- Cardano ousts Ethereum in transaction volume and cheaper fees amidst growing network activity.
- The launch of Sundaeswap, Cardano’s first DEX, has been a key driver.
- However, the price of ADA has not escaped the market crash.
Cardano (ADA), the biggest proof-of-stake (PoS) blockchain network, is continually outperforming Ethereum (ETH) in transaction volume. Over the past 24 hours, the adjusted volume of transactions processed on Cardano was around $6.5 billion, surpassing Ethereum’s $5.8 billion processed according to data from Messari’s most active chains dashboard.
Added to that, Cardano has offered a better fees proposition than the second-largest blockchain network Ethereum. Transaction fees on Cardano in the time frame have been a spectacularly low $76,500, while transaction fees on Ethereum reached $38.6 million. In contrast, Cardano’s transaction fees were about 568x lower than that of Ethereum. Fees on Ethereum surpassed even those on the Bitcoin blockchain which remains the leader in transaction volumes.
Cardano proponents have pointed to this gaping difference in fees and Cardano’s dominance in transaction volume as a reason to be bullish on Cardano while Hoskinson reiterates Cardano’s impressive trajectory, asserting “And remember, we are just getting started with Basho….”.
Cardano’s transaction volume: a blessing and a curse
The high transaction volume on Cardano has been due to growing network activity. The Cardano blockchain welcomed its first decentralized application (DApp) in the form of Sundaeswap, an automatic market maker (AMM) decentralized exchange. The platform went live at 10.45 UTC yesterday. While the event was highly anticipated and is being celebrated, it is also putting the Cardano blockchain through one of its toughest tests yet.
The operation of the DEX has been less than smooth as the Cardano network is suffering serious congestion. At the time of writing, network load on the Cardano network is around 89% according to data from Adapools.org, a Cardano network tracking tool. The heavy load has caused users to complain of failed transactions as well as successful transactions taking longer to process on Sundaeswap.
Recall that this outcome was anticipated by both developers at Sundaeswap and IOHK. Sundaeswap previously told its community to expect congestion in the first few days after launch. Sundaeswap wrote:
“…We want to inform you all that while orders (including swapping, providing liquidity, and withdrawing liquidity) may take days to process, everybody’s orders will be processed fairly and in the order they were received and executable.”
IOHK has also released an 11 point roadmap it will focus on through 2022 to bring more scalability to the blockchain. One of the first scaling actions it will take this year will be the release of a new version of the Cardano node that is expected to improve network performance.
ADA Tanks With The Broader Market
The excitement around the launch of Sundaeswap has not spared the price of ADA from following the crypto market trend. On the day, ADA is about -10% down, trading at around $1.20. This has been a reversal of the price pump ADA was experiencing in the past few days.
The drop in the price of ADA can however be tied to the crypto market crash that has seen Bitcoin drop below $39,000 and Ethereum drop under $3,000. Cardano proponents however remain optimistic about the price of ADA.