by Juan M. Villaverde
If Aesop's classic tale of the Tortoise and the Hare were applied to crypto, Cardano (ADA) would be the former; Bitcoin and Ethereum would be latter.
What still remains to be seen is, who will win the race in the end?
Cardano has dozens of top computer scientists, cryptographers and mathematicians. They submit papers on their work for academic peer review.
And their goal is to ensure each piece of crypto infrastructure they create is so solidly built, millions will one day be able to rely upon it. All without worrying it could crumble under the weight and stress of operating in the real world.
Cardano founder Charles Hoskinson likes to say he's building a system to last 100 years. This is in sharp contrast to the approach taken by Ethereum (ETH) or Bitcoin (BTC), Cardano's closest competitors; the hares to its tortoise.
Eschewing the methodical, get-everything-right-the-first-time approach of Cardano, ETH and BTC have mostly been racing to get something that works now, content to let future problems take care of themselves.
"Full speed ahead ... and damn the torpedoes!" as one of America's Civil War admirals once said. Trouble is ...
Murphy's Law Can be Especially Tough On the Hares of Crypto World
Bitcoin has managed to be successful, using this approach. But only by confining itself to a single use-case: store of value, with some payment functionality sprinkled on top.
Ethereum has a much grander vision: an energy-efficient, fully decentralized ledger that can scale up to millions of transactions per second ... and yet be so lightweight, it could run on a home PC.
The reality is Ethereum today suffers from bottlenecks so severe a single application (like the CryptoKitties game) can cause it to grind to a halt. It's also a profligate consumer of electricity, much like Bitcoin.
And yet, despite the energy consumption, it’s relatively less secure, due to the flexibility and scope of the distributed applications (dApps) that can run on it.
The biggest dilemma: Developers have not yet figured out how to get Ethereum from where it is today ... to anywhere near its grand vision.
And Then Along Comes the Tortoise, Cardano
The ADA team rejects the impatient, try-anything-until-something-sticks-and-damn-the-consequences approach.
They insist that a proper distributed ledger should be like a bridge on a superhighway ... or a long-distance spacecraft: Mission-critical infrastructure and vehicles that simply cannot be allowed to fail. Because countless lives, fortunes and futures will depend upon them.
And building something that safe and solid ... takes time.
For example, so far ADA developers have rebuilt their codebase three times from scratch. Repeated redesigns make it hard for wallet providers to integrate ADA into their systems — which is a big reason you don’t find a lot of wallets supporting Cardano.
Moreover, work is still in such an early stage that developers continue to control all the nodes in the network. And all it can actually be used for is to send payments back and forth.
In a nutshell, progress often seems exasperatingly slow.
But in the end, Hoskinson and his team say it's more than worth it. They remain committed to their vision. And at least in one sense, they’ve already been proven correct.
Consider the flipside: To major financial institutions and businesses, Ethereum and Bitcoin still seem more experimental than solidly established — a key reason they’ve been unwilling to migrate over.
Will Cardano assuage these concerns and finally bring the true, incredible potential of cryptocurrencies to fruition in the real world? Forthcoming events are about to deliver some answers:
A few weeks from now, ADA will hit the next phase of its long development roadmap, with the release of a testnet. This will allow public nodes to run the Cardano ledger in an environment that closely simulates reality. For the first time, independent validators will be able to run a beta version of the ADA ledger.
After this, staking will be allowed. This means small token-holders will be able to pool their resources to validate the Cardano ledger, and earn the rewards for it. This will give people a convincing near-term reason to buy and hold ADA coins. And it’s likely to breathe new life into ADA tokens.
This is a key milestone.
How all this plays out, of course, remains to be seen. Will Cardano's resolutely measured advance be fast enough to stay competitive? Or will it be left in the dust by a resurgent Ethereum, and a handful of red-hot new cryptos?
Only time will tell. Stay tuned.
Juan Villaverde is an econometrician and mathematician devoted to the analysis of cryptocurrencies since 2012. He leads the Weiss Ratings team of analysts and computer programmers who created the first-of-their-kind Weiss Cryptocurrency Ratings.
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