Since 2017, there has been a significant increase in active blockchains within the Decentralized Finance (DeFi), market. We also saw the launch of and during this period, which were both highly popular with developers, investors and end-users.

The debate has been ongoing about which blockchain is better for the future, and whether or not the technology that underlies them is strong enough to ensure a stable future.

While this topic remains controversial among blockchain enthusiasts. This article will provide a deeper dive into both the blockchains to help highlight their strengths and drawbacks.

It will focus on three main metrics that are common to both blockchains: first, technology and consensus mechanism. Second, systems of governance. Finally, market token performance.

Technology

Cardano (the earliest blockchain entry) is a third-generation Proof-of-Stake platform. This is designed to replace Proof-of-Work network (PoW).

Polkadot is also a Proof of Stake protocol that aims to enable interoperability across blockchains. You can see that it connects both permissioned blockchains and oracles.

Polkadot’s relay chain is what makes Polkadot work. It allows for interoperability with other side or network chains. Notably, Polkadot is unique in that it not only hosts decentralized applications but also allows developers to design their own private blockchains while still benefiting from the base layer’s security.

Cardano’s platform is built using a unique technology, which represents a major improvement on traditional PoS methods used by many scaling blockchains. In more detail, Cardano operates on the ‘Ouroboros consensus protocol,’ a product of the research made by Cardano during their ‘Foundational’ phase.

This protocol was developed using research-based approaches that have proven very reliable.

Cardano, the largest blockchain project that has received the greatest amount of research to date (over 90 publications covering a broad range of topics) is the Cardano development group. The foundational team’s extensive research is the core of Cardano.

Scalability

A major issue most blockchains of the new generation are trying to resolve is scalability. This refers in part to the ability for a blockchain, or any blockchain, to reach high throughput without having to compromise its decentralized attribute.

Polkadot and Cardano can both scale by using a hybrid chaining method. Cardano is one of these coins. It does this by dividing its blockchain into two main layers, the Cardano Settlement Layer, (OTC :)),, and the Cardano COmputational Layer, (CCL).

The former is used to record ADA (the network’s native asset) transactions, while CCL contains smart contracts which can then be integrated by developers to stay active on the blockchain.

Polkadot also runs two kinds of blockchain: one known as the relay, discussed previously, and another called parachains. Both are stored on the mainnet through smart contracts.

Although the relay chain records the final transactions across parachains, they can also be customized by users on their own chains.

Unfortunately, Cardano’s network can still not achieve the same level of scaleability as Polkadot. It still registers a low throughput rate of between 20 and 250 transactions per second (TPS). However, Polkadot processes at an incredible 1000 TPS because it leverages its parachain structure.

Cardano, aware of its present setback, is working on an enhanced version 2 that is tentatively being called “Hydra.” According to Harold B., a project team member, the forthcoming upgrade will solve the major limitations, currently being faced, that may impede the network’s adoption rate.

Hydra’s upgrade aims at addressing the low throughput problem by creating a more efficient consensus mechanism. Additionally, the upgrade will address broad, pressing problems in blockchain technology, including concurrency as well as parallelism.

Token Performance

Cardano prices have risen tremendously since 2021. This is in spite of Cardano’s 98% decline from $1.345 (January 3rd 2018), which was its highest point. It fell to $0.018 after the 800-day period.

On the 13th march 2020, an impulsive action of the highest order began developing. It reached its record high of $3.18, on the third of September 2018, which was an improvement of 16,848%.

On the other hand, Polkadot’s native asset, DOT, started off in a narrow range last year, from August until December, hovering at around $5.18. This can be seen as an accumulation stage. From this point, we began to see the beginnings of a bull market, with the first bull cycles starting on December 28th.

The price reached $49.74 on May 15, which was an unprecedented high. This marked an increase of 927%. On the 20th July, it fell to $10.68. This was a 79% decrease.

That said, Cardano’s ADA is performing relatively poorly for a token that was released four years earlier than its competitor. The Cardano blockchain has very few transactions, which is the best explanation for the low ADA token prices.

Cardano supports smart contracts fully, but some technology needed for dApps (or web-based apps) isn’t available on the network. There are many dApps awaiting to launch on the network. Only a few apps currently work on it. The low price of the utility token makes sense when compared with its expected arrival time in the market.

Polkadot on the other has seen significant growth in just two years after its May 2020 launch. The blockchain network currently hosts over 350 projects that were built using Polkadot. Many more are expected to follow in the future. The rate at which DOT adoption is increasing, it’s expected that the cost of DOT will skyrocket.

Ultimately, the sky’s the limit for both Cardano and Polkadot, but whether they will be able to withstand the test of time is largely dependent on widespread acceptance within the industry.

To The Flipside

• Cardano, as well Polkadot both are new and are being constantly improved. Adoption rates can vary depending upon how fast they are able to overcome new barriers.
• Cardano’s and Polkadot’s general-purpose scaling blockchain networks are highly competitive and claim to provide real solutions, but they don’t offer any genuine alternatives.

What are the reasons to care?

Both are relatively young projects. Building services or applications on Polkadot or Cardano at genesis gives you early access to long-term benefits like corresponding utility token performance.

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