One of the newer blockchain project that rode the 2017 ICO wave, raising half a billion dollars worth at the time, has now finally launched delegated Proof of Stake (PoS) through an incentivized testnet.
Some 2.6 billion of Cardano’s currency, ADA, has already staked through 300 stake-pools with the aim of reaching 1,000 such pools.
That makes it around 10% of circulating supply of 25 billion, with suggestions one billion of it belongs to Input Output Hong Kong (IOHK), the company responsible for coming up with Cardano.
“Delegating 100,000 ADA, worth just under $3,600 at press time, would earn the user around 7.1 percent, or around $257, annually,” we’re told, with a reward calculator already out.
“This short, ‘incentivized testnet’ phase of the Shelley era will allow us to test the performance of the rewards mechanisms and to help us build a stable and qualified group of stake pool operators, to support the operation and ongoing development of the decentralized Cardano network,” Charles Hoskinson, Cardano’s founder, said.
This will be followed by the launch of smart contracts and sidechains in 2020. Sidechains here being kind of like shards.
Whether they will be able to meet that target remains to be seen, but in October Hoskinson promised to eat a shoe made of cake for missing the deadline.
He insisted this incentivized testnet is the launch of the Proof of Stake stage they call Shelly, but was still happy to defer to critics.
Ethereum too was planning to follow the same timeline with the target date for the Proof of Stake Beacon chain launch initially being on January 3rd.
There was a complete redesign, however, during Devcon so Q2 of 2020 is perhaps the optimistic estimate now with some suggesting Q3.
The ethereum Proof of Stake is however a bit different because it is designed to disincentivize pool staking, but it is probable most people will still just give it to Coinbase or some custodian to stake it for them.
The more important point is obviously the sharding or the sidechains or the red and blue teams as they call them in Avalanche.
The latter has a significantly different design, but when it comes to eth or ada or other new or old blockchains, the considerable difficulty of the task is in ensuring you can have such different small networks while connecting them into a whole network and still need no trust in the entire network while running just part of it.
That requires a considerable breakthrough because it is kind of like having a computer where you can do things – today’s blockchains – and having internet on that computer – sharding.
In bitcoin land it’s not clear how hard they tried but they proposed sidechains all the way back in 2014. The only thing they could come up with so far is a somewhat centralized peg.
Peg here being the “connection” between the two networks. They tried and tried to find a decentralized way, but they haven’t been able to so far.
What Cardano’s design will be remains to be seen, and same for eth, while in Polkadot they place much of the burden on the Relay, which is sort of their version of the Beacon.
To bitcoiners that would be too centralized, but bitcoin lacks a user friendly programming language, more commonly called smart contracts.
So there could potentially be ways of connecting these networks, especially as a lot of money has been thrown towards this space and thus the resources are there, but just who will solve scalability remains to be seen.