FUD or Facts: Concurrency Issues Plague Cardano’s Smart Contract Rollout
Cardano is currently one of the trending blockchain platforms, with the developers and users anticipating the launch of smart contracts on its network.
However, with the launch date engine ever closer, there appear to be some issues under the hood.
Hype Preceding Alonzo’s Arrival
Earlier this week, Input Output Hong Kong (IOHK) – the developers of the Cardano blockchain – confirmed on social media that smart contracts would go live on the network’s mainnet on September 12. The tweet explained that a proposal for Cardano’s Alonzo upgrade had successfully been submitted, and the major upgrade would happen as scheduled.
This is a huge deal. Smart contracts have always been a major deficiency of the Cardano blockchain, and their inclusion will bring it on par with more established chains like Ethereum. The addition of smart contracts also means that Cardano can finally be home to decentralized finance (DeFi) protocols and more.
The anticipation of smart contracts has been a major driving force of growth for Cardano’s ADA token, which blitzed its previous all-time high and set a new high above the $3 mark earlier this month. It is also worth noting that the upgrade has so far gone according to schedule – timing has plagued Cardano’s main competitor, Ethereum, as it looks to move to a proof-of-stake consensus algorithm with its ETH 2.0 upgrade.
Problems and FUD Leave Cardano in a Dire Spot
Despite the excitement, however, there appears to be growing criticism for the Alonzo upgrade. Last Thursday, IOHK announced the launch of the Plutus smart contract functionality on Cardano’s testnet. Minswap, a multi-pool decentralized crypto exchange launched on the Cardano testnet, has since run into concurrency issues. The company eventually shut down its testnet on Sunday, pledging to be back after resolving its problems.
Minswap users criticized it for slow transactions, with the service reportedly only handling one transaction per block. Minswap’s difficulties were reportedly due to Cardano’s use of “unspent transaction outputs” (UXTO), which help to track user funds. Other decentralized exchanges may have to deal with the same problem, meaning that Cardano might have scalability issues.
So far, Cardano hasn’t responded to the criticism. However, the company’s chief executive Charles Hoskinson has explained that many of these critics simply don’t understand Alonzo or what Cardano is looking to do. Hoskinson said in a tweet,
“As expected, there is a massive FUD storm underway. We saw the same with Shelley last year. It's nothing new. Just people wanting to burn down what they don't understand or feel threatened by. September 12th is a big day, but just a day on a long journey we are all on together.”
The criticism couldn’t come at a worse time for ADA, which was also swept as the market corrected on Tuesday. After hitting an all-time high of $3.09 on September 2, ADA has continued to plunge. The asset is now trading down 10.7 percent in the past day, holding at $2.42.