Cardano faces scalability issues after upgrade

THE Cardano has been one of the cryptomarket’s big surprises in recent months, however the digital currency blockchain is experiencing issues with its scalability after the latest update, raising concerns about the asset’s future.

Input Output, developer of Cardano, launched the Platus smart contracts update on testnet of Cardano. However, the feedback has not been very positive or favorable.

Minswap, first DEX to use the new feature said it encountered serious scalability issues, questioning Cardano’s ability to run smart contracts.

Frustration

Upgrading to smart contracts is something that the community is eagerly awaiting, even generating criticism for broken promises by the project developer.

Minswap’s situation was reported on Twitter, demonstrating frustration with the experience and the fact that it could not have taken the test long enough. However, Minswap said it had enough data to be able to come up with proposals to improve its DEX.

“Unfortunately we had to stop our testnet temporarily.

We’ve gathered enough data from our testers to improve our DEX fundamentals.

In the next few days we will publish the post-mortem, our scalability solutions and when the testnet will be open again.”

Snowball

The Cardano ecosystem uses the same transaction computing model as Bitcoin, UTXO, or Extended UTXO. Other blockchains such as Ethereum and Solana use account-based contracts, which allow multiple users to interact with one smart contract.

It is possible to solve the situation with dapp sequencers to solve the problems, however, this is not the ideal way to run smart contracts in a blockchain.

One of Cardano’s main critics, Eric Wall of Arcane Assets warned that the sequencer solution can extract Miner Extractable Value (MEV) by selecting a transaction and censoring others.

In addition, the miner/validator at Cardano’s base tier can look at the sequencers’ batch of transactions, reject part or all of the batch, and determine which transactions they want to allow in the block.

While not such a troubling technical glitch or even easy to understand for the end user, it’s a kind of problem that can snowball, starting small now and bottlenecking the scalability of Cardano’s smart contracts in the future.