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Cardano Founder Highlights Best Part of Cardano's eUTxO Architecture

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Sun, 05/08/2022 - 16:00
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Tomiwabold Olajide
Cardano uses an innovative Extended Unspent Transaction Output (EUTXO) model
Cardano Founder Highlights Best Part of Cardano's eUTxO Architecture
Cover image via stock.adobe.com

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Cardano founder Charles Hoskinson, in a recent tweet, highlights the best part of Cardano's EUXTO model: superior knowledge of functional programming.

Cardano, similarly to Bitcoin, is an Unspent Transaction Output (UTXO)-based blockchain, which uses a different accounting model for its ledger from other account-based blockchains, such as Ethereum. Cardano, on the other hand, uses an innovative Extended Unspent Transaction Output (EUTXO) model, which was introduced by the Alonzo upgrade to support multi-assets and smart contracts.

This comes amid critical remarks made by the founder and CIO of CyberCapital, Justin Bonus, who cited that Cardano has made major trade-offs by relying on a UTXO model instead of an account model.

The CyberCapital CIO had cited limited interoperability between smart contracts as part of the "fundamental flaws" of EUXTO architecture. He says that while this may restrict the types of contracts that can be built on Cardano, "The trade-off for the loss in concurrency is parallelism which gives scalability advantages."

This is the case because EUTXO expands the UTXO model by allowing output addresses to incorporate complex logic to determine which transactions can unlock them. And by adding custom data to all outputs, a significant degree of parallelism is feasible due to the "local" nature of transaction validation.

The EUTXO paradigm appears to have more advantages, such as increased security and predictability in smart contract execution costs, and more powerful parallelization.

Cardano flips Terra to rank 8th largest

According to CoinMarketCap data, Cardano has flipped Terra (LUNA) to rank 8th largest in terms of market capitalization. With a present market valuation of $25.27 billion, Cardano now ranks ahead of Terra, whose present market capitalization is $21.85 billion.

As U.Today previously reported, Cardano pulled in a surprise recovery on May 4 before the latest price retreat. On-chain data indicates an accumulation spree among whales and a spike in retail interest.

IntoTheBlock recently reported that balances held by traders, which refer to addresses holding for less than 30 days, have surged by about 186% in the last 30 days or so. These addresses now own 36.14% of the ADA supply in total.

Cardano (ADA) trades down 4.60% at $0.746 at the time of publication.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.