Do errors in first public testnet dApp, post Alonzo hardfork, mean ‘death of Cardano’

Amid much community fervor, Cardano’s Alonzo testnet hard fork finally took place last week. The primary anticipation was behind the inclusion of Plutus smart contracts into the network, which would allow it to vastly expand its functionalities. The community’s enthusiasm was clearly reflected in the bull run that Cardano’s native token ADA has been on, as it set new ATHs all month.

After taking it for a spin, however, users claimed that Alonzo was not all that it was propped up to be. Ever since the first dApp, multi-pool DEX Minswap, went live on the Cardano public testnet, many have complained about facing errors while trying to swap tokens and provide liquidity. The concurrency related errors were addressed by the Minswap on Twitter as well.

You may be seeing an error message that says "UTxOs are being used this block" a lot. That's the concurrency issue. We're working on that.

— Minswap Labs (@MinswapDEX) September 3, 2021

While Cardano is no stranger to online trolling and criticism, Minswap’s difficulties with handling multiple users became the most commonly cited excuse for its haters. Many have claimed that Cardano’s decision to use the unspent transaction output accounting model (eUTxO ), was the reason behind this failure. Further, that future DEX’s looking to build on the network will face similar liquidity issues.

I hate to be dramatic, but public testnet UX at @MinswapDEX has been horrible. The UTXO model is simply unusable in #defi systems due to the #concurrencyissue. Could someone plz provide some clarification as to how and when this will be resolved?

— binbal (?,?) ?⛓️ (@binbal24) September 4, 2021

Concurrency issues often result in the prevention of multiple users from interacting with the protocol at the same time. This is likely due to the absence of a “Cardano Virtual Machine,” akin to what Ethereum deploys, as it allows smart contract operation to run concurrently. Others have claimed that since Minswap was only able to handle one transaction per block, it was usable.

Ethereum supporter, Anthony Sassano highlighted these issues in a Twitter thread recently.

The first dapp went live on Cardano today and ADA fanboys are finally discovering that you can't peer review your way out of fundamental issues. pic.twitter.com/tYQXNcVKGN

— sassal.eth/acc ?? (@sassal0x) September 4, 2021

However, many supporters have hit back at the harsh criticism, including Cardano founder Charles Hoskinson, who called these comments “noise and FUD.” In a recent video addressing these issues, he said,

“The problem our industry has is, it basically says well if you don’t support my thing or I can’t see a way to make my thing work, what you have constructed is absolutely useless, forever useless, and it’s just a toy. And then they use vanity metrics, not even understanding what they are saying.”

Moreover, decentralized Cardano-based exchange SundaeSwap Labs dispelled some common misconceptions about the issue in a recent blog post. According to the DEX, it was possible to carry out hundreds of transactions per block and that centralization was one of the ways to solve the issue. It also added that this hurdle did not spell out the death of Cardano, stating,

“So to the people claiming this is the death of Cardano: unlikely. To point to one rocky experiment in the earliest of early days of an ecosystem and hold it up as the fatal omen of Cardano’s downfall is premature naïveté at best, and intellectual dishonesty at worst.”

Moreover, the Cardano dev team Input Output HK also published a Twitter thread clarifying many of the users’ concerns and “misinformation.” Firstly, the company noted that the eUTxO model was chosen because it “offers greater security, allows for fee predictability, and offers more powerful parallelization.”

IOHK also suggested how users could still build dApps on the network and extend block limits, which is “by designing your service or application with multiple UTxOs, you can enforce more parallelism.” A blog post will be published by the company later this week to explain these functionalities in detail.