I’ve seen a lot of comments from people on Reddit saying they cannot understand why anyone would invest in Cardano. Well here is my response to them.
Why I prefer Cardano over Eth
1. Development Activity
I recall one of the reasons that I decided to even look into Cardano, two years ago, was research that showed price growth in crypto assets correlates with Github activity. For those that don’t know, GitHub is an online code repository for open source code software, which a lot of crypto is. When a developer submits code to the online repository, its recorded for all to see. Cardano was number one in Github activity back then and has pretty much remained number 1 ever since. Ethereum has more developers, 456 vs. 111, according to a January article I found but the Cardano team produce more per developer [1].
Now don’t get me wrong – both projects are some of the most active projects out there, but knowing this gives me confidence that there is an active team behind Cardano. Furthermore, while Ethereum development is a decentralized approach (anyone can technically be an Ethereum dev if they have the time and energy), Cardano development happens through a professional company (IOG) that is technically contracted by the community to perform the work (I believe the community need to vote on renewing the contract at some point). I think the Eth approach is quite noble, but the IOG approach is more practical. I personally feel having a dedicated company being contracted to perform the work means greater efficiency.
2. Enterprise Minded
Similar to VeChain, the Cardano project is much more focused on being a blockchain that professional institutions can use. This permeates through all of the AMAs that Charles Hoskinson does. For example a deal with the Ethiopian governmentwas announced earlier this year, and there is already a pilot project, known as BeefChain, in the food supply industry.
To me Ethereum seems to be much more of an open playground for Decentralised Finance Projects (DeFi) which don’ t get me wrong is great, but appealing to traditional corporates seems a bit of an anathema. Cardano is one of the few crypto projects that has a focus on helping real world businesses. The Atala Prism identity solution is another great example of something that would be of importance to business and regulators.
Furthermore, having a centralized entity like IOG means corporates have someone they can partner with to help them build out blockchain solutions.
3. State of the Dapps
Continuing on with this theme, let’s take a look at the much vaunted Eth ecosystem. If you look at the Ethereum Dapps list you will see that DeFi, Gambling, and Games make up the majority of Dapps. When you try filtering on more business minded categories such as health and insurance you get a handful of dapps with mostly zero activity. This tells me that it is still very early days for blockchain technology and the market place is mostly around developers that want to get rich quick i.e. DeFi, Gambling, and even the games with the NFT tokens. Nothing wrong with that at all, but who is developing the more mundane dapps that have a real practical use in the busines world? That is going on in pockets, businesses are experimenting, but as I said it’s still very early days and the eth community is not focused on it.
4. Gas fees
I won’t labor this point much as it’s well known. High gas fees on Ethereum mean Dapps are increasingly looking to be multi-chain. While these fees have come down a little bit in recent months due to dapps moving to less secure layer two solutions such as matic, Cardano will soon offer a very viable alternative to Dapps looking for a low fee solution.
5. The development roadmap
Cardano has been criticized in the past for being slow. Some of the criticism has been fair – they made a few design mistakes early on that they then had to change track on later, but since the time I’ve been involved (roughly 2 years ago today) I have seen a clear articulation of the roadmap, and the milestones on that roadmap being reached, give or take a few months.
On the Ethereum side, I’ve seen numerous course corrections, even in in the past 12 months. An updated roadmap was released in the summer of 2020, then by the end of the year another one was released once they realized the first one was too linear. A few months after that they suggested that the docking phase where the Ethereum mainnet runs on Proof of stake, could be prioritized and brought forward. It doesn’t fill me with confidence to see a development team lurching from one plan to another.
With Cardano we were told there would be an incentivized testnet and there was. Next was Shelley and that launched on time. The move away from centralized federated POS nodes to decentralized ones is happening like clockwork and due to be at 100% by month end. The 2 Goguen era Hard-Fork combinator events have happened as expected and the final one is expected to be in the next 4-8 weeks. We’ve already started seeing voting being implemented sooner than we initially thought and will be completed later this year, then there’s talk of the Hydra solution to ramp up the scalability even further as well as further improvements to the consensus protocol in the form of Ouroboros Omega.
6. Research and Development
Ah finally I get to what many of you thought would have been my number one point. The much acclaimed “research based approach” to development. From the outset Cardano sought to partner with academia to help it research blockchain technology in order to build it properly. Where as Ethereum took the fast-out-the-gate and fix things later approach, Cardano has taken the slow and steady approach and in my mind it will pay off. Very shortly Cardano will have launch a smart contract platform that is secure and scalable, where as Eth 2.0 has only just started its development and the roadmap is still in flux as mentioned earlier. But the difference is more profound than that – due to the way Cardano has been built, it now has an ample pool of new brainpower feeding into its design, implementation, and adoption. Its solid design is also making it easier to turn out new innovations more quickly – the integration of the IELE VM to allow solidity to be used on Cardano was first started in the second half of last year and is due out soon (or may already be out).
CH has also talked about launching an NFT marketplace, better developer tooling, an Oracle solution and so on. Because Cardano has built on a solid foundation, developing all these extras is easier. Meanwhile Eth is having to go back and rebuilt the foundation.
7. Staking
I actually wrote this entire article before I realized I’d totally neglected to mention staking. Honestly if you haven’t tried it, but $20 worth of Cardano just to experience the staking process. It’s so easy to use. I think I’m averaging ~6% returns, but it’s really nice to know my Ada is earning me more Ada every week and makes me less likely to rush out and sell due to a market dip.
8. Communication
Name one other project where the founder is as open and communicative as Charles Hoskinsons. The guy does more YouTube vids and AMAs than a lot of YouTubers! But perhaps more importantly IOHK have a monthly update. You just have to watch these vids to see how everything is progressing well and that a lot of the design of Cardano makes sense. I’ve actually found a of media misreport what is said, often claiming milestones that have not yet happened. This may be why outsiders to Cardano often complain about it being hype. I highly recommend listening to the Charles Hoskinson and IOHK YouTube updates instead.
Summary
Eth has the first mover advantage, but if all it took to succeed was to be first at something, we’d still have Netscape, Nokia, and AOL. To remain successful, you need to be offering a better product than your competitors, and right now the gas fees on Eth are crippling the network and making many dapps unusable for ordinary folks.
Cardano took the slow and steady approach to building a solid smart contract platform and has been meeting milestone after milestone. The most important and exciting milestone, Alonzo, the hard-fork event that will give us fully fledged smart contract capability is (very likely) out in then next 4-8 weeks. After which point the easiest part is over. The next few months is when we will see whether Cardano attracts the development community and can develop out an alternative dapp ecosystem to Ethereums. The Cardano 360 event later this month (date tba) will be the one you should all watch as a first taste of this.
Finally, I have a lot of admiration for eth, and I like the eth development community, and yes I may even watch those really mundane monthly eth developer calls on YouTube. I just don’t like it when your average Reddit fanatic overlooks some of the points I mention above. Bitcoin is a safe investment bet I’d say. Eth, Cardano and Dot still have a long way to go to gaining traction out there in the real world.
ReddSparks Crypto Blog 