If the forthcoming Alonzo update lives up to the hype of becoming a game-changer, Cardano will try to compete with Ethereum.
In a short period of time, Cardano (ADA) has risen to become one of the top ten cryptocurrencies in the world by market capitalization.
With a market capitalization of over $41 billion, it is currently ranked seventh. It is responsible for nearly 2% of the entire cryptocurrency sector.
Cardano reached an all-time high of $1.56 on April 14, according to CoinGecko numbers.
The IOHK is led by Charles Hoskinson, the founder of Cardano and also the co-founder of the Ethereum blockchain.
On April 6, through his YouTube channel, he discussed Cardano’s roadmap covering the next four years in a video titled “Some Musings about the Roadmap.”
He stated in these musings that, while the Cardano developers are working on resolving the scalability problem and Cardano’s solution to it, he would only focus on it once the Alonzo update is complete.
Following the completion of the Goguen update, the Cardano roadmap will move on to the scalability process.
This phase is named Basho, after the 17th-century Japanese haiku master.
The Deadalus and Alonzo upgrade
On April 1, Cardano released the Deadalus update, which allowed native token support on the Cardano blockchain as well as Project Catalyst Fund3 voting registration, effectively kicking off the countdown to Cardano becoming a fully decentralized blockchain.
This countdown has now come to a conclusion.
A representative of the Cardano Foundation spoke about the Deadalus update in greater detail.
“Daedalus users can now use their wallet as a centralized gateway to receive both ADA and a host of other native tokens deployed on the Cardano blockchain,” they wrote.
They also discussed Cardano being a fully decentralized network.
Cardano states on its official website that this decentralization case renders it one of the world’s most decentralized blockchains.
The previously postponed Alonzo update is the next and final step of Goguen on Cardano’s roadmap.
Smart contract features will be added to the blockchain as a result of the update.
The Plutus platform, as described in an IOHK blog about Plutus, enables the development of this upgrade by providing users of the Cardano blockchain with a native smart contract language.
ADA could reach $2 soon due to DeFi growth
Cardano’s ADA has seen nearly 10% gains in the last 14 days.
Considering that the significant $2 mark is $0.6 away from the current trading price, at the current rate of growth, it is highly unlikely that ADA will surpass the $2 mark in the near future.
However, another possible “DeFi summer” is one of the main reasons that could drive the growth.
If we use the DeFi summer of 2020 as a gauge for this year, the DeFi markets will probably grow to new highs in 2021. In fact, the one-year gains for ADA currently stand at 3,490.8%.
According to data from DappRadar, the total value locked in decentralized finance protocols reached its all-time high of $70.43 billion on April 16.
Since the beginning of this year, the TVL has grown nearly four times, at the time of writing.
The TVL went from $30.74 billion on Jan. 20 to currently standing at $64.47 billion as of April 19.
However, most DeFi protocols currently in existence are built on the Ethereum blockchain.
Ethereum has also onboarded the development teams of top DeFi protocols such as Uniswap, Yearn.finance and others.
Although even Cardano remains to be positive about their scope in the DeFi markets, the representative from the foundation said: “We are sure that as more of our components become available, we will see a multitude of DeFi solutions and indeed all manner of DApps built and migrated to the Cardano blockchain.”
Cardano already has use cases in the supply chain domain.
The Cardano-Scantrust solution lets businesses use various blockchain functions to aid multiple aspects of their business.
Along with aiding business solutions, the Cardano blockchain is seeing adoption from new domains.
Recently, the first Cardano-based stablecoin was announced, AgeUSD, which is an algorithmic stablecoin protocol that was developed on the Ergo blockchain in collaboration with Emurgo and Input-Output Global.
This stablecoin will be available on Cardano along with the Alonzo smart contract update.
With Ethereum’s rising gas fees, the “Ethereum killer” narrative has been in the cryptocurrency market almost since Ethereum gained the spotlight.
There has been little development on this as Ethereum continues to be king of the DeFi ecosystem.