Looking into Cardano: Is The Blockchain Still Active in 2024?

Cardano (ADA) is one of those blockchains that grows quietly until the bull market propels its coin price and market capitalisation higher than most cryptocurrencies.

This has led people to think that the blockchain is inactive, even though the founder himself, Charles Hoskinson, often does Twitter Spaces, Streams, and even joins some popular crypto podcasts to talk about his project.

But sadly, people still think the blockchain is inactive because people think that the transaction volume is always going down with the price of ADA, and the ecosystem is not growing. But is that really the reality of Cardano? Let’s talk about it in this article.

What Is Cardano?

Cardano is a Proof of Stake Blockchain that can be considered as a part of the third generation blockchains along with Solana, Binance Smart Chain, and all the post-Ethereum blockchain operating in the crypto space right now.

The blockchain  was created by Charles Hoskinson, who back then still held a position in Ethereum Blockchain.

He was one of the Co-Founders of Ethereum, along with Gavin Wood, who is the creator of Polkadot, and Vitalik Buterin, who still runs Ethereum.

Charles Hoskinson started developing Cardano in 2015 and launched it in 2017 as an alternative to Ethereum.

He left Ethereum and developed Cardano because he wanted a new blockchain that can run more efficiently, considering back then Ethereum was similar to Bitcoin in terms of its transaction speed and transaction fee, which was slow and high.

Hoskinson wanted to fix this problem by implementing a Proof of Stake mechanism which has now been adopted by Ethereum itself.

Back then Ethereum ran on a Proof of Work consensus mechanism, which made it slower and more expensive than most Proof of Stake Blockchains.

Until this day, there has not been any clear stories on why Hoskinson did not stay at Ethereum and improved it with the idea that is now implemented on Cardano.

But, there are some stories that led people to believe he left because of internal conflict and different ways of thinking that led to the core team, which has now gone their separate ways to Ethereum, Cardano, and Polkadot, not working together anymore.

Cardano also moves similar to Ethereum, in the sense that it wants to be a blockchain that can not only be use for moving money, but als can be used as platforms for smart contract and decentralised application deployment.

Difference is, Cardano is now run by Cardano Foundation which is the Company behind the Cardano Blockchain that is led by Charles Hoskinson.

The consensus mechanism has also changed now to what is called Ouroboros which is an upgraded Proof of Stake consensus mechanism.

With Ouroboros, validators need to stake ADA so they can get a chance to validate transactions and earn rewards.

Although they do not implement a Delegated Proof of Stake mechanism, nowadays, ADA holders, who are the holders of the Cardano Blockchain utility coin, can stake their coin on a platform which will then be transferred to validators as their capital for validator staking purposes, essentially mimicking the Delegated Proof of Stake system.

Through Ouroboros, validators are picked randomly by the blockchain system to get a chance to validate. The blockchain will pick a certain pool of validators, not individual ones, so every validator is grouped into pools where each pool shares their rewards.

In this consensus mechanism, validators are selected based on the amount of staked ADA they have in their pool. The higher the amount of staked ADA in their pool the higher the chance they will get picked more often to validate transactions and create blocks.

This mechanism is still considered old, because it mimics what Bitcoin is doing. Difference is, with Bitcoin, the higher the computational power of the mining rig, the higher chance they will be picked to be validators.

With Cardano, the higher their staked ADA is, the higher chance they will be picked to be validators. Both require high capital which makes it unfair and not fully decentralised in the sense of its consensus mechanism.

But, through this mechanism ADA has managed to reach an average transaction fee of $0.1 per transaction, which is currently lower than older generation blockchains.

The current speed of the Cardano Blockchain  is currently standing at around 250 transactions per second, with its highest capacity reaching 1,000 transactions per second.

Even though it is currently low compared to other newer blockchains, it still stands in the sweet spot of a blockchain being fast and safe at the same time.  This is because blockchain with high transaction speed usually sacrifices their safety, and it also goes the other way around.

When a blockchain wants to be safe and fast, they usually are not decentralised, hence sacrificing the true value of crypto. This is called the blockchain trilemma which is a case of trade-offs between scalability (fast and cheap), security, and decentralisation.

How is The Blockchain Doing in 2024?

Most people have misconceptions around Cardano and ADA, as most seem to think that the blockchain and the coin has no more potential left.

Well they might be wrong, because just like any other crypto, ADA has seen a significant drop since in the bear market, but has been significantly rising since the end of 2023, just like other cryptocurrencies.

Its blockchain, just like any other chains, has also been busy with more improvement to fix its weak point, such as its scalability and decentralisation issues.

