Ethereum is the leading smart contract platform in the crypto-economy today. However, its high gas fees are one of the issues why DeFi investors are looking for other blockchains. Therefore, in this article, we’ll tell you why Cardano or Polkadot might substitute Ethereum in the future.
Firstly, on the Cardano or Polkadot comparison, we’ll analyze wallets, scalability capacity, governance, team, POS systems, and Consensus mechanisms.
Also, recent announcements, partnerships, programming languages, and tokens to determine which project has the best chance of overthrowing Ethereum. Let’s start with Cardano.
What is Cardano ($ADA)?
Firstly, Cardano blockchain is an open-source platform that will allow users to create decentralized smart contracts. Both enterprises and governments use this blockchain. The team aims to:
- Dominate the dApp sector.
- Provide security to decentralized applications, systems.
- Create a scalable, interoperable third-generation blockchain.
Secondly, the native token of Cardano is $ADA, in honor of 19th-century mathematician Ada Lovelace. Therefore, most developers consider her the first computer programmer.
Cardano’s Wallet Analysis
Cardano has its official wallet called Daedalus. This secure wallet has many features, such as a full node running Cardano’s’ blockchain and delegated staking options. Then, Cardano is also compatible with other wallets such as Yoroi, Ledger, and Trezor.
In the early days, Cardano could handle only around 257 transactions per second (TPS). For instance, Cardano introduced new state channels known as Hydra heads which claim around 1,000 TPS.
The governance system used in Cardano is off-chain, which is like Ethereum. In the Cardano network, the Cardano Foundation and IOHK make the governing decisions. Consequently, when the Voltaire era begins, governance becomes public.
The founder of Cardano is Charles Hoskinson. He is a trained mathematician. Earlier, he was also associated with the early development of Bitcoin and co-founded Ethereum. Also, he was one of the founding chairmen of the Bitcoin Foundation’s education committee.
Validation on Cardano
Cardano is a public distributed network that is ”the people’s network” with more PoS validators than every project except ETH 2.0. Cardano pays for any transaction or deployment of a smart contract in its ecosystem. $ADA coins go to stakers who keep the network operating and secure.
Consensus Mechanism on Cardano
Cardano utilizes a proof-of-stake protocol named Ouroboros. It is also one of the first blockchain protocols based on peer-reviewed research. Also, Cardano is one of the most prominent blockchains to use a proof-of-stake (POS) consensus mechanism. POS is less energy-intensive than the proof-of-work algorithm.
The Cardano team recently completed the Goguen upgrade. The following upgrades are:
- The Basho era centered around scalability and interoperability improvement.
- The Voltaire era includes adding a treasury system and governance.
In addition, once Voltaire is ready, users will build their on-chain tokens for transactions on Cardano. Like Ethereum, Binance, or other token protocols, users can buy and sell these custom tokens like $ADA on Cardano.
This blockchain had four meaningful partnerships in recent months.
- Cardano partnered with Shopify to let shoppers use ADA for payment in Shopify stores. Users can send ADA tokens directly to the stores” wallets. No intermediary can track these transactions.
- The decentralized A.I. network SingularityNET collaborated with Cardano to solve its speed and cost issues. The team has moved a significant part of its network from Ethereum to the Cardano blockchain.
- The United Nations and IOHK partnered to conduct U.N. new proposals via IOHK’s’ blockchain-based voting system. The ADA team has collaborated with one of the biggest payment platforms in South Korea named Metaps Plus.
- EMURGO, the commercial arm of Cardano, has a partnership with Bidali. Bidali is a Canadian payment processor, which strives to be a next-generation digital currency payment solution. With this integration, $ADA holders can purchase any item directly using Bidali’s’ online gift card platform. This includes over 1,200 major retail brands, such as Nike, Amazon, Starbucks, and many more.
Cardano’s Programming Language
Cardano uses a new domain-specific language (DSL) for developing decentralized applications (dApps) on the blockchain named Glow. Developers use Glow to secure dApps and smart contracts, which lets them run dApps safely in an adversarial environment. Glow is used for smart contracts, but anyone can develop an entire dApp, including client code and formal proofs.
$ADA Token Analysis
At the time of writing the article, $ADA was trading close to USD 2.00. The circulating supply of ADA was 32 billion ADA coins with a maximum supply of 45 Billion. Currently, it holds the 5th highest market cap, according to CoinMarketCap.
What is Polkadot ($DOT)?
On the other hand, in the Cardano or Polkadot comparison, We’ll continue with Polkadot. This is an open-source multi-chain platform that allows:
- The cross-chain transfer of any data or asset type
- Connectivity between different blockchains
- Users to create smart contracts, tokens, and even new blockchain without forking.
