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CARDANO: Collaboration with New Balance and Partnership with COTI to develop an ada payment gateway

Biweekly update 17th October — 31st October

The collaboration with New Balance is the first commercial deployment of its blockchain. A successful pilot for NB Realchain shows how the global retail industry can make use of distributed systems. NB Realchain lets each customer log their purchase on the Cardano blockchain. Verification on the system means that all goods sold, even those coming from a third party, can be digitally proven to be authentic. Bringing blockchain technology to global brands and mainstream retailers is a big step for decentralized technologies.

The Cardano Foundation has teamed up with COTInetwork to offer an ada payment processing solution for merchants. The payment solution can be easily integrated directly into the website via an adaPay button or a QR-based point of sale (PoS) system. The offering will allow merchants to accept ada payments with a near-instant settlement into 35 fiat currencies directly into their bank accounts.

Finally, an interesting article from @Cardanians_io under the headline “What’s the difference between paper and smart contracts?” was published.

Stay tuned!


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This week the team finished Daedalus newsfeed infrastructure setup. This was the last step in the preparation of the upcoming Cardano 1.7.0 release, which includes Daedalus 0.15.0 and Cardano SL 3.1.0.

Work continued on the desktop installers for the Jörmungandr testnet, with further progress now dependent on the cross-compilation of the wallet service. The team created a nix-free way to launch Daedalus in a frontend-only mode.

A note has been added to the ‘Wallet UTxO Distribution’ screen. This informs the user that pending transactions may affect the accuracy of the data presented on the UTxO distribution chart. The note also displays the number of pending transactions a user has in his wallet.

The ‘Delete Wallet’ option shown on the ‘Wallet Settings’ screen has been redesigned to fit better with the newly added ‘Wallet Recovery Phrase’ section. The ‘Delete Wallet’ link has been replaced by a ‘Delete Wallet’ section, which provides more information on this option and highlights the importance of knowing a wallet’s 12-word recovery phrase before it is deleted.

In the scope of regular maintenance tasks, the team worked on fixing minor styling issues on the Cardano theme and optimization of the flat button colors. The react-polymorph ‘Dropdown’ component has been optimized to better fit the requirements and usage-patterns of the Daedalus UI.


This week the team finished the implementation of the design for the ‘Transaction Details’ and ‘Stake Pools List’ pages. This is an important milestone as now all the key UI elements have been completed for implementation within the Jörmungandr Explorer App, with the initial version to be derived from the example application contained within the js-chain-libs repository. This makes full use of the GraphQL API exposed by Jörmungandr and will serve as a baseline to continue development in parallel with the Byron Mainnet explorer.


It has been an intensive week for the wallet backend team. The team’s efforts in testing rollbacks and chain-following have finally paid off. While part of the team was busy with making sure the wallet worked in a decentralized setup — where nodes may switch to different chains arbitrarily — another part has focused on getting data about stake pools stored in a database and served through an HTTP interface. This will enable frontend clients like Daedalus to give insights about available stake pools and how they perform.


Last week, the network team started exploring the Windows overlapped IO API to get reliable support of IO on Windows. The team also integrated the latest space-leak fixes and performance tweaks in the block-fetch protocol into the cardano-node repository and provided an ARM how-to: useful for people who would like to build and run a cardano-node on RockPi. Lastly, the team started polishing error policies, which are important for making the node — and clients — production-ready.

On the P2P front, the team worked on network topography generators and are looking into interactive plotting solutions for Haskell. Part of the team also met at a major Haskell conference. IOHK had a solid presence, IOHK colleagues presented five (four by the networking team, the other related to IOHK’s work on P2P) highly valued talks, which can be found online:

- IOHK’s session-type framework

- State machines and categories

- Talk on probability monad, which was used as a reference for simple network topologies in the team’s work on P2P


DevOps has been working hard on getting installers working for Daedalus that integrate with the Cardano wallet and Jörmungandr. The DevOps team has also been refactoring deployments for Jörmungandr and Cardano, to make it easier to deploy production clusters.


