Hi everyone, this is Charles Hoskinson broadcasting live from warm, sunny Colorado. I usually provide Cardano updates pretty frequently, like weekly or bi-weekly. As time has gone on, Cardano 360 and other media have kind of replaced my impromptu updates. However, I wanted to make a brief update for you all because there's actually a lot happening at the same time. I thought it was really important to separate the forest from the trees.
As many of you know, there’s been an enormous amount of work on SIP 1694, both internally and externally. Internally, there’s a very aggressive development effort underway. The node that SIP 1694 is being built on for testing is Node 8.0. Node 8.0 is out, and in fact, Node 8.1 is under construction and will be released in the next few weeks to pre-production for people to play around with and enjoy. A lot of progress has been made systematically going through the candidate spec that was decided in the workshop a little while ago here in Colorado, using it for testing and discussion purposes.
In parallel, there’s a large workshop effort occurring. This effort has expanded from one workshop in Colorado to now 43 community workshops across six different continents, if I recall the geographic distribution: Africa, South America, North America, Europe, Asia, and Australia. It’s pretty remarkable how widespread this is. Those workshops will solicit and gather enormous amounts of commentary and feedback, which will be funneled into a closing workshop in July in Edinburgh, Scotland. The goal of that workshop is to ingest all the comments from the 43 community workshops for SIP 1694 and to discuss the finalized design principles and parameters of SIP 1694, getting those into the final SIP. Once that final SIP is there, there will be a lot of work to finish the implementation, and then there will be a testnet that people can build against for community tooling.
There’s been a lot of work right now to figure out how to create an RFP program, a grant program for people interested in building community tooling for SIP 1694. That’s underway at the moment, and there will be some announcements about that in June and July. Many people will start working on that infrastructure, building dashboards and voting accountability tools for DRAPs. It’s almost like the Sunlight Foundation; it’s literally a government. There are a lot of things happening, and that work stream is progressing at blinding speed.
The hope is that throughout the summer, there will be deep and detailed conversations getting into the nuts and bolts. People will do exactly what they did with the incentivized testnet and the stake pool pioneers, where lots of people register as DRAPs and play around with that, submitting proposals to fork and submit proposals for changes. There are seven different governance actions one can take, so obviously, each of those has to be fully discussed and played around with.
Now, in tandem, there’s a lot of progress with the Edinburgh Decentralization Index. A new paper is coming out, I think they call it centralization, looking at metrics like the HHI, the Gini coefficient, and the Nakamoto coefficient. These metrics of decentralization and centralization have been proposed not only in the cryptocurrency space but also for historical regulation and antitrust, looking at the consolidation of an industry and decision-making within it. Those who attend the workshop in July, which will ingest all of the community workshops, will also see a presentation for the workshop attendees. The head of the Decentralization Index Lab at the University of Edinburgh will present their research on how they measure decentralization and the work the lab is doing.
The idea is that once things are where they need to be, and if we can get SIP 1694 online based on the community vote and the Cardano hard forks to adopt that, it would be really cool to have the lab measure Cardano and see where our decentralization sits in relation to Bitcoin and other major cryptocurrencies like Ethereum. My belief is that we’ll actually be substantially more decentralized than all cryptocurrencies on the market, which is one of the primary goals of these types of protocols.
Now, that’s the governance work stream. There’s a lot more to say about it, with tons of dedicated communications, blog posts, and other things. I just wanted to give people an idea of what the summer is going to look like. There’s an enormous amount of discussion, lots of workshops, and a ton of really great code being written. The next wave will be tons of great community tooling being developed, leading to an ITN-style experience where many people are playing around with these tools and getting familiar with them as a living organism forms—a decentralized government is forming on top of Cardano. There will be lots of debate; some people will love it, and some will hate it, but that’s the point of decentralization and consultation. What’s really been achieved is a truly global program for everybody to play with.
The retrofit onto Node 8 has been very straightforward in terms of progress, so things are moving along with high velocity. When we look at other parts of Cardano, other parts of the system, you have UTXO HD, Genesis, and the remaining work streams on peer-to-peer. Peer-to-peer is done from the perspective of peer sharing and the actual mechanics. There are some bugs, performance regressions, and weird configuration issues that organically work themselves out during updates and bug fixing. The last major feature there is eclipse detection for peer-to-peer, which is a summer project that will be rolled out and can be turned on.
Peer-to-peer really does require Genesis as well. Those two things together will give us a complete end-to-end network that behaves the way we envision. Genesis was published in 2018 as a very academic paper, and now there’s been a deep and detailed design effort going on for about a year to translate what was inspired by the paper into a practical protocol that can be plugged into what we have for Prowse. It’s a different chain selection role, so there’s going to be a handoff from the design team to the implementation team soon, running in parallel with the core team that is working on SIP 1694.
