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Decentralization by Design

Cardano for the Masses: Age of Voltaire Edition Read-along

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We're reading the latest edition of Cardano for the Masses and want to encourage community participation by doing a read-along. We invite you to pick up the book, come along, leave a comment, and participate in the related every epoch giveaway when they come up!

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After introducing the basics of blockchain, Cardano, and Proof-of-Stake in chapters 1-3 of Cardano for the Masses, author John Greene turns his attention to the “eras” of Cardano roadmap. Each named for an interesting historical figure, the eras represent the planned milestones of Cardano’s development plan, and they make a neat organizational structure for the book’s next chapters. The book skips over the first era, Byron, which represented Cardano’s launch and its first years as a newborn network, still largely dependent on its centralized progenitors. Chapter 4 jumps straight to the second era, Shelley, when network growth and development led to newfound independence and excitement for the budding blockchain.

When discussing the Shelley era, most sources focus on the theme of “Decentralization”. Shelley debuted the public staking and reward systems that incentivized thousands of people around the world to get personally involved with the project. Author Greene makes a striking choice to put his survey of the Shelley era into a slightly different frame: Consensus. The angle here is that before decentralization can happen, there has to be a plan for how decentralized entities will maintain agreement about what is true, and what should happen next, and who is in charge of doing it. In blockchain, that plan is called a “consensus protocol”. In Cardano, the consensus protocol is named “Ouroboros.”


If you’ve spent any time swimming in the Cardano sea, you’ve at least heard mention of everyone’s favorite mythical monster, Ouroboros. Represented in lore as a snake (or dragon) eating its own tail, Ouroboros represents the eternal cycle of destruction and recreation. Many Cardano fans are very proud of Cardano’s consensus protocol, as it was, “the first blockchain consensus system to be created via peer-reviewed research as a more energy-efficient and sustainable alternative to proof-of-work.”

What casual fans may not realize is that Ouroboros is not a singular, static protocol, enshrined in the code base for all time. Rather, like all living software, it has versions, and its own roadmap, and engineers who are still working on its development. The Cardano network launched with Ouroboros Classic in 2017, updated to Ouroboros BFT in May 2020, followed quickly by Ouroboros Praos in August 2020. Praos has held its own for several years, but it’s not that anyone is resting on their laurels. Ouroboros Genesis, Hydra, Redux, Crypsinus, Chronos, Leios are all potential updates and versions of Ouroboros. Each made its debut as an academic paper, and proposes to solve some problem or make some improvement to the protocol. Some of them might be implemented together, and some might never be implemented at all. The takeaway as a reader was to learn that Ouroboros isn’t settled science. Instead, it is a carefully balanced machine, with many parameters, whose settings are not carved in stone. Instead, all around the world, interested scientists are still talking about those parameters, and how they should be set, and what new elements should be added. The overall goal is that Ouroboros should continuously support decentralization in a way that is secure and resilient.

If you are interested in how it all shakes out, keep your eyes peeled for an upcoming paper on “Ouroboros Omega,” which is still in the works but intends to be a capstone work, bringing together all the best ideas from all the versions that came before it.

Smooth transitions

The inevitability of change is something that has to be accounted for in any system, and everyone knows change can be difficult. For many blockchains to date, working through change has been even harder than usual. A really big system update to a blockchain can mean that the historical ledger, the very heart of the beast, is stopped, updated, and restarted in such a way that when it is restarted, the historical blocks are no longer readable by the protocol. This kind of major update is called a “hard fork.”

While necessary, hard forks can be very disruptive to blockchain communities: at the very least the change might be controversial, and at worst it can lead to split chains, double-spent coins, and security risks. This article prefaces its relatively level-headed overview of hard forks in a telling way: “Hard forks - this is war.”

In Cardano, the engineering team has put a high priority on seamless transitions when the code needs to be updated. The tool they created to do this is called the Hard Fork Combinator. In Cardano, you may see major updates referred to as “HFC” events, with reference to the fact that major updates use the Hard Fork Combinator to execute changes so smooth that end users may not notice any disruption. This is a point of pride for many Cardano fans, as expressed by Greene, “There has been no downtime or restarts with Cardano, which is not always the case with other chains.”


Beyond the Hard Fork Combinator, flexibility has been built into the very fabric of Cardano. This is done by means of dozens of parameters, both in Ouroboros, as mentioned above, as well as in the core protocol. These parameters are really interesting for intermediate Cardano explorers, who may find their curiosity piqued by all these parameters. As we start to understand each one, we might also begin to imagine how and why they might change, or if we want them to. The value proposition of defining the protocol with parameters is summed up in Chapter four like this:

“Because flexibility is so crucial, the Cardano protocol was built with genuine scalability in mind. Its parameterized technique is meant to bend and respond to price swings, network saturation and rising demand. There are a number of protocol options that may be used to fine-tune the network’s behavior without requiring a hard fork. But even then, larger modifications that do need this may be handled neatly using the Hard Fork Combinator (HFC). These are important differentiators for Cardano, since they provide it with durability and dependability, as well as very flexible upgrade options as the network develops and the user base grows.”

Full Decentralization

After a long hike through all the work that has been done to build a system that can support scalable, durable decentralization, Greene concludes the chapter by finally considering the topic itself. Decentralization pushes power to the edges, allows individuals to make meaningful choices, and gives every network member a stake. Cardano is focused on building decentralization in block production, network operation, and governance. Greene gives some of the many comparisons and examples that seem to prove Cardano’s exceptional decentralization pedigree, while acknowledging that the ways that we measure decentralization are not necessarily settled.

With a regulatory vacuum and no requirement for transparency, it’s not hard to make a digital asset look superficially attractive. With no agreed definition of what decentralization is, who is to say something is not decentralized?

A promising project that is working to provide a framework to measure and validate is the Edinburgh Decentralization Index . This project promises to offer an impartial, structured way to measure and compare the decentralization of competing networks.

Read along with us, and comment below with your favorite quote or take away from Chapter four.

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