The team updated the spec with a new mechanism for bringing the rewards from the incentivized testnet onto the mainnet. The team have also completed writing more generators, and are close to having the ones needed for the ledger/transaction level. However, there’s still work to be done to get to the top chain level, where the team is generating block headers, etc. The team also added more high-level properties to the plan and made progress on the Byron-annotated serialization. They are now down to fixing a few test failures.


Last week, the Plutus team made improvements to logging and error handling in contracts, where they added an error constructor to deal with errors that happen during contract execution.

The team also updated the currency contract and improved the pubkey contract, and made changes that enforce the correct type for the ValidatorScript.

The Marlowe team made further updates to the Marlowe tutorial, to highlight the differences with previous versions. They are also preparing for the new version of the Udemy course for publication very soon.


This week the team integrated the latest Cardano wallet backend and Rust node into Daedalus, which opened a chance to integrate network information with the V2 API endpoint. Since there were several changes to the API specs, the team had to update the implementation of already-implemented endpoints — mainly the ones for handling wallets and transactions.

In order to further improve performance, the team worked on reducing layout re-renderings by optimizing data handling.

In the scope of regular maintenance tasks, the team also worked on fixing the build mode of Webpack auto DLL plugin and speeding up Storybook builds.


Full-scale performance testing of a mainnet Byron deployment of Cardano GraphQL was initiated using the four services of the stack: AWS RDS cluster, Haskell PostgreSQL write service, Hasura, and the GraphQL server. The initial goals were to identify performance bottlenecks, analyze SQL query performance, and determine areas that would benefit from optimizations. The results were used to make improvements to the underlying SQL schema in coordinating with the node client developer, and the interface improved to enforce more explicit query argument requirements.


This week the team implemented pagination, which is used across the app, and worked on polishing the UI and optimizing the UI components structure.

A load test has been designed based on the application query profile and will be used next week to assist with planning the public deployment, in addition to establishing a benchmark to run as part of CI.

The API team also assisted with providing technical direction on how the full stack can naturally be applied within the Jörmungandr networks, adding value as a complementary application for the testnets.


The team is closing the gap between the current Byron wallet implementation and the new Shelley implementation by providing a featureful API supporting both Byron and Shelley wallets at the same time. This will allow easy migration of Byron wallets to the new Shelley format (API documentation available).

The team is also adding extra features to make users’ lives easier by pushing more information through the API. It now reports about things such as node’s tip and height, network tip, and precise syncing progress of both wallets with the network and node with the network.

In parallel, efforts are ongoing on stake pool tracking and listing by pulling information from multiple sources (blocks themselves and the node) and combining them into a single digestible source for API clients like Daedalus.


This week, the networking team has been working towards a production readiness of clients (explorer and node). For this, they extended the subscription worker to support local clients and updated the error policy patch. Both changes are in review.

The team has been working on asynchronous IO on Windows using the Windows API, and wrote a small demo application which shows that the multiplexer works on Windows using this approach. They also wrote channels that support delays based on ΔQ: a change that allows for improved tests, and enables the team to write more complex test scenarios of ouroboros-consensus.

The team also made small changes to the MonadFork, splitting MonadThread out of it, which gives access to two operations: retrieving thread ID and labeling a thread, which is useful for more debugging scenarios using GHC’s event log. Lastly, the team is continuing the design work of the P2P selection mechanism.


The DevOps team has been continuing their work on the Jörmungandr node.


The team continued to add generators and property tests. They now have the pool registration certificates and protocol parameters being generated and have new property tests using them. It took some work to make sure there were valid signals in the traces generated.

The team also gathered and organized examples to begin benchmarking the different shrinkers. In addition to property testing, the team now has proof sketches of why the properties are true. Currently, these are hand-written; they will be polished and put into a LaTeX document.


