Why The Cardano Alonzo Purple Update Caused a Surge in ADA

Alonzo Purple is the newest upgrade to the Cardano blockchain, finally on its way to pass the crypto’s peer-reviewed delay.

Passing $2

With the launch of the Alonzo Purple Smart Contract Public Testnet, Cardano’s value is on the rise, with the coin passing the $2 mark for the first time in months. Nearing another all-time high, you can say that a lot rides of the Alonzo Purple upgrade, especially considering its 60% rise from one-week lows.

For those of you not too familiar with Cardano or its Alonzo Purple upgrade, it’s best we start with the actual technology, Cardano. Cardano, trading as ADA, is a third generation blockchain, posed as a competitor to first-generation Bitcoin and second-generation Ethereum. The project aims to compete directly against Ethereum specifically, another program which happens to have been co-founded by Charles Hoskinson, the founder of Cardano.

The reason this inclusion of Alonzo Purple is so important, is due to Cardano’s peer-reviewed methods. The entire project runs from the research and technology brought about by dozens of respected scientists, unlike Ethereum. Well, not exactly, but Ethereum likes to throw stuff at the wall and see what fits. Cardano, on the other hand, likes to meticulously craft a new update, test it, peer-review it, then review a test, then final version to the public.

Cardano Must Be Really Well Peer-Reviewed 

With that approach, Cardano has had much less of an impact than Ethereum in its four-year life, although it has a much higher reputation. The Cardano platform has never been hacked and is thought to be potentially unbreachable, thanks to its widespread permissions and lack of a single platform to control the entire coin.

Ethereum is booked as “risky” by Hoskinson, while Cardano has been called slow and ineffective by Ethereum co-founder Vitalik Buterin. Well, at least until Alonzo Purple was announced.

Alonzo Purple is planned to be the biggest update to the Cardano platform, bringing much of what is already available on Ethereum, and a bit more. If it proves as successful as it’s intended to be, then Cardano may not only catch up to Ethereum, even after a multi-year second-place but also leapfrog the project. That’s a lot riding from a single update, although the hype, promises, and 60%+ gains might prove to be not too far off from reality.

Alonzo Purple

For those of you not too familiar with Alonzo Purple (i.e., likely 95% of the people reading this), here’s a quick little synopsis:

Purple is the third Alonzo rollout, Cardano’s big plan for becoming the number 1 decentralized platform. Previously, there was the launch of Alonzo Blue in June/July and Alonzo White in July/August. Now, we have the upcoming Alonzo Purple launch, which was rumored to have been announced soon.

If it doesn’t tell you how much people are excited about this, the rumor of an announcement of an announcement led to a 16% increase in ADA’s value and price. Yes, the rumor of an announcement of an announcement of a future project led to a multi-billion dollar increase in valuation.

It might turn out to be worth it, with Alonzo Purple’s expectations including:

  • Smart contracts
  • The ability the run DeFi (decentralized finance) apps off the Cardano network
  • Potentially the addition of ERC-20 tokens on the Cardano blockchain
  • And honestly, that’s about it…
Still More than Good Enough

But the top two are more than large enough to cause a spike in value. If you’re not sure what a smart contract is, welcome to the club! I’m not too confident in exactly what they are either, but here’s what I understand about the technology:

A smart contract is a program stored on the blockchain (i.e., viewable to all and permanently burned into the chain), which will run when conditions line up. From what I understand, this would mean that a situation or contract could be immediately triggered when both sides meet the criteria.

While that doesn’t sound too exciting, it’s really cool. Here’s an example:

Jimmy wants Sarah’s NFT token, so he builds a smart contract into the Cardano blockchain. According to the contract, if Jimmy pays 25 ADA into the contract and Sarah uploads her NFT ownership to the platform, then both sides would get the other’s item. If Jimmy built in his payment at the beginning, it could rest there until Sarah puts her NFT onto the contract and vice versa.

Adding Smart Contracts was Smart

Of course, that’s not the only possibility, with potential for literally anything that runs from an if/when/then situation. You could set up concrete payments for services, pass ownership for assets, pay people when their information is provided, and much more.

Smart contracts are incredibly, even if I’m terrible at explaining them. According to IBM, they’re great for speed, efficiency, accuracy, trust, transparency, security, and saving money from D2C payments. It’s honestly a great way to establish Cardano as a trustable currency or intermediary (without being a middleman) between transactions, which is great.

With this added benefit and the addition of a DeFi program, Cardano immediately catches up to Ethereum in terms of usability and features. Plus, Cardano also has minuscule payment fees, a PoS consensus mechanism, and 1 thousand TPS, per “Hydra head.” That puts Cardano’s DeFi potential at upwards of 1 million TPS, while Ethereum 1.0 contains 10 and Ethereum 2.0 is rumored to have 100,000 TPS.

Alonzo Purple’s potential is great, not only for Cardano itself but also for the decentralized community. The benefits that Cardano and its coin ADA gain from smart contracts and DeFi acceptability alone, outweigh the negatives of Cardano’s slow development time, although that’s missing something important. Oh yeah, the upgrade releases on September 12th.

