The recent Alonzo upgrade galvanized the Cardano community. The hard fork introduced smart contract capabilities to the blockchain sparking the creation of 62 dApps and counting. Unsurprisingly, DeFi protocols and NFT platforms are experiencing notable demand.
IOHK recently led an international summit to foster community engagement following the influx of excitement. The event consisted of in-person meetups in New York, London, Berlin, and other major cities where conditions permitted. Elsewhere, IOHK hosted an active virtual meetup alongside partner Terra Virtua that was flushed with NFT Easter eggs. Naturally, the summit included several impactful keynote addresses and eye-popping announcements.
Arguably the most significant announcement surrounded a partnership between the Cardano and Chainlink communities. Chainlink is a decentralized oracle network capable of providing price feeds and other data streams to decentralized projects.
Head of Blockchain Partnerships at Chainlink Labs Niki Ariyasinghe described the vision behind the collaboration:
“Our vision is one of wanting to make a wider impact on society with what we call ‘The Truth,’ and providing ‘The Truth’ in a cryptographically secure way. We want to extend what smart contracts can do across a whole range of industries.”
“The type of integration we are trying to build here is something that will enable hundreds of billions of dollars of TVL to be secured on the Cardano ecosystem, particularly in the DeFi space.”
The TVL, or total value locked, of a dApp is a standard metric of application usability and adoption.
The Plutus dAppStore
As smart contract dApps emerge across the Cardano ecosystem, issues will naturally arise around quality and discovery. Taking a beat from app developers, IOHK recently announced the Plutus dAppStore. The digital storefront was also demoed during the summit:
The online outlet will support all dApps running in the Cardano ecosystem. However, the platform will provide users with quality assurance by certifying applications that have met code quality and auditing standards. Overall, the certification program will help limit malicious software and program vulnerabilities while fostering a formal discovery process for quality applications.
Decentralized Identities with Dish and Acuant
Atala PRISM is a significant innovation of the Cardano blockchain. The decentralized identity solution underlies one of the largest blockchain deployments to date undertaken by IOHK and the Ministry of Education of Ethiopia. The initiative seeks to build a national ID and attainment recording solution on top of the standard. Moreover, Atala PRISM will likely help CeFi and DeFi platforms on Cardano stay astride KYC/AML requirements amid ongoing regulation of the cryptocurrency space.
Naturally, the Atala PRISM product suite played a major role in summit. In addition to teasing the coming Atala PRISM training course, Product Manager for Prism Mark Griffin gave a concise overview of the tech:
More importantly, however, Griffin announced a strategic partnership between IOG and Acuant. Acuant is a leading identity platform for fraud prevention and AML compliance. As such, Acuant will help ensure that actors in the DeFi space remain compliant. As such, the identity verification company will integrate Atala PRISM into issuer ID and compliance products.
Along similar lines, IOG also announced a strategic partnership with DISH. The Fortune 250 company acquired Boost Mobile in August 2020 and is working to bring open standards to the telecom space. For this, they are looking to decentralized identities to lay the foundation for a rich services ecosystem that incorporates products as essential as banking.
Atala PRISM will help provide these services to the startups growing subscriber base while simultaneously empowering consumers to maintain control of their ID. The move will also provide users increased access to value in terms of financial services as well as access to reward tokens.
For cryptocurrencies to realize mainstream adoption, developments will likely need to address the outsized levels of volatility in portions of the market. For instance, BTC’s price volatility is nearly ten times higher than major exchange rates (e.g., USD/JPY) . If nothing else, this implies unsavory currency risk for everyday consumers transacting in cryptocurrencies such as bitcoin.
Typically, traders bypass the issue by swapping digital assets for centrally-backed stablecoins like USDT during market swings. However, recent remarks by lawmakers suggest increased regulatory hurdles for centralized stablecoins moving forward.
During the summit, Charles Hoskinson and COTI CEO Shahaf Bar-Geffen announced that COTI, the fintech platform powering ADA Pay, would become the official issuer of the Djed stablecoin on Cardano. Unlike USDT, which is backed by reserves, Djed leverages an algorithmic design to ensure price stability.
According to an IOHK blog post, “Djed operates by maintaining a reserve of base coins, while minting and burning various other stable assets and reserve coins.” Moreover, the project’s research paper explains how the stablecoin’s design will allow for predictable transaction costs helping limit price volatility across the ecosystem.
If the project is successful, Djed will experience broad utility in the DeFi space. According to COTI, it may even become the primary payment method for transaction fees on Cardano.