This week, the Plutus team worked on ledger updates to pass PendingTx as a data type and make the specification simpler. The team also added an escrow to the contract. This works like the crowdfunding contract, in that contributions can be made in parallel. The Marlowe team changed the wording within Blockly to avoid misconceptions and to make the representation more compact. They also added symbolic execution for the Marlowe Playground and made some other minor updates.

Social encounters

EMURGO CTO, Nico Arqueros, and Engineering Lead, Sebastien Guillemot, give you a crash course on what the incentivized testnet is.

In 1844 a paper was released by a person that went by the name of “A.A.L”.

A.A.L. discussed a theoretical machine being worked on by mathematician Charles Babbage.

A.A.L. then theorized that this machine could one day be able to perform all kinds of complex equations and even create music. A.A.L. wrote a set of commands for the still incomplete machine that would allow it to generate Bernoulli numbers. It was not until 20 years after her death that A.A.L. was revealed to be “Augusta Ada Lovelace”. Today she is considered the world’s first computer programmer.

While Ada Lovelace came very close to being featured on the new British £50 note — she unfortunately did not make it. However, the Cardano token — ada — was named in honor of this great British mathematical visionary who worked on the Analytical Engine, a mechanical general-purpose computer design.

Smart contracts idea is probably older than you think. Smart contracts were first proposed by Nick Szabo, who coined the term in 1994. You can check his original work:

What is a contract

A contract is an agreement between two parties that mutually agreed to behave or act as the contract states. The contract usually has to have a specific form (date, conditions, names, signatures) and if any party does not agree with the acting or not acting of the other party then the law have to get engaged to solve the issue.

The issue is that in the real world a paper contract cannot enforce the correct or honest behavior of the participants. There must be a third party that solves all possible issues. Thus there are so-called legally binding contracts. “Legally binding” means that the parties must obey the terms written in the contract and perform their contract duties as stated. Failure to do so may result in legal consequences, such as a damages award.

We are able to avoid middle-man when we want to send a transaction. A distributed network can act as a middle-man and ensure that a transaction sent by Alice to Bob will be processed as expected if all conditions are met. Bitcoin does it quite well.

Why smart contracts

What if we could create a digital contract and use it similarly as a transaction between Alice and Bob? What if Alice and Bob could create a digital contract between each other and a distributed network, as a middle-man, ensures correct execution and enforces both to act honestly? This is exactly what a smart contract can do. Let’s have a look at what Nick Szabo wrote about it in his work:

We also see that to implement a full customer-vendor transaction, we need more than just the digital cash protocol; we need a protocol that guarantees that the product will be delivered if payment is made and vice versa. Current commercial systems use a wide variety of techniques to accomplish this, such as certified mail, face to face exchange, reliance on credit history and collection agencies to extend credit, etc. Smart contracts have the potential to greatly reduce the fraud and enforcement costs of many commercial transactions. Digital cash protocols use several of the rich new building blocks coming out of the fields of cryptography and computer science. Most of these components have not yet been widely exploited to facilitate contractual arrangements, but the potential is vast.

Finally, we can extend the concept of smart contracts to property. Smart property might be created by embedding smart contracts in physical objects. These embedded protocols would automatically give control of the keys for operating the property to the agent who rightfully owns that property, based on the terms of the contract. For example, a car might be rendered inoperable unless the proper challenge-response protocol is completed with its rightful owner, preventing theft. If a loan was taken out to buy that car, and the owner failed to make payments, the smart contract could automatically invoke a lien, which returns control of the car keys to the bank.

As you can see, Nick stated that we need more than just a transaction system to guarantee that the product will be delivered if payment is made.

It works fine with fiat since there is the law. If an online shop does not deliver a product for that you have already paid then you will engage the law. You will call the police or contact the appropriate national authority. You have a signed paper agreement in your hands and it is what the authority needs to process. It can take some time but eventually, you will probably get your money back or the dishonest online shop will be closed.

