The crypto market is right now at a point when the strength of one network may allow for the success of another.Perhaps the best illustration of this is the competition between Ethereum and Cardano, with the latter undermining the user base of the former.
One of the leading blockchain networks currently gaining from the increased Ethereum petrol prices is Cardano. Investors are apparently shifting to networks like Cardano, which is more cost-effective, in large part because of one important tool in its toolbox. The network is more scalable thanks to Cardano’s hydra upgrade.
As it addresses the scalability issue, Hydra, the layer 2 protocol that was just published on the Cardano blockchain, has increased the ecosystem’s appeal to investors. On the other hand, the Ethereum network has grown more challenging to utilise as its gas charge keeps increasing to unfathomable levels. The petrol fee has reportedly increased to $187, driving investors to go to Cardano ecosystems.
Current estimated petrol costs for a truck on Ethereum are $187.71.
Sebastien Guillemot, CTO and co-founder of DCSpark, explains why Cardano is only 6 percent from reaching its maximum capacity in a lengthy Twitter conversation.
Cardano has a 94% load right now!
The fees earned on the two networks are contrasted here. Over the past several days, Ethereum costs have risen rapidly. Due to the buzz around memecoin, network congestion has been partially attributed to this growth.
meanwhile, Cardano fees were negligible in relation to Ethereum. Cardano fees recently reached a height of just over $13,000 while ETH fees recently reached a peak of $35 million.
Of course, Cardano had a considerably smaller user base than Ethereum did. However, the increase in costs on Ethereum continues to be a significant drawback in terms of fees, which is why Cardano is becoming more popular.
Let’s examine some other factors that support the growing popularity of Cardano. In the past week, its number of daily active addresses has increased, indicating increased network activity. Especially on May 9, when Ethereum petrol prices peaked, its social dominance indicator showed heightened enthusiasm.
Cardano has conducted a number of network improvement measures over the years, notably its February Valentine update. According to reports, this upgrade will increase support for a curve known as SECP256k1.
This is what Bitcoin, Ethereum, and Binance Coin utilize for their public key cryptography, therefore the update makes Cardano and these other top blockchains more compatible. Elliptic Curve Digital Signature Algorithm (ECDSA) and Schnorr are two more forms of signatures that people and businesses building decentralized applications (DApps) on Cardano will be able to utilize to validate data. This is in addition to Edwards-curve Digital Signature Algorithm (EdDSA), Cardano’s original signature algorithm.
It seeks to increase interoperability while also saving developers money and effort and reducing mistakes that could endanger security while writing smart contracts in Plutus.
Transactions created on a sidechain or another blockchain can be easily validated because to the Valentine signature improvements. Cardano’s Hydra additionally provides the platform a benefit over Ethereum because it reduces application handling time and frees up the main chain from doing so. More intriguingly, it lowers expenses, increasing user appeal.
Cardano has also given sustainability a lot of consideration as it works to decentralize the blockchain and prevent it from being dominated by a single business or small group of individuals. In this situation, enabling peer-to-peer (P2P) connectivity makes the network more decentralized as it allows interaction between thousands of machines run by Cardano’s stake pool managers.
The interoperability, scalability, and sustainability of ADA have recently been improved, making it a viable blockchain for DApp developers.
Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.
Source: https://www.thecoinrepublic.com/2023/05/10/cardano-uses-hydra-to-compete-with-ethereum-as-gas-fees-soar/