🌎 Cardano’s Chang Hard Fork to Usher in Voltaire Era with Governance

Cardano is preparing for the Chang hard fork, which will usher in the Voltaire era by introducing on-chain governance. This upgrade allows ADA holders to vote directly on key decisions, moving the platform closer to a fully decentralized blockchain ecosystem.

A Deep Dive into Cardano’s Development Stages

Cardano’s development is divided into phases known as “eras,” named after influential poets, mathematicians, or computer scientists. Each era introduces new features through hard forks:

Byron: Launched Cardano’s foundational network, enabling ADA transactions.
Shelley: Transitioned the network to decentralization with community-driven block production.
Goguen: Introduced smart contracts and the capability to build decentralized applications.
Basho: Focused on optimizing scalability and interoperability.
Voltaire: Will introduce decentralized governance.

In addition to the main phases, eras often include multiple sub-eras, such as Goguen, which had Allegra, Mary, and Alonzo, bringing more specific features. The Chang hard fork will be the first hard fork and sub-era of Voltaire.

What is the Chang Hard Fork?

The Chang hard fork allows Cardano holders to vote on protocol changes and governance actions, with the option to delegate their voting power to designated representatives, known as DReps.

In addition to governance, Chang brings enhancements to Cardano’s smart contract platform through the introduction of PlutusV3. PlutusV3 includes new cryptographic primitives, such as BLS12-381 and Keccak-256 cryptographic functions, which improve the security and efficiency of operations like zero-knowledge proofs and digital signatures.

Moreover, Chang adds bitwise primitives, which allow developers to perform low-level data manipulations within smart contracts. These primitives can optimize how contracts handle and store information, leading to faster execution and reduced costs for DApps. These improvements make it easier for developers to create more complex and efficient DApps on Cardano.

The upgrade will also refine how transaction fees are calculated for DApps by adjusting protocol parameters related to reference scripts. Reference scripts help reduce the size of transactions, lowering costs for users and increasing the network’s capacity to handle more transactions simultaneously.

Node operators, particularly stake pool operators, need to upgrade to version 9.1 to support the new governance mechanisms and smart contract improvements. For the hard fork to take place successfully, 70% of the network’s stake pool operators must upgrade their nodes to version 9.1. The new version was released on July 25, and just 12 days later, more than one-third of the network is already running it. As of August 5, around 63.7% of operators are running version 8.0, 1.3% are still on version 9.0, and about 35% are using version 9.1.

What Past Hard Forks Reveal About ADA’s Future

Historically, ADA’s price has shown a pattern of downturn following major Cardano upgrades, with one exception. The Allegra upgrade is the sole instance of significant price appreciation, with a 133% increase. This anomaly skews the overall average, creating a misleading impression of a 9.88% average price increase one month after upgrades. However, when the Allegra hard fork is removed from the dataset, the average price change reveals a decline of -14.74%.