Bitcoin network is not able to ensure trust for such simple tasks as online shopping or even sending a value to a person you have never met before. You have to build trust between the counter-party if you want to transact with each other. For example, it can work for the relationship employer-employee. Still, if the employer decides not to pay you after you have hardly worked the whole month you will have to again engage the law.

Even if you do it via an escrow account the parties must find a person to whom they both believe. It is still too complicated and trusted.

So if we really want to utilize the whole potential of distributed networks we need to resolve the mentioned payment issues and establish trust between parties. It is what smart contracts can do for us.

How smart contracts work

A paper contract is just an agreement and parties are responsible for execution. For example, if Alice promises Bob to pay him $1000 for 4 Tesla stocks then they are both responsible to hand over the money and stocks. They can do it hand-to-hand if they are close to each other. If not, Alice could pay in advance and Bob will send stocks once he receives the money from Alice. In this case, Alice must trust Bob that he is honest and will send the stocks. Alice is at a disadvantage.

A digital smart contract is responsible also for the execution part of the agreement.

The situation will be much better for Alice and Bob if they utilize a smart contract. First of all, they make an agreement and create a digital form of it. In the smart contract, there will be Bob’s address for the payment and the amount of money Alice must send. There will also be Alice address for the stocks and expected amount. Once the contract is so-called deployed, what is a similar process to signing a paper agreement, the execution part is fully in control of the distributed network that processes the smart contract and nobody is able to change it or stop it. Neither Alice and Bob nor anybody else in the world.

The smart contract is 100% fair and does exactly what is supposed to do. It does not matter the order in which Alice and Bob send promised assets. The smart contract is able to keep digital cash and stocks in a temporary dedicated account. Once the smart contract is able to swap the assets it does it. If one party does not send the asset then after a specified time the contract sends back the asset that is in the temporary account to the former owner. Nobody can cheat and it never happens that one party has both assets and the other none. The smart contract is a trustworthy and reliable middle-man. Notice, that there is no reason to engage the legal authority at any moment. The smart contract is conflict-free meaning that if it is written smartly then it takes into account all possible results and all parties exactly know what happens under given conditions and when. Smart contracts behave deterministically.

What is a smart contract

A smart contract is a computer code that has to be written by a special smart contract programming language. In other words, a smart contract is an automatically executable set of rules that were provided via a computer program.

The code is written off-chain by a programmer and then has to be deployed what is a similar process as sending a transaction. A transaction is also built in a wallet and then sent to the network. Once the contract is deployed it is stored in the blockchain and it is executed by a special piece of software called virtual machine.

Virtual machines run on nodes in the distributed network and execute smart contracts. The execution result is then taken and mutual consensus among nodes must be achieved. This is very similar to what happens with common transactions. You can imagine that as a big global computer that consists of many distributed nodes. So the contract between Alice and Bob is processed on many computers and the consensus must be achieved to have a single version of the truth and/or behavior.

A smart-contract code allows decentralized automation by facilitating, verifying, and enforcing the conditions of an underlying agreement. During the execution of smart contracts, it is verified whether all conditions are met to produce some expected outcome or perform some predefined action.

Smart contracts will be most beneficial in business collaborations where parties can agree on something, build a contract and let it automatically execute. It is useful for any kind of sales, loans, purchases, bet, and more. Smart contracts reduce the risk of fraud or tampering, and as there is no third-party involved, the costs are also reduced.

Cardano smart contracts programming language Plutus

Smart contracts for Cardano will need to be written in Plutus or IELE and is intended to support a higher level of assurance. Plutus is a smart contract language using the Haskell programming language. Haskell is recognized at the academic and developer level for its mix of academic and industry-grade talent with core credentials in computer science. Thus, writing smart contracts will be safer and more reliable than any other smart contract language. Plutus Platform will be a Haskell library and will be an accessible toolbox for developers to create smart contracts and can support code that runs on-chain and off-chain. Due to peer review and high assurance, the code for the Cardano smart contracts is secure, tested, and documented. Ultimately, it is this research-first driven approach used by a professionally credentialed team of academics and cryptography experts that separates Cardano and Cardano smart contracts from others in the space.