One of the problem that have been talked about in previous paragraphs is the weak decentralisation system that can be seen from its consensus mechanism and how Cardano Foundation is still in-charge of most upgrades and not much input from the community.

Well, to fix this problem, they are introducing a new Cardano Improvement Proposal or CIP which is the CIP-1694. This CIP plans to increase decentralisation on the whole Cardano  ecosystem.

Some of the plans include transferring Cardano to ADA holders to govern, leaving Cardano Foundation with little to no control over it and increasing onchain governance process for Cardano development.

The process will be done gradually as Cardano Foundation won’t hand over everything all of a sudden to ADA holders.

This is because Cardano Foundation has some projects going on, mostly in the social finance aspect.

Some of the project includes giving lessons to increase blockchain adoption in Brazil, working with UNHCR to help displaced people or refugees, and numerous social projects in Africa to bring financial access and real world basic needs through various initiatives.

These projects need someone to control it, which is why Cardano Foundation has not let everything go to the community, because if they have no control, then they risk stopping all of these projects.

Aside from that, Cardano with Emurgo plans to release some things in 2024. There are currently seven things in mind that are planned to be rolled out in 2024.

The first one is the Chang Hard Fork, which is a hard fork or a full blockchain upgrade to change how the network is governed.

It is said that Chang Hard Fork will bring a new consensus mechanism to make Cardano more decentralised while also increasing its efficiency, meaning making it faster and cheaper while still safe.

The main focus of this chain is still decentralisation, so don’t expect the blockchain to have a speed of 100,000 transactions per second anytime soon, since it’s still on its way to even reach 5,000 transactions per second on average.

The second plan is to introduce the plan to increase decentralisation to the community by doing workshops in various countries so that Cardano Foundation can leave Cardano in the good hands of devoted community members and ADA holders.

Tokenisation is also another aspect in mind that Cardano is trying to increase, where they plan to have more tokenised real world assets on their blockchain, essentially keeping up with the trend.

With this in mind, they also want to increase the number of third party DApps or decentralised applications on their system, so that people can have a better time with easier access when using the Cardano Blockchain.

Through collaborations of third party DApps, not only do they want to increase the number of real world assets on their chain, they also want to increase assets from other chains as well, increasing interoperability with other blockchains.

This is a huge step considering Cardano is considered to be one of the more secluded blockchain that don’t really collaborate with other blockchains.

With this in mind, things might change in terms of adoption, since more people can come into the ecosystem, thanks to the interoperability aspect of the network.

Yoroi wallet, which is Cardano’s main wallet, will also receive upgrades in terms of accommodating the future plans regarding interoperability.

With upgrades on Yoroi wallet, Cardano users might have a better time on the chain thus increasing transaction volume overtime.

The last thing is they want to increase providing content around education and marketing towards their ecosystem.

This is one of the best plans yet, because through this, more people can know that the blockchain is active, thus eradicating the misconception that Cardano is dead.

ADA Economics

Looking at its roadmap, Cardano does not seem to have any plan to change the token economics of ADA. It still has 45 Billion of maximum supply with no intention of changing it whatsoever.

Considering that ADA is an old coin, the token economics doesn’t really matter because most of the supply has already been circulating in the market.

Instead, a great aspect to look at is the staked amount of ADA. Looking at their blockchain scanner currently around 22.98 Billion ADA are staked, meaning they are locked and cannot be sold.

Those staked ADA represents more than 50% of ADA in the market, meaning limited downside for ADA in the future if more people suddenly became interested in buying it or even staking it.

The ecosystem of the blockchain is active as well,  so even though there might not be as many blockchains compared to other chains, currently there are more than 9,6 Million kinds of tokens on Cardano, including memecoins.

This has managed to keep transactions alive on the Cardano Blockchain reaching total transactions of more than 85 million overall, meaning that the blockchain is not dormant, and all the validators still get their rightful rewards.

Conclusion

So is the blockchain really inactive? Of course not! As you can see by yourselves through this article, Cardano is still active even though adoption rate has been slow, evident by the number of DApps on its ecosystem.

But in 2024, we might see something new from Cardano which in turn can bring its glory days back, especially going into the predicted 2025 bull market.

Overall, if you are looking to buy ADA, it might be a great choice if you are patient since its movement is slower than other more popular cryptocurrencies.

But, if you are in it for the long run, ADA can be a great choice to hold as part of your portfolio, especially if your looking to be more active in the crypto and blockchain space by having a chance to govern the network in the future.

Bear in mind that although it still has potential, ADA is no different than any other crypto, in the sense that it can still  be volatile. In order to use it safely, investors need to manage their risk and allocate their money efficiently towards ADA, so when volatility comes, investors can just keep calm and hodl.