Why Cardano Is Not Aiming For Scalability With A ‘Million TPS’?

• Soon after the announcement of its performance enhancements in its 2020 roadmap, Cardano Blockchain is in its Basho phase, where it refuses to define scalability in terms of ‘a million TPS.’

• Hydra Heads, which is an off-chain mini-ledger between participants, excel in attaining near-instant finality within a Head, said IOHK that backs Cardano.

• This week, the Hydra team also disclosed that the work on the final version of on-chain validators is completed.

IOHK Prioritizing Throughput, Finality

Cardano is presently in its Basho phase after the blockchain platform announced its performance enhancements in its 2022 roadmap. Basho phase is the phase where it declines to define scalability in context to ‘a million TPS.’

A recently published blog post, states that TPS is likely to be the least meaningful metric to acknowledge as a means of comparison among the ones available. 

It explains that the transactions happen in different forms and sizes, especially when comparing different platforms. Therefore, it makes sense to utilize TPS as a metric under the same context, for instance, when comparing two versions of Cardano nodes. However, it is not meaningful to use it as a means to compare between blockchains. 

Hence, in this light, the company that supports Cardano, IOHK, prioritizes finality, throughput, and cryptocurrency as essential metrics. Finality is the time that system takes to finalize a transaction while the throughput is the volume of processed data within a specified period. In addition, IOHK defined concurrency as the total work that can be done without blocking each other.

Hydra Head & Performance

For Cardano, Basho is the network optimization and scaling phase. Hydra is a crucial protocol for scaling in it. Since Hydra kick-started after Alonzo, it gained attention as an ensemble of layer 2 solutions. Charles Hoskinson, Chief of IOHK, said:

A huge amount of transaction traffic generated from all the apps launching soon will be offloaded by it. Cardano will soon be hit by an enormous amount of traffic as PAB goes online and Hydra is the requirement for the same. 

An off-chain mini ledger among participants dubbed Hydra Head is part of the journey of Cardano’s scalability. IOHK also stated that in attaining finality within a Head, Hydra Head excels. 

This week, the Hydra team also made the announcement that the work on on-chain validators’ first version is completed. In addition, it also revealed the completion of publishing of the engineering roadmap for Hydra Head.

On the other hand, in order to avoid any future congestion issues on its dApps, Cardano is scaling. Also, ADA wallets are on the way up. Quite recently, in terms of active wallets, the company achieved a milestone of three million. It’s a noticeable hike from 200,000 at the beginning of 2021.

With the recent upgrades, Kraken’s recent report shows that there is a significant increase in the activity of the network.

In the past week, ADA, its native token, managed to increase by around 10%. At the time of writing, the price of ADA was standing at $1.13, down by 2.43% in the last 24 hours. 

Nonetheless, it is still down by more than 60% from its ATH (all-time-high) seen back in September 2021. 

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Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.

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