Why The Cardano Alonzo Purple Update Caused a Surge in ADA

Alonzo Purple is the newest upgrade to the Cardano blockchain, finally on its way to pass the crypto’s peer-reviewed delay.

Passing $2

With the launch of the Alonzo Purple Smart Contract Public Testnet, Cardano’s value is on the rise, with the coin passing the $2 mark for the first time in months. Nearing another all-time high, you can say that a lot rides of the Alonzo Purple upgrade, especially considering its 60% rise from one-week lows.

For those of you not too familiar with Cardano or its Alonzo Purple upgrade, it’s best we start with the actual technology, Cardano. Cardano, trading as ADA, is a third generation blockchain, posed as a competitor to first-generation Bitcoin and second-generation Ethereum. The project aims to compete directly against Ethereum specifically, another program which happens to have been co-founded by Charles Hoskinson, the founder of Cardano.

The reason this inclusion of Alonzo Purple is so important, is due to Cardano’s peer-reviewed methods. The entire project runs from the research and technology brought about by dozens of respected scientists, unlike Ethereum. Well, not exactly, but Ethereum likes to throw stuff at the wall and see what fits. Cardano, on the other hand, likes to meticulously craft a new update, test it, peer-review it, then review a test, then final version to the public.

Cardano Must Be Really Well Peer-Reviewed 

With that approach, Cardano has had much less of an impact than Ethereum in its four-year life, although it has a much higher reputation. The Cardano platform has never been hacked and is thought to be potentially unbreachable, thanks to its widespread permissions and lack of a single platform to control the entire coin.

Ethereum is booked as “risky” by Hoskinson, while Cardano has been called slow and ineffective by Ethereum co-founder Vitalik Buterin. Well, at least until Alonzo Purple was announced.

Alonzo Purple is planned to be the biggest update to the Cardano platform, bringing much of what is already available on Ethereum, and a bit more. If it proves as successful as it’s intended to be, then Cardano may not only catch up to Ethereum, even after a multi-year second-place but also leapfrog the project. That’s a lot riding from a single update, although the hype, promises, and 60%+ gains might prove to be not too far off from reality.

Alonzo Purple

For those of you not too familiar with Alonzo Purple (i.e., likely 95% of the people reading this), here’s a quick little synopsis:

Purple is the third Alonzo rollout, Cardano’s big plan for becoming the number 1 decentralized platform. Previously, there was the launch of Alonzo Blue in June/July and Alonzo White in July/August. Now, we have the upcoming Alonzo Purple launch, which was rumored to have been announced soon.

If it doesn’t tell you how much people are excited about this, the rumor of an announcement of an announcement led to a 16% increase in ADA’s value and price. Yes, the rumor of an announcement of an announcement of a future project led to a multi-billion dollar increase in valuation.

It might turn out to be worth it, with Alonzo Purple’s expectations including:

  • Smart contracts
  • The ability the run DeFi (decentralized finance) apps off the Cardano network
  • Potentially the addition of ERC-20 tokens on the Cardano blockchain
  • And honestly, that’s about it…
Still More than Good Enough

But the top two are more than large enough to cause a spike in value. If you’re not sure what a smart contract is, welcome to the club! I’m not too confident in exactly what they are either, but here’s what I understand about the technology:

A smart contract is a program stored on the blockchain (i.e., viewable to all and permanently burned into the chain), which will run when conditions line up. From what I understand, this would mean that a situation or contract could be immediately triggered when both sides meet the criteria.

While that doesn’t sound too exciting, it’s really cool. Here’s an example:

Jimmy wants Sarah’s NFT token, so he builds a smart contract into the Cardano blockchain. According to the contract, if Jimmy pays 25 ADA into the contract and Sarah uploads her NFT ownership to the platform, then both sides would get the other’s item. If Jimmy built in his payment at the beginning, it could rest there until Sarah puts her NFT onto the contract and vice versa.

Adding Smart Contracts was Smart

Of course, that’s not the only possibility, with potential for literally anything that runs from an if/when/then situation. You could set up concrete payments for services, pass ownership for assets, pay people when their information is provided, and much more.

Smart contracts are incredibly, even if I’m terrible at explaining them. According to IBM, they’re great for speed, efficiency, accuracy, trust, transparency, security, and saving money from D2C payments. It’s honestly a great way to establish Cardano as a trustable currency or intermediary (without being a middleman) between transactions, which is great.

With this added benefit and the addition of a DeFi program, Cardano immediately catches up to Ethereum in terms of usability and features. Plus, Cardano also has minuscule payment fees, a PoS consensus mechanism, and 1 thousand TPS, per “Hydra head.” That puts Cardano’s DeFi potential at upwards of 1 million TPS, while Ethereum 1.0 contains 10 and Ethereum 2.0 is rumored to have 100,000 TPS.

Alonzo Purple’s potential is great, not only for Cardano itself but also for the decentralized community. The benefits that Cardano and its coin ADA gain from smart contracts and DeFi acceptability alone, outweigh the negatives of Cardano’s slow development time, although that’s missing something important. Oh yeah, the upgrade releases on September 12th.