The native token of Polkadot is $DOT. It’s’ used to pay fees between chains, for governance, and bonding between chains.
Polkadot’s Wallet Analysis
The Polka wallet app is one of the most popular options to save $DOT coins. Users can use this wallet for the transfer of assets to any account on the network. It also supports the scanning of Q.R. codes for quick transactions. This wallet has features like:
- A hot wallet that has access to the web
- A cold wallet that isolates the network and signs offline.
- An account recovery plan through users social media accounts
Therefore, many wallets support $DOT, including the Ledger hardware wallet and the popular Metamask browser wallet.
Parachains in Polkadot solve scalability issues through a divide-and-conquer approach. With $DOT, users can create new parallel blockchains (a parachain). Also, $DOT can process up to 1500 transactions per second (TPS)
The governance system used in Polkadot is On-chain. It relies on two specific collectives: The Council and the Technical Committee. Also, they manage exceptional events such as protocol upgrades and fixes. All stakers vote on proposals and participate in governance.
The founders of Polkadot are Dr. Gavin Wood, Peter Czaban, and Robert Habermeier. Dr. Wood is Ph.D. in Software Engineering and has over 20 years of experience in software development.
On the other hand, Wood coded the primary functional version of Ethereum and even authored Ethereum’s’ Yellow Paper. Parity Technologies is a prominent contributor too.
Validation on Polkadot
Polkadot has 912 validators in the relay chain. These are split into smaller numbers to validate each parachain. Moreover, these validators have options to allow other bonded parties to nominate one or more validators to act for them.
Consensus Mechanism on Polkadot
The team uses the GRANDPA (GHOST-based Recursive Ancestor Deriving Prefix Agreement) consensus to make the Polkadot network more secure and resilient. In good network conditions, it can confirm blocks instantly. Under more challenging network conditions, such as network partition, GRANDPA can finalize large blocks at once.
Additionally, the polkadot network uses the NPoS (nominated proof-of-stake) mechanism to select validators and nominators to maximize chain security.
Recent Developments on Polkadot
Due to the parachains flexible ecosystem, many new projects were already launched on Polkadot, such as REEF, PHA, XFT, CRU, REN, O.M., AKRO, XOR, and others. Additionally, every platform has different APYs for staking DOT, which can go up to 20.27%. Currently, over $21 billion worth of DOT has been staked.
Also, to enhance parachains and their related technologies, Polkadot recently launched a new testnet called Rococo. The primary function of Rococo is to test parachain functionality. The team will integrate a lot of other tasks in Rococo like:
- XCMP (Cross-Chain Messaging Passing)
- Parachain-to-parachain direct messaging
Partnerships on Polkadot
Polkadot also has had four impressive partnerships in recent months.
- Binance established a $10 million fund to create innovative projects on the Polkadot ecosystem and bring decentralized finance (DeFi) for users.
- Evercity teamed up with Polkadot to build their smart, sustainable bond protocol with a significantly lower carbon footprint than other blockchain solutions.
- Chainlink partnered with Polkadot to provide oracles for the entire DOT network. Chainlink’s decentralized oracle helps networks to connect their smart contracts quickly.
- Polkadot collaborated with Akropolis. The Akropolis chain provides core financial services without depending on banks, governments, or financial institutions.
Polkadot’s Programming Language
Moreover, at the time of writing this article, $DOT was trading close to USD 42.38. The circulating supply of $DOT was 1 billion coins with a total supply of 1.1 billion. Currently, it holds the 8th highest market cap, according to CoinMarketCap, with USD 44 billion.
Finally, in this last section of the Cardano or Polkadot analysis, we’ll say which blockchain is better in every single factor that we’ve analyzed previously:
- Wallet: We give a slight edge to Polkadot for having a cold wallet feature and additional wallet recovery options, although both are good wallets.
- Scalability: We give the edge here to Polkadot since you can create your chain if you need super-fast transactions.
- Governance: Here, Polkadot wins for being on-chain. It will be even if Cardano goes on-chain for governance as they plan to.
- Team: Here, we split. Both have good founding teams with relevant skills and pedigree.
- Validation: We give the edge to Cardano here, although both have sound systems.
- Consensus Mechanism: We give the slight edge to Cardano here as it is known that tough conditions can delay the DOT network requiring a mass confirmation of blocks at once.
- Recent Developments: Polkadot wins here for flexibility and choices. After Voltaire, it will be close to even with Cardano’s’ added capabilities.
- Partnerships: Both are doing well in this area, but we give the edge to Cardano for getting both Shopify and the U.N. on board.
- Programming Language: Polkadot’s’ flexibility is the clear winner here
After analyzing each of the nine key factors of the Cardano or Polkadot comparison, we conclude that Polkadot is the strongest competitor of Ethereum’s blockchain.
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