Cardano Founder Identifies “Long Overdue” Protocol that Could Massively Improve Cardano

Cardano founder Charles Hoskinson recently identified a “long overdue” enhancement that could bring crucial improvements to the Cardano blockchain. 

He mentioned this in a discussion started by Cardano blockchain developer Andrew Westberg. Notably, in an X post, the prominent developer recently triggered a conversation on the priorities for the platform’s future.

Cardano Should Prioritize Validation Zones

Interestingly, Westberg argued that the introduction of Validation Zones should be the top priority for Cardano. He chose this over other proposed enhancements, such as fast finality protocols for sidechains, suggesting that these would not benefit the main Cardano chain directly.

According to Westberg, increasing block size, implementing transaction chaining, and addressing UTXO (Unspent Transaction Output) contention could take Cardano further than solutions solely focused on improving decentralized applications (dApps). 

He pointed out that despite the potential to support thousands of dApps, Cardano’s current architecture limits how fast individual applications can operate. However, Validation Zones could resolve multiple issues, bolstering Cardano’s potential.

Addressing UTXO Contention and Enhancing Composability

Westberg explained that UTXO contention—a problem where transactions clash for access to the same outputs—remains a crucial issue for Cardano. 

Notably, besides Cardano, the problem also affects other blockchains that rely on the UTXO model. He stressed that users often see multiple transactions for a single action in their wallets due to this contention. 

Input endorser does not solve utxo contention. Utxo contention and non composability is why every dex swap you do and most dapps show up as 2 txns in your wallet.

— Andrew Westberg (@amw7) October 15, 2024

Validation Zones, as proposed in the CIP-118 proposal, could resolve this and allow the platform to pack transactions more efficiently. In turn, this will massively improve composability and transaction processing.

Moreover, Westberg mentioned that introducing Validation Zones would enable other much-anticipated features like Babel Fees, which allow users to pay transaction fees in tokens other than ADA, the native cryptocurrency of Cardano. 

With the support for composability, Validation Zones would let Cardano optimize its transaction processing without compromising its unique eUTxO (extended Unspent Transaction Output) model, which prioritizes security and transparency.

Cardano Founder’s Support

Charles Hoskinson responded to Westberg’s remarks, endorsing the developer’s stance. He agreed that Validation Zones should have been implemented much earlier, stressing their importance in improving the network. 

Andrew is correct. It’s a long overdue enhancement that will massively improve cardano. https://t.co/G0N6lZLFWs

— Charles Hoskinson (@IOHK_Charles) October 15, 2024

The protocol enhancements Westberg mentioned are detailed in CIP-118, a Cardano Improvement Proposal that introduces a new structure called Validation Zones. 

These zones would allow the processing of partial, incomplete transactions—also known as “intents”—by creating a framework that supports both “requests” and “fulfillments.” 

In practice, this would help improve processes like swaps and other decentralized exchange (DEX) functions by allowing transactions to remain flexible until they are fully validated. This structure would maintain Cardano’s robust ledger guarantees and boost efficiency.

The proposal is in response to CPS-15, which outlines the problems Cardano faces with intent-based interactions. CPS-15 discusses how Cardano’s strict transaction validation rules create challenges for users looking to interact with applications in real-time. 

For instance, Ethereum allows for some non-deterministic behavior in its smart contracts. However, Cardano prioritizes security by ensuring that each transaction is fully specified, which can limit flexibility and lead to the well-known “concurrency problem.”