Cardano network congestion is bad for token price

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The price of the native token of the Cardano blockchain (ADA) has fallen by 10% over the past 30 days. At the time of this writing, the token in the ADA / USDT pair is trading at $ 2.14, which is about 11% lower than on September 18, when the price was $ 2.4.

Trading volumes over the same period plummeted nearly 50% to $ 109.4 billion, according to Nomics. ADA price activity is dropping amid reports that Cardano’s network bandwidth peaked shortly after the addition of smart contract support.

As noted by a Github user under the nickname SebastienGllmt, the load on the Cardano network on September 25 was 100%. This is likely due to a sharp increase in the generation of non-fungible tokens through the ecosystem’s smart contracts. At the time of this writing, the occupancy rate for the last hour, according to pool.im, is 12%.

Source: pool.pm

However, the saved copy of the site from September 29 shows that the load on the network did sometimes approach the maximum values. According to one of the screenshots, at the moment the overload was 67%.

At its peak, the network can handle ~ 0.2 to 6.5 transactions per second (tps), according to SebastienGllmt. For the Ethereum network, the same indicator, for example, is ~ 10-15 tps. At the same time, it takes about 20 seconds to generate a block in the Cardano network. Ethereum takes ~ 13 seconds to do this.

Ethereum clone

Overloading Cardano can lead to an error in the execution of transactions, notes SebastienGllmt. At the same time, it is impossible to increase the block size, as, for example, the bitcoin community once did. Plutus (the platform on which smart contracts for Cardano are deployed) is still optimizing, and increasing the block size could make the contracts take too long to run.

Several users on a Reddit thread have already stated that they are disappointed with Cardano’s progress. One of the users, for example, admitted that he invested in ADA because of the general hype:

“I have to admit I was in the cardano cult for a while,” he said. [стилистика сохранена].

Now, according to him, he no longer stores ADA and regrets that he chose dollars, not bitcoin, when selling.

The only way to solve this problem, according to SebastienGllmt, is to follow the Ethereum path again. The solution involves the creation of a commissioned transaction market to combat extreme network usage.

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