It’s the same for UTXO HD, which is a different way of storing things, allowing you to utilize persistent storage, like a hard disk, in addition to in-memory storage. These are both critical path items for the complete decentralization of the system, so they’re first-class citizens alongside SIP 1694. Then you have Plutus, where there’s still a lot of scoping for V3. There are many optimizations that still need to be done. The question is how much is semantic-level, meaning it’s a hard fork and a different version, versus tooling, like improving the compilers and the SDK.
The Plutus team is hard at work on those definitions, but one important thing is BLS signature support, as that opens up a lot of capabilities. There’s also an enormous amount of effort with Mithril and Hydra at the moment. Hydra continues to deliver very rapidly, and there seems to be some misunderstanding on Twitter and other places where people ask, “When is Hydra coming?” Hydra is running; it actually does work on the mainnet. There’s a vibrant community of developers using it as middleware and exploring it, from Obsidian to M Labs and others who intend to take Hydra to the next level.
The core team is speeding up, and Hydra technology continues to improve. It’s not like a light switch where something gets delivered, and then everything is magically great. It’s a spectrum, and the point of Hydra is to be software that integrates into people’s dApps to reduce on-chain load and operational costs while improving speed and finality. There are flavors of Hydra, like the tail protocol and head-to-head protocols, which are roadmap items with this rapidly advancing team. What’s wonderful is that Hydra is probably the best open-source program we have in the Cardano ecosystem at the moment, given the level of collaboration. The meetings regularly have more than 40 people from many different organizations, and the Cardano Foundation is even co-developing Hydra with dedicated developers alongside Obsidian and IO. It’s a very decentralized program already, and it’s gained a lot of community adoption.
We’re really proud of that team, and our goal is to ensure it continues to improve in velocity and gain more resources. Throughout the year, it will keep being built up and will gain more capabilities. If you go to hydro.family, you can see the website for it, and if you go to GitHub, you can see the entire roadmap and what’s planned in each of the releases. If you’re interested, please join the open calls that are done monthly.
A companion project is Mithril, and there’s always been a big debate about how we intend to use Mithril. Mithril is our in-house super lightweight proof certificate, and there’s been an enormous discussion about optimizing them and reducing certificate proof sizes. In fact, we managed to get Leo Raisin from Boston University to come out to the University of Edinburgh to spend the summer with us to talk about version two of it. The Mithril team has done great work, and it’s getting to a point where Mithril is getting mainnet ready for version one. Throughout the summer, that will become open—probably one to two more Pi cycles for it to be end-to-end ready and fully audited. This will then be exposed for wallets as the first use case; Lace will be one of the first to integrate. It’s an open system, and our hope is that the majority of wallets in the Cardano ecosystem take advantage of Hydra on the light wallet side.
On the full node side, there’s a discussion about using Mithril for parallel validation of epics, meaning you have a Mithril certificate for each epic, and you can sequentially validate them against and parallel validate each of those epics. This could potentially scale your validation times to the number of processing cores you have in the system, leading to much faster sync for full nodes. There’s a lot of discussion right now about where to take Mithril beyond just wallets, particularly in using Mithril with input endorsers. We’re currently writing papers along those lines, combining concepts from parallel chains, prior papers, the extended UTXO model, and Mithril certificates.
Watch for that throughout the summer. I think this is the best way of preserving decentralization while achieving high throughput within a system. The other side of Mithril is the combination of Mithril with more sophisticated and heavier cryptographic primitives, particularly recursive STARKs. They can be used together, and they would be most useful when discussing the sidechain model of Cardano, the entire sidechain ecosystem, and reducing the size of Mithril certificates for greater ubiquity.
There’s a lot of internal conversation about that right now, and there’s a large working project that’s a joint effort between the Midnight project and the Cardano project, specifically about the types of curves to use. We’re evaluating Pasta, Pluto, Eris, and others at the moment, trying to figure out how these things work together in the right way. This involves a significant amount of cryptographic engineering to get recursion working properly with SNARKs, so that team is going to be one of the fastest-growing. There’s a seven-figure commitment from our side to get things where they need to go, so there’s an enormous amount of good thought there.
That’s something in scope for this year in terms of the engineering effort, and the intention would be a post-SIP 1694 integration. There are still many open questions about how these heavy crypto primitives can be integrated, given that Plutus has a limited time budget per block. For example, BLS is pretty straightforward, but Pasta would not be. That’s where the challenge lies in accommodating heavier, more persistent event-oriented crypto primitives without necessitating field arithmetic conversions, which can be very expensive.
There’s a lot going on in that dimension. The last thing I’ll mention is the sidechain aspect. We’re making great progress on the sidechain side. Midnight is pushing this forward because it’s a sidechain. We have a great partnership with World Mobile, and they’re doing a lot of really cool and interesting things. Originally, the intention was to be a bit more of a polyglot for sidechains, meaning there would be basic primitives that would plug into known frameworks like Cosmos, Parity, Substrate, Scorex, Melcomeda, and others. However, it seems we’re likely to end up with a more opinionated approach that has batteries included, making it easier to create turnkey sidechains that include a lot of cool technology we’ve invented over the years.
