On the blockchain, smart contracts are little pieces of code. They have the potential to revolutionise the game. A blockchain database is nothing more than a sophisticated ledger that can record and track transactions and data without them. Smart contracts, on the other hand, turn the blockchain into a programmable platform that can host other applications.

Cardano's Alonzo upgrade adds Plutus, Cardano's proprietary smart contract development language. Cardano wants individuals to be able to build smart contracts platform even if they don't have a technical background.

Here are some of the things smart contracts enable:

• Decentralized finance (DeFi) applications: This is an umbrella term for financial applications that operate without the use of intermediaries such as banks, such as lending without the use of a middleman.
• Non-fungible tokens (NFTs): These one-of-a-kind digital assets are frequently collectibles like as paintings or sports cards, with built-in digital signatures storing ownership data.
• Gaming applications: NFTs allow players to own in-game assets, and smart contracts can alter the way gaming economies operate.

Smart contracts and Cardano

Cardano has taken a deliberate and methodical approach to its growth. Prior to deployment, the team believes in conducting extensive study and testing. It may surprise you to learn that this is not the standard in crypto; in the race to make the most of blockchain technology, many currencies launch goods first and then develop them over time.

Cardano's technique will almost certainly result in a more secure, scalable, and robust solution in the long term. Hoskinson built the blockchain from the ground up to address some of the challenges that Bitcoin (BTC) and Ethereum (ETH) faced as early adopters (ETH).

In the short term, this means that other platforms, particularly Ethereum, have dominated the market. Almost 80% of decentralised applications are presently developed on Ethereum, according to State of the dApps, a website that records them.

Ethereum, on the other hand, is having difficulty keeping up with the enormous demand because its platform is too slow. Users must deal with high fees and network congestion until it can upgrade to Eth2. Cardano's smart contracts may entice some of those users to migrate to its platform.

What does this imply for investors?

In anticipation of the Alonzo update, Cardano's price has increased by nearly 65 percent since the beginning of August. This propelled it into the top three cryptocurrencies by market cap, according to CoinMarketCap data. Following the announcement, it climbed to a high of $2.25, approaching Cardano's all-time high of $2.46 set in May. Cardano may be purchased on all major cryptocurrency exchanges.

Once Alonzo is live, it will be interesting to see how many developers utilise it and whether any technical issues arise. At the end of September, Cardano will convene its annual summit. It will be virtual, allowing investors to sign up and get the inside scoop on what the coin's future holds.

Cardano has recently been under fire from detractors who complain about development delays, specifically the time it takes to launch smart contracts. As a result, smart contracts are vital not only in and of themselves, but a successful on-time launch will also reassure investors that Cardano can deliver.

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