Ethereum (ETH-USD) isn’t the only network bringing a big update to users this month. Cardano (ADA-USD) has been preparing its own network overhaul and, while it has less publicity attached to it, the upgrade is an appealing new construction for the network. But what will the Vasil hard fork bring? Will it be a catalyst for the ADA crypto?
Cardano is a layer-1 dapp network, just like Ethereum. It was even founded by an Ethereum cofounder. Charles Hoskinson departed Ethereum in 2014 and went on to create Cardano as a research-based competitor.
In late 2021, the network finally rolled out smart contract capabilities, allowing developers to create dapps native to Cardano. By this point, ADA was already a top 10 crypto by market capitalization. But now, with hundreds of dapps to its name and several updates to improve developer and user experiences, it trails only ETH as the largest layer-1 project in the world.
And while Ethereum is billions upon billions of dollars ahead of Cardano in terms of market cap, the Vasil hard fork should help it to bridge that gap — if only slightly.
The hard fork was set to launch in June 2022 and stirred up a lot of excitement when it was first announced. However, just like Ethereum underwent with the Merge, Cardano’s Vasil rollout saw multiple delays. Earlier this month, it was given a hard release date of Sept. 22. Now, with just hours to go before the Ethereum competitor ups the ante, here’s what investors can expect.
Cardano Hard Fork Upgrade to Streamline Network Performance
Blockchain critics don’t shy away from pointing out Cardano’s flaws. And don’t get it wrong; even for a network its size, Cardano has its fair share of issues. Many are quick to point out that the network takes on accounting measures that are far more dated than its competitors. Its smart contracts are not as robust either, even with its own smart contract platform. But with the Vasil hard fork incoming, that could very well change.
Much of the upgrades included are very technical in nature and do not directly affect the end-user experience of Cardano. However, they do promise to be very handy for developers and should scale up the speed and volume of transactions significantly.
Cardano accounts user funds using the same mechanism as Bitcoin (BTC-USD). While it does the job, it’s a much less high-performance methodology when compared to competitors. The biggest upgrade is in improving this mechanism, called “unspent transaction output” (UTXO). Introducing new inputs through the Vasil hard fork aims to keep the amount of computing needed to check certain data to a minimum.
Other changes to the network seek similar ends by doing things like simplifying data exchanges between users. Another big upgrade on the way is “diffusion pipelining.” Through this mechanic, the blockchain will be capable of processing multiple steps of a transaction at once. This will greatly improve the speed of transactions and help beef up Cardano’s scalability.
Those hoping for a big ADA crypto catalyst may find themselves disappointed, however. The behavior of ETH post-Merge gives a peak into what to expect. While many had expected the upgrade to precede an upward soaring in price, the coin actually saw a $400 price drop. Simply put, macroeconomic conditions are still dictating price trends. With the Federal Reserve threatening to continue rate hikes, crypto prices aren’t going up any time soon.
On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.