released a statement pushing back against the naysayers.
I don’t think anyone would argue that smart contracts need to be secure and easily verifiable. There have been a number of hacks on other crypto networks where the hacker exploited a smart contract to gain access to funds. (This hack cost users $31 million USD.) Haskell was chosen because it is a functional programming language. Functional languages are a great choice for high-assurance software that needs to be easily verifiable.
eUTXO is an extension of the UTXO model which was originally used by Bitcoin. The eUTXO model makes predicting the cost of executing a smart contract much easier than the Ethereum model. If you used the Ethereum network, you know that there can be a big range of estimated cost for executing a transaction. As a user, knowing the exact transaction cost up front makes the network more appealing. IOHK further explained eUTXO to dispell some of the FUD:
Arguably, the most highly anticipated Cardano DEX is SundaeSwap. SundaeSwap released to the Cardano TestNet on Dec 5th, 2021. The team conducted a mainnet load test on Dec 18th and recently released an update regarding their upcoming mainnet release.
First impressions can be lasting impressions. During their testnet phase, they have been working with IOHK to refine the network protocols. Their Dec 18th mainnet load test revealed some potential network delays and issues. While it’s impossible to predict the exact load SundaeSwap will put on the Cardano network, given the amount of attention the project has garnered, I wouldn’t be suprised if there were some bumps after it’s rolled out. The SundaeSwap team also agrees:
In anticipation of network growth from SundaeSwap and other DEX’s, IOHK has been working on performance related changes. Release 1.33.0 is a performance focused release that was delivered on Jan 7th. They have reduced memory usage (which I did see after updating the 4WARD pool) and brought significant improvements to the sync time and block propogation time. It’s a positive step towards the potential explosion of transactions on the network once SundaeSwap and other DEX’s get released on Cardano’s mainnet.
2022 has the potential to bring massive growth to the Cardano network if they can successfully navigate the deployment of SundaeSwap and the other upcoming DEX’s. If needed, the configurable nature of their network should allow them to move fairly quickly to address any issues that pop up. IOHK has moved slowly through their development process and a lot of people have disagreed with that approach over the years. Generally speaking, it isn’t considered a good “business” move, but it may prove to have been the right decision. What happens during 2022 should answer that question once and for all.