Marlowe is a new language for modeling financial instruments as smart contracts on a blockchain. It has been designed for people who are business engineers or subject experts rather than experienced developers. It is a simple domain-specific language (DSL) which comprises a small number of powerful building blocks that can be assembled into expressive financial contracts. It is embedded in the Haskell language, which has its own established ecosystem and testing framework. You do not need programming expertise to use Marlowe and you can explore your Marlowe financial constructions with a browser-based contract editor and simulator.

Marlowe interacts with real-world data and enables the expression of smart contacts. It is aimed at fixed-duration financial products, such as hedging, fixed-term deposits, credit swaps, and crowdfunding. Marlowe is ideal for financial start-ups, analysts, or those in the fin-tech community as well as universities who could use it for testing within their financial courses. With Marlowe, you can write smart contracts for financial instruments that are easy to read, write, and understand without programming experience.


As Charles Hoskinson said in one interview “ One of the biggest problems with Bitcoin, is that it’s blind, deaf and dumb and that was by design.”. Bitcoin was never intended to replicate the current financial systems and be compliant with them. However, we desperately need it to continue building a decentralized world. It will not be easy at all and there is a long way to go in front of us. People must learn new programming languages and blockchain principles to build reliable smart contracts. They have to know that what is deployed once it cannot be changed and stopped. There is no space for human errors. It will take a long time until Alice and Bob use a smart contract for swapping assets.

This release brings important changes to Daedalus, including newsfeeds for delivering news and notifications to users and verification of the wallet recovery phrase, alongside general UI fixes and improvements.

Upcoming events

Below are the new Cardano Meetup groups:


Token holders and the number of transactions dynamics (information from


>> The Basho era of Cardano is an era of optimization, improving the scalability and interoperability of the network. Basho is about improving the underlying performance of the Cardano network to better support growth and adoption for applications with high transaction volume.

>> One of the core developments of Basho will be the introduction of sidechains: new blockchains, interoperable with the main Cardano chain, with immense potential to extend the capabilities of the network. Sidechains can be used as a sharding mechanism by off-loading work from the main chain onto a sidechain to increase the capacity of the network. They can also be used to introduce experimental features without affecting the security of the main blockchain.

>> Basho will also see the introduction of parallel accounting styles. While the main Cardano blockchain will continue to use a UTXO model, the ability to support and switch between UTXO and account-based models will be added using sidechains. The result will be greater interoperability for Cardano, as well as the ability to support new kinds of use cases on the network.

>> The Basho era will see Cardano become one of the most high performance, resilient, and flexible blockchain platforms in the industry. This will provide network infrastructure with the capability to scale in a sustainable, secure way, as well as the ability to add new functionality without compromising the reliability at the core of the network.

Partnerships and team members

Footwear manufacturer New Balance Athletics Inc. announced today the launch of a pilot program to track the authenticity of its newest basketball shoe using a distributed ledger blockchain to provide trust and provenance for every customer.

To provide the blockchain, New Balance teamed up with Input Output Hong Kong to develop the “New Balance Realchain.” The distributed ledger technology platform will be built atop IOHK’s Cardano blockchain.

The New Balance Realchain will launch alongside the release of the OMN1S shoes Friday, and the pilot program will allow new customers to record their ownership of the shoes.

Blockchain technology uses a massively distributed database that records transactions to every copy across a network while also using cryptography to secure data. Every transaction submitted to the network must be agreed upon by enough of the network to be added to the ledger and it’s then secured using cryptographic keys. Data about the authenticity and sales record of a luxury item thus can be tracked in a trustworthy manner.

