CARDANO

cardano

Cardano is striving to change the way crypto currencies are made and also design a system that will integrate with legacy systems, or simply work in their stead in places without enough money to make them work.  This project is a collaboration of the brightest minds from across the world, not claiming to be the best or the answer, but a best effort to provide a single, good answer.  This second part of the Cardano review will go deeper into the core components as identified by the Cardano team.

Cardano Science & Engineering

Focus on continuous change, Cardano has made it clear that a rigid plan is the road to failure.  They refuse to be bound by a white paper, but also see the clear need for documentation, peer review and the ability to constantly improve and upgrade the system toward betterment.  Their first step in building a foundation was to utilize Ourboros Proof of Stake algorithm as it has been tested rigorously and designed with security as the primary objective.  This is vita moving forward as most protocols are designed for speed first, then see security added later, in a far less effective manner.  The energy consumption has also been a huge elephant in the room when it comes to Bitcoin.  It is estimated that nearly 4 US households can be powered for an entire day just by the energy used to verify a single BTC transaction.  That is hugely unsustainable and generally inefficient, which is not something we want for a financial system.  Efficiency reduces friction and cost, which is vital for making this system available to developing nations and the world as a whole in our preparation for the impacts of automation.  With Ourboros and generally Proof of Stake (PoS) algorithms, you must hold a considerable amount of the token to gain trust.  Your stake is equivalent to how much of the currency you own AND stake.  That is to say, you have promised to have and to hold, in sickness and in health, this crypto.  You’re not spending it or trading the currency, but you’re staking it in a safety deposit box and are risking your stake by doing anything illegitimate as a master node or Slot Leader in the case of Ourboros.  This creates the trust relationship for the protocol to successfully run.  This does present a major concern for the future as cryptos become bigger, at what point will we see governments or powerful organizations spend the money to run a couple master nodes just for the purpose of crashing the system in favor of a competitor?  That being said, this is still the best system we have to date.  New Slot Leaders or Master Nodes are elected by stake holders for each time slot, with those having more stake having a higher chance of being elected.  This also helps mitigate a bad actor as mentioned in case of a rogue nation seeking to destroy the system.

Haskell was chosen as the core language, a fork of Electron, Daedalus, was chosen for the interface.  Web architecture was chosen as much as possible and a key-value paradigm with RocksDB was used for the database.  All of these decisions were great for there history and robust infrastructure and community support.  We’re seeing the greatness made possible through Open-source projects.  The modularity, robust fault tolerance and recent shift toward web app development support, Haskell became a front runner.  This language was also chosen because of the dev pool consisting of a great deal of people within academia.  Academia is usually not the best place to find experience for a decentralized project, in my experience however, Cardano seems to be proving me wrong.  They may have gone so far as to focus too much on the methodology and details of their implementation.  A majority of the documentation is discussion of what not to do and why they made their choices.  Get down to brass tacks folks.

 

 

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Transparency in development

To avoid the hurdle of debates being co-opted or anyone asking “stupid” questions, the debates and preliminary decisions are being held behind closed doors.  The Cardano Foundation will release reports on that information once decided upon and reviewed by the members or assignees.  This makes sense in keeping everyone up to date, but realizing that not everyone’s opinion is necessarily important in the initial development.  Upon creation of the development fund, teams will be given the opportunity to compete for implementation after going through foundation review.  This creates accountability and great opportunity to create the best possible product.  The other side of this is the concern over centralized control.  Fortunately, with crypto, it’s totally achievable to just move to a different platform, forcing a certain level of common sense be applied and mitigating authoritarianism.  This is evident with the fall of BTC.  While still the leader, it has been knocked back considerably after the political wreck of BCash.  They have seen how insignificant they are with free market offering no protection.

Great moves are being made to ensure blockchain can respect legal authority and adjust reputations in event of slander or malicious acts.  This will lead to some very concerning practices with smart contracts likely becoming the go to for all transactions as they need to then be mutable.  As long as nothing is done to allow alteration to the blockchain and only a transaction conducted within a smart contract, the system can remain in high integrity and trust.  The Town Crier Protocol is one technology being looked at for data integrity, while allowing integration of web content into smart contracts and applications.  They’re also making strides to create a reliable, community curated source list for information to ensure maximum quality and data integrity.  At present this is fairly centralized, but is expected to have more sources in the future from the community curation.  Challenges will increase significantly as legacy systems are integrated.  Many have little to no security due to their functionality for decades.  Some systems like land and physical assets will pose an even more unique problem as the information source can be completely accurate, but it can’t force the movement of property.  Just because the ledger say Jim sold his car you Jill doesn’t mean he will legitimately relinquish possession.  These instances then require more finesse and less structure, which goes whole heartedly against blockchain.   To ensure these people and organizations act appropriately, Cardano is looking into protocols to overlay for the purpose of allowing decentralized identity to be established.

Multi-Chain Interoperability

Cardano developers are creating a new protocol that will allow multi-chain interoperability through a side-chain.  This will support movement of assets across chains.  This is absolutely revolutionary in the burgeoning industry and provides a great deal of hope for future capabilities.  To facilitate this, Cardano is creating a web store of sorts to further make available apps to support a growing user base.  This is being done through Electron on GitHub.  We’ll get into Daedalus next week as that is where some of the really cool stuff happens.

 

Let me know if you have any questions or comments, even better, corrections.  Let me know where I messed up.

 

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