In the wake of Ethereum’s successful transition to Proof-of-Stake last week, Cardano, the third largest smart contract platform by market capitalization, is set to go through a much anticipated upgrade today, September 22, the Vasil hard fork.
Figure 1: IOHK Blog, Vasil: what to expect, accessed September 22, 2022.
Vasil implements a suite of improvements to the Cardano blockchain, enriching its smart contract capabilities, increasing the chain’s throughput, and reducing transaction costs, further improving Cardano’s scalability. This is possible due to the activation of a mechanism that simplifies the assignment of Proof-of-Stake operators to block production, resulting in faster block validation and overall network syncing times without compromising security, together with diffusion pipelining, which improves block propagation times by streamlining the process of sharing information among network participants. Plutus, Cardano’s scripting language, will also have its version 2 fully deployed, with new built-in functionalities that will reduce overall computational resources needed to execute code on the network.
One of the main investment cases for crypto are smart contract platforms, without which applications in the realms of decentralized finance and NFTs couldn’t exist. We believe this upgrade is a demonstration of the continued effort of alternative platforms to improve their infrastructure and move forward in their roadmaps, intensifying the competition among the major players in this space. After the past couple of years, with the rise of several Ethereum competitors, it’s still disputable whether the future will be single-chain or multi-chain. Nonetheless, this kind of development reassures the importance of having a diversified exposure in crypto that takes into account the nuances of the smart contract sector, enabling investors to better take advantage of the growth in all ecosystems of decentralized applications.
For a detailed introduction to the underlying technology behind smart contracts and the investment case for this sector of the crypto industry, consider reading our Smart Contracts Primer.
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