For the New Balance OMN1S shoes, customers will receive a Realchain card with an embedded identity and security chip. Upon receiving the shoes, the customer can then use the New Balance app to scan a Quick Response code on the card with the app and will be prompted to scan the chip within the card and that will authenticate the shoes on the IOHK Cardano blockchain.

Customers can then claim ownership of the shoes by entering a code printed on the tongue of the shoes into the app. From this point on, the ownership of the shoes is secured to the owner using the New Balance Realchain blockchain platform.

This is the first deployment of IOHK’s Cardano blockchain in retail. Using this pilot as a testbed for future retail use, New Balance intends to continue to harness the power of blockchain technology for its products.

Blockchain technology’s usefulness to provide authentication for products has been piloted for shoes before by Chronicled Inc., a vintage sneaker company, which raised $3.4 million in 2016 to make a similar platform to New Balance. The luxury clothing brand Alyx, from designer Matthew William, announced a similar blockchain in May that used Iota Foundation’s blockchain to track the production of clothing from raw materials to final products enabling customers to “see the journey” that made their shirt or dress.

IOHK intends to continue to develop its Cardano blockchain technology and partner with governments and organizations in Georgia, Ethiopia, Mongolia and elsewhere, to use that technology to enable authenticity and identity proof for products and services.

In addition to providing provenance for the New Balance OMN1S sneakers with the Realchain platform, IOHK will continue to look for more opportunities to partner with other industry leaders for authenticating goods, reduce fraud and add value. The company intends to offer its blockchain to a wide spectrum of industries including pharmaceuticals, international development and finance.

The Cardano Foundation and COTI, an enterprise-grade fintech platform, are to develop an ada payment gateway. The offering — due to launch in November — will allow merchants to accept ada payments with a near-instant settlement into 35 fiat currencies directly into their bank accounts.

COTI is developing and implementing the service, making the ada payment gateway solution simple to deploy for merchants. The payment solution will be easily integrated directly into a merchant’s website either with an adaPay button or a QR-based point of sale (PoS) system. The offering will simplify accepting and settling ada payments, and enable merchants to manage all transactions in real-time.

The Cardano Foundation will leverage COTI’s Universal Payment Solution (UPS) to power the ada payment gateway offering and further extend the utility use case for the token — both inside and outside of the Cardano ecosystem. The COTI UPS will provide a comprehensive ada payment solution that will combine all existing support systems of traditional payment processors with the added value of digital assets.

As COTI UPS is extended to provide other financial services, such as lending products and prepaid debit cards, these will also be made available to ada merchants.

About COTI: COTI is an enterprise-grade fintech platform that enables cross-chain interoperability and is built on its own DAG-based chain. It supports extreme scalability and low transaction costs and is supplemented with payment-specific requirements in the form of COTI Pay, a holistic digital payment solution. COTI Pay empowers enterprises and merchants to receive any kind of payment method and build their own payment networks and Coin as a Service (CaaS), settle instantly, earn interest and grow their businesses through working capital loans. Find out more: 194

About the Cardano Foundation: The Cardano Foundation is an independent body based in Zug, Switzerland, with core responsibilities to help oversee and supervise the development of Cardano, the world’s first third-generation blockchain, and its ecosystem. The Foundation is committed to protecting and promoting Cardano, the first blockchain platform developed for smart contracts using a scientific philosophy, and to advocate on behalf of the users and community of the protocol. The Foundation works alongside Input Output HK (IOHK), who are contracted to design and build Cardano, and EMURGO, the for-profit arm working to boost the Cardano ecosystem through commercial ventures. The three entities are wholly separate in governance, ownership, and leadership.


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Social media metrics

Social media activity
Social media dynamics
Social media dynamics

The charts above illustrate a decline in the number of Telegram followers. In general, Cardano experiences an average level of social activity.

The graph above shows the dynamics of changes in the number of Cardano Facebook likes, Reddit subscribers and Twitter followers. The information is taken from

This report is not financial advice.

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