Is Cardano Dead? The Best Hype-Free Article You’ll Find!

The Cardano blockchain project is dead or well alive depending on who you ask. At the peak of its recent highs in November 2021, the (ADA) cryptocurrency hit a market valuation above $50 billion. Such a high valuation has not stopped critics from questioning Cardano’s status as a top-tier blockchain network.

This article provides an unbiased review of the question, Is Cardano Dead? Ideally, there is no clear-cut answer to the question, although you can draw conclusions based on publicly verifiable information.

Here’s a quick outline to make your navigation easier:

What is Cardano?

Launched in 2017, Cardano describes itself as the first blockchain built through peer-reviewed research. The protocol utilizes the popular Proof-of-Stake (PoS) consensus to verify transactions. The underlying network utilizes ADA as its native cryptocurrency. It is also designed to support the transfer of assets and the development of decentralized applications. 

The Cardano project is governed by three entities, namely, the Cardano Foundation (an independent body to support ecosystem development), IOHK (the technology and engineering company), and Emurgo (the project’s commercial arm). Ethereum co-founder Charles Hoskinson is the face of Cardano, having co-founded the project after falling out with the Ethereum core development team.

Having some background about what Cardano paves the way for us to attack the “elephant in the room,” the question – is Cardano dead?

Cardano is Dead or? What Facts Reveal

Cardano’s position as the eighth-largest cryptocurrency means it is not dead (at least in terms of market capitalization). There are also an estimated 3.6 million ADA holders, suggesting sustained investor interest in the project. 

Meanwhile, over 72% of the total coin supply is staked as investors seize the opportunity to earn a yield on their assets. Cardano also boasts a rising ecosystem around decentralized applications spanning finance and NFTs.

Data from DeFi Llama also reveals around $113 million worth of total value locked (TVL) in the Cardano DeFi ecosystem with apps such as Wingriders, Minswap, Sundaeswap, and LendingPond among the largest.

(Source: DeFi Llama)

Concerns Around Cardano

One of the easiest and most straightforward ways to evaluate any company is through competitor analysis. Hence, in trying to find out if Cardano is dead, it is worth taking a closer look at some of Cardano’s rivals (or perhaps outperformers).

Cardano is often branded by proponents as an “Ethereum killer,” a term that typically applies to next-generation blockchain projects aiming to improve on the inherent challenges facing the Ethereum network. While so-called “Ethereum killers” dream of eventually competing with or overtaking Ethereum, Cardano arguably comes last on the list of candidates. The reasons are not far-fetched.

Other competing networks such as BNB Chain, Solana, and Polygon already implement smart contract functionality and have onboarded millions of users through this use case. In contrast, Cardano, despite launching several years ahead of these competitors, only introduced smart contracts in September 2021. 

In a rapidly evolving market where Bitcoin and Ethereum have captured large market share because of first-mover advantage, Cardano’s late arrival to the smart contract party means it faces an uphill task against competitors. According to DeFilLama, Cardano currently ranks 29th on the list of blockchain networks by the value of assets locked in DeFi protocols.

Cardano isn’t doing much better than its competitors in terms of speed. Granted, Cardano’s reported speed of around 257 transactions per second (TPS) significantly exceeds Ethereum’s 10-15 tps limit. However, it pales in comparison when compared to the over 300 TPS on BNB Chain, and the over 2000 tps on Solana.

Observers might also assume that Cardano’s delayed smart contract release might have allowed the project to significantly fix scalability issues. However, the network also faces the same congestion issues synonymous with other layer-1 networks, despite significantly lower user adoption. In March 2022, Cardano reportedly recorded around 100,000 active addresses, less than 20% of the average users (around 500,000) on the Ethereum network.

Blockchain networks typically scale by onboarding developers to build applications that attract users. By far, the Ethereum-centric programming language, Solidity, has gained popularity in the past decade and remains the most used language for blockchain developers.

Other competitors including BNB Chain, Avalanche, and Polygon have gained traction by introducing support for the Ethereum Virtual Machine (EVM), which makes it easier for developers to deploy native apps on these competing networks. However, Cardano is still on the path to supporting EVM, with the solution recently launched on testnet.

Without EVM support, developers must typically learn from scratch Cardano’s native programming language, Haskell, and Plutus’s script to build apps and interact with the network. The onboarding experience hasn’t been the most ideal, increasing the barrier for developers to jump ship from other thriving ecosystems to Cardano’s.

Hence, the inability to onboard developers rapidly is another reason why some investors argue that Cardano is dead. The ecosystem needs top talent to thrive, and the current landscape suggests that a lot of work still needs to be done for Cardano to truly compete in the dApp space.

Conclusion

A closer look at the Cardano blockchain project and its ecosystem gives evidence that Cardano is not dead (at least in the meantime). However, concerns around the project’s ability to compete against rival networks mean investors must remain wary of a potential downward spiral, especially as the cryptocurrency industry approaches mainstream adoption.