What to expect from Cardano's Vasil Hard Fork

Lars Brünjes, one of Cardano's leading developers, talked about the upcoming hard fork, "Vasil." He explains which improvements will result from the network upgrade.

Cardano ADA coins
(Pic by Andreas Prott on Adobe Stock)

Lars Brünjes holds a Ph.D. in mathematics, teaches courses on the Haskell programming language worldwide, and has been following Cardano from an early age as a developer at IO Global for over five years. The initial vision turned into a global network that has grown into one of the largest Smart Contract platforms.

The Cardano native token ADA consistently ranks among the top 10 cryptocurrencies. With the upcoming hard fork "Vasil," Cardano is getting another upgrade that should significantly increase its performance. We wanted to know from Lars Brünjes: What are the concrete improvements, how does the scaling solution "Hydra" actually work, and where does Cardano stand out from Ethereum?

What to expect from the Vasil upgrade?

Smart Contracts will become more efficient and cheaper, i.e., they will need less memory and thus fewer transaction fees. With the upgrade, there is a change called Reference Inputs that allows certain classes of applications to transact much more simultaneously in one block than you could before.

It will be more powerful, perform better, faster, and lower storage space and transaction costs. For users, it will mainly be quicker and more affordable. For developers, there will be more opportunities to write even more powerful Cardano Smart Contracts that do more.

Hydra: The Layer 2 solution from Cardano

With the Hydra, Cardano's Layer 2 solution, you don't do transactions on the blockchain but off-chain. The mechanism is, in principle, quasi-free and as fast as you want. You exchange transactions independently of the blockchain, which is much faster and effectively free, but you can still use the blockchain to secure the transactions.

Bitcoin Lightning works similarly. You use features with time locks and half-signed transactions. Hydra has the same effect that you don't have to use the blockchain to do certain transactions, which is much faster and accessible but still has the security provided by the blockchain. However, Hydra has certain theoretical and practical advantages compared to Bitcoin Lightning.

The Smart Contracts you write for Hydra don't even need to know that they are running on Hydra. So it's a Hydra off-chain network. The part of the blockchain that Hydra handles looks precisely like the actual blockchain from the stakeholders' perspective. You don't have to customize code to run anything on Hydra specifically. That means it's much easier than taking existing stuff and running it on Hydra.

Cardano vs. Ethereum

Cardano has been developed from the beginning to be better than Ethereum and not to repeat the mistakes, especially not only those of Ethereum but also of Bitcoin. A big problem with Bitcoin and Ethereum is that they use Proof of Work (PoW), which is problematic, especially concerning climate change. Cardano was the first blockchain in the world where there was a mathematical proof that Proof of Stake (PoS) works.

Many people doubted the feasibility of PoS. Some even PoS was not valid as a consensus algorithm. Cardano showed that it is possible and is much more scalable and energy-efficient than Bitcoin and Ethereum, at least until the implementation of ETH2. Of course, it has environmental and very concrete financial consequences.

Transaction costs

The fact that the transaction fees on Ethereum are so high is ultimate because Proof of Work is so expensive. Ethereum's infrastructure for Smart contracts is bold and widely used. Solidity is the most commonly used programming language for Smart Contract development, but it quickly becomes costly. That's why Cardano developers made their blockchain so that the transaction fees are significantly lower.

They also provide two environments from Smart Contract Development. Based on Haskell, the Plutus programming language inherits many characteristics of its parent language, including its functional soul and secure development even at compilation time.

On the other hand, you can use a more straightforward alternative, at least apparently, named Marlowe. It is a Domain-Specific language that uses a graphical approach for programming.

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