I won’t spoil the announcement on that, but we have a pretty good idea, and sometime this summer, we’ll have a dedicated sidechains conversation tethered to a lot of discussion about Midnight. The team is doing an excellent job, and there’s a lot of new tech that can be brought to market, which I believe will make Cardano the best platform in the industry for sidechains. It’s that perfect connection of many great ideas we’ve had, but I don’t want to spoil it because there’s some exciting stuff coming.
Suffice it to say, I’m very happy with the direction. I think it’s pragmatic in that we’re doing new things and borrowing some great technologies that the industry has proven out. At the same time, there’s some brand new research that will greatly benefit the sidechain ecosystem, and bringing that in will be a great thing for everyone.
The DApp and DeFi side of Cardano continues to grow at an astounding rate. TVL keeps going up, the number of transactions keeps increasing, and the use cases for Cardano continue to improve. This year, we’re going to see a lot of cool projects start to mature, like Jed, for example, which is going to start growing significantly. It’s a great launch and just the beginning for algorithmic stablecoins. This is just the opening move in a long chess game to get the right algorithmic stablecoin, and it’s great to see Cody advance there.
It’s also great to see many other DApps and DeFi projects on Cardano starting to gain traction and make progress. There are still some frustrations and challenges here and there, but overall, it’s important to understand that this is not a copy-paste of Ethereum. It’s a completely different computational model and accounting model, so you can’t reuse Ethereum’s code here. That’s why many of the DApps and DeFi projects on Cardano are so novel, interesting, and innovative; they’ve had to redesign and rethink their protocols from the perspective of extended UTXO and Plutus.
They’re pre-set up to start adopting technologies as they become available, like Hydra, for example. It’s exciting to see these developments and how things are progressing. Cardano 360 will continue on a monthly basis, with a lot of updates about the Cardano MBO and governance. It’s the summer of governance!
Not to be outdone, all the other operating groups are moving along at an astounding pace. Great infrastructure is being made available. Lace is just about to hit version 2.1.2, including, I believe, Brave support. I’m a Brave user, so I’m pretty happy about that. Full open sourcing should occur probably at the end of the month. We were waiting for some last-minute things on the audit and some licensing issues to clear up, but we should be able to get all that under Apache 2 and released by the end of the month.
It still astounds me the lack of faith and criticism that sometimes arises. For example, when we announce we’re going to open source something soon, people act as if that’s never going to happen and that there’s some blatant dishonesty behind it. But that’s the nature of the industry. Everyone seems quick to criticize and slow to apologize, and the minute you achieve something great, they move on to the next thing to criticize.
You really have to separate the noise from the progress. The reality is that when you widen the aperture and look at the totality of the Cardano project, we’ve done something that no other project has done. We invented all of our protocols from scratch, wrote millions of lines of code, brought millions of people together, and created an organism that continues to get stronger month after month. By every metric, we continue to become more decentralized and grow in impact and evangelism.
There’s quite a diversity of thought, and we’re reaching a point where this organism is becoming self-governing and recursive in its ability to improve itself. If one were to disappear for 25 years and come back, it wouldn’t just be better; it would be exponentially better. That’s extraordinary, and it’s due to the hard work, character, and integrity of the people involved. While sometimes things take longer than we’d like or we have to go back to the drawing board and reinvent or change some things, we never gave up. That’s what I’m most proud of—the relentlessness of the people involved in Cardano.
When we step away from the daily complaints and look at the monthly, quarterly, and yearly progress, it’s extraordinary. It’s also remarkable to see that we’re always open to new ideas. The core of Cardano is starting to ossify from the perspective of certain design decisions, which are really benefiting us. We’re learning how to utilize them, like the desire for determinism in the transaction model and the local ability to compute resource consumption. That’s great, but on the peripheries, we have a vibrant, diverse set of opinions.
For example, the programming language side has projects like Aiken, which is radically different from Plutus. People are trying to bring TypeScript into Cardano. There are sidechains that will emerge, like flowers blooming over the next 24 to 36 months. We’re also starting to see the first wave of identity-enabled applications via the Prism framework, which has recently been upgraded to version two. Many people are using that to bring identity into the cryptocurrency space the right way, in a self-sovereign manner.
Criticism will always be there, but in the long run, I think we’re going to win because we are winning together, as opposed to a particular company, agenda, or person. There’s no greater example of that than when we have our moment to measure Cardano’s decentralization against the rest of the cryptocurrency space. I think it’s going to be a wake-up call for all of them. While Bitcoin maximalists and others may ignore this and dismiss it as random or academic waste, the reality is that these metrics will likely work their way into regulatory standards. When people start discussing what it means to be sufficiently decentralized and what regulations should apply to cryptocurrencies based on their level of decentralization, those that are more decentralized will be treated like commodities and protocols like TCP, while those that are more centralized will be treated unfavorably from that perspective. I can see that happening with MiCA and future regulations.
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