The
third-largest cryptocurrency is getting a significant network upgrade. Are you
prepared?
Cardano's ADA
cryptocurrency overtook Bitcoin and Ethereum as the world's third-largest
virtual currency by market capitalization in August 2021. ADA has increased by
more than 1300 percent in 2021, and by 130 percent just in August. It broke the
$3 barrier for the first time in early September, as anticipation for the smart
contract launch, grew.
Although ADA
has since fallen below the $3 mark, it is poised to continue its meteoric rise
with the addition of smart contract functionality. We'll look at what ADA smart
contracts are and why they could be a game-changer for this cryptocurrency in
this article.
What Exactly Are ADA Smart Contracts? The code name Alonzo refers to the
major upgrade (considered a hard fork) that will bring smart contract
functionality to the Cardano network. ADA, like all cryptocurrencies, employs
blockchain technology to record and track information exchange.
Smart
contracts are small pieces of code that run automatically when certain
conditions are met and are stored on a blockchain. Their magic is in making the
blockchain programmable, which allows developers to build decentralized
applications on top of Cardano.
Smart
contracts will bring three significant improvements to the Cardano ecosystem:
a. Applications of Decentralized Finance (Defi):
These are
financial applications that operate without the use of middlemen such as banks
or brokerages, allowing sellers, buyers, and lenders to transact directly with
one another.
b. Non-fungible Tokens (NFTs):
The Cardano
platform will be able to mint NFTs with the Alonzo update. These one-of-a-kind
digital assets can represent anything from artwork to sports cards with digital
signatures proving ownership.
c. Gaming:
Using NFTs,
gamers will be able to buy, own, and sell in-game assets.
Programming Language:
Plutus is the the programming language used to create Cardano smart contracts. It's already live
on Cardano's testnet, allowing developers to build and test apps before they go
public.
When
Will ADA Smart Contracts Be Available?
Cardano's long-awaited smart contracts will go live on September 12th, 2021. The company behind Cardano's smart contract platform, Input-Output HK, confirmed the date on Twitter, saying it had successfully submitted an updated proposal.
On September
12th, the proposal will cause the third and final hard fork combinator event,
resulting in the full implementation of smart contract capabilities on the
Cardano blockchain.
Cardano's
Future and Smart Contracts
The Cardano
blockchain's smart contract functionality is a game-changer, elevating the
crypto-currency to the same level as Ethereum, Solana, and Zilliqa. Cardano
users will be able to buy, sell, and trade without the need for an intermediary
thanks to the upgrade. As a result, investors anticipate that the upgrade will
drive Cardano's price to new highs. Meanwhile, we'll have to wait and see if
Cardano's foray into smart contracts pays off.
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