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Could Cardano be More Decentralized Than Bitcoin
Cardano has been a big talk in the crypto world. As one of the major altcoins out there, it is billed as one of the few cryptocurrencies that stand a chance at challenging the dominance of Bitcoin.
Bitcoin always enjoys the first mover’s advantage, especially since it is by far the largest crypto by market cap. Hence, other upstarts are therefore required to table something better to stand out, or else they may not make sense in the market cap.
Lately, considering the hype around Cardano, it is one of the few altcoins mounting a challenge because of the project’s decentralization aspects.
Well, is Cardano more decentralized than Bitcoin? Continue reading and find out the mirror similarities of the two projects and how or why one is more decentralized than the other.
Arguments Supporting the Assertion
Some crypto analysts view that Cardano is indeed more decentralized than Bitcoin. Below are several points supporting that;
No White Paper
A white paper is a guide that serves to provide its issuing body’s philosophy regarding a complex matter. Then, the report goes ahead to advocate for a certain course of action as the most sensible one when resolving a complex issue. Thus, it has a high effect on the decision-making process.
Bitcoin, like most other cryptos, is bound by white paper. Cardano, on the other hand, utilizes scientific papers and design principles. As a result, they are less binding, giving leeway in arriving at a course of action within the blockchain.
The increased aspect of decentralization in the path followed during the decision-making process is quite useful in solving cryptocurrencies’ main issues. They’re mainly interoperability, scalability, and regulatory issues.
Full Mining Decentralization
The blockchain has recently achieved full mining decentralization. Creating all blocks on the network is 100% in the hands of about 2200 community pools. The ownership of the pools is also very decentralized, thanks to the stake pool saturation limit accompanied by the one pool to one wallet requirement.
Bitcoin’s mining pools are also in control of block creation but with a huge difference in pool ownership. While theoretically decentralized, the network’s ten largest mining pools control 85% of block creation in the blockchain in practice.
Cardano not only achieves a higher true decentralization in block creation but also gets security gains. For example, a 51% attack is less likely to be possible with a higher mining decentralization.
Largest Staked Value
As of writing the article, Cardano boasts of the highest staked value of any crypto at $28.84bn. That is almost three times that of second-placed Polkadot at $10.96bn. At the same time, it boasts one of the highest percent of staked coins at 74.17% of the total, largely owned by unique addresses.
Bitcoin doesn’t support the staking of its native asset. The gain with a high proportion of decentralized staking in a large figure is that one must control at least 50% of all staked coins to perform an attack. A large number of idle coins means that users choose to sell rather than hodl their assets. An attacker can quickly gain access to sufficient numbers and launch an attack.
Robust Future Decentralization Timeframes
Proponents of Cardano as being the more decentralized of the two also base their argument on the road map ahead for both coins. Thus, Cardano’s future is split into eras that signify more decentralization.
The Goguen era aims to enable a fully decentralized smart contract development platform accessible to all and easy-to-understand language. Basho’s era aims to make it possible for several decentralized blockchains or sidechains interoperable with Cardano blockchain to be created. Lastly, the voltage era shall usher in infrastructure that enables fully decentralized governance.
Bitcoin, in turn, lacks such robust future decentralization plans. Upgrades are made on a needs basis concerning prevailing challenges. Unless the need arises for further decentralization of the Bitcoin Blockchain in the future, it will remain more or less in the same position.
Argument Against the Assertion
On the other side of the coin, some believe that Cardano is still less decentralized than Bitcoin. The key point they hold is;
Still Has a Centralized Governance and Development
The blockchain’s development team still has full control over the governance of Cardano. The team is also responsible for most of the blockchain’s software building and development, all being under its founder.
Bitcoin’s development and governance, to a lesser extent, are heavily decentralized. Any member of the blockchain can initiate the development of software upgrades resulting in forks.
It is, however, worth noting that for both cases, approving an upgrade into a soft fork would still require majority approval by network node operators. In both cases, node operations are highly decentralized.
Cryptos are viewed as the most decentralized form of payment and trade in existence. Achieving complete decentralization of a blockchain is, however, a complicated and lengthy process.
When viewed as they are now, both Bitcoin and Cardano have their strong decentralization points. Cardano may have an edge in the number of decentralization metrics it outscores Bitcoin. However, the importance of these metrics is subjective and may or may not influence one’s choice of which is more decentralized.
On looking at their future roadmaps, it can be noted that Cardano has a very ambitious decentralization goal. It may, as a result, emerge as the more decentralized blockchain of the two and maybe the most decentralized blockchain in the future.