What is Cardano's Chang Hard Fork?

Cardano has officially taken the next major step towards the Voltaire era – a fully decentralized ecosystem. The first stage of the Chang hard fork was successfully completed on September 1, 2024. After its final phase, the community of people who are using the network will decide how it proceeds.

While the 2024 Cardano hard fork focuses mainly on revamping the governance structure, it also brings some protocol and node performance improvements.

What is the upgrade all about, what changes does it bring, and what to expect next – in this blog post.

Cardano Chang Hard Fork: Highlights

While the Cardano Chang hard fork date was preliminary set for Q2 of 2024, it eventually initiated and successfully happened on Sunday, September 1st.

• It marks the entrance into the Conway era of the Cardano ledger – the beginning of Voltaire, which is the self-governance phase in Cardano;
• The Cardano fork is named for Phil Chang, the visionary behind the design of Voltaire at Input Output (IOHK), who passed away in 2022;
• While the main focus is on governance, core developers updated the tech and infrastructure to smoothly hand off the power to the community;
• Chang #2 is a follow-on hard fork that happens at least 90 days after Chang #1 and activates full community participation in on-chain governance.

Let’s explore at what stage Cardano is now and look into the technical aspects of the hard fork and what new primitives for developers come with it.

What is Cardano (ADA)?

Before diving straight into the Cardano Chang update, let's first explore the background and the events leading up to it.

Cardano is a Layer-1 blockchain platform with open-source technology and smart contract capabilities. Launched in 2017 to the public, it was founded by Charles Hoskinsion in 2015, also a co-founder of Ethereum.

The protocol introduces and uses a unique Ouroborous Proof-of-Stake consensus mechanism, an algorithm selecting validators at random to process blocks. The algorithm randomly changes over time providing more security to the network because of extreme difficulty to predict and interfere with it.

The local state deterministic UTXO model is a key component of Cardano's architecture that defines its scalability, security, and strengthens smart contract (Plutus scripts) functionality.

The network’s reputation for consistent stability and flawless uptime is the direct result of its efforts to build a solid foundation. Cardano puts a value on careful planning and peer-reviewed research over quickly rolling out new features.

Its development follows well-defined, phased stages, wrapping each big shift in a separate “era”.

The Voltaire era that started with Chang's hard fork is the last phase of the roadmap after which only the community will decide how it proceeds.

What is Chang Hard Fork?

On September 1, 2024, with Chang, Cardano entered the initial stage of the largest upgrade since the Vasil hard fork dated back to September 2022.

The Chang hard fork is expected to activate the governance features outlined in CIP-1694, the Cardano Improvement Proposal, that lays out the framework of the Voltaire self-governance system.

1. It ensures that decision-making moves from the centralized entities leading the development to the community where ADA holders and stakeholders can propose and vote on network changes and manage the treasury.
2. While the main focus is on decentralizing governance, it also brings new features and capabilities for easier dApp development and optimizations of costs for smart contracts.

A hard fork in blockchain is a major change to a protocol’s core code that usually makes previous transactions incompatible with the new version, often requiring a complete restart. Cardano, however, approaches it differently.

Rather than wiping the past or dividing the chain, the blockchain continues with the new updates, adding new blocks without any disruption or loss of previous data.

Cardano Chang Hard Fork Readiness

As part of the preparations to implement the upgrade, Cardano node version 9.1.0 was released with a new genesis file that set the rules for the post-hard fork network.

Source: X

1. Cardano node operators switched to Node v9.1.0 to stay compatible with the ecosystem;
2. Stake Pool Operators (SPOs) upgraded their nodes to validate blocks in the new version;
3. Major dApps, centralized exchanges, and DEXs updated their infrastructure to avoid any service disruptions post-hard fork;
4. Developer tooling was also updated, ensuring that libraries and frameworks would remain compatible with the new network version.

Source: Intersect

Community Readiness

Although the original Cardano hard fork date was briefly postponed to allow more preparation time, once the key ecosystem participants confirmed their readiness, the network successfully initiated the upgrade in early September.

For ADA holders, no special action is needed. They can, however, ensure their wallets, applications, and tools were updated for full Cardano Chang hard fork support.

Chang Hard Fork: Technical Upgrades

Cardano Chang upgrade comes together with a brand new version of Plutus, a scripting language of the protocol. Plutus V3 scripts do not bring as critical upgrades as the previous transition from v1 to v2; they’re focused mainly on interoperability with some performance improvement.

New Cryptographic Primitives

Plutus V3 receives support for:

• BLS12-381,
• Blake2b-224,
• Keccak-256.

This will enable zero-knowledge proofs and rollups, and make Cardano and its smart contracts much more interoperable with other networks.

For example, the introduction of Keccak-256 now allows checking Ethereum signatures within Plutus scripts.

CIP-85: Sums of Products (SOPs)

Some changes come to the Plutus Core language by adding native support for data types allowing for more compact and efficient representation of data.

Source: Cardano Improvement Proposals

This directly impacts the size of scripts making them up to 30% faster. Smaller scripts mean less computational effort to execute, and less data to store, which also reduces the cost associated with running the smart contract.

CIP-58: Bitwise Primitives

Introducing Bitwise Primitives allows for the manipulation of data at the lowest level, level of bits.

New functions will enable conversion between integers (numeric data) and byte strings:

integerToByteString
byteStringToInteger

This was a limitation in earlier versions of Plutus, where arbitrary data handling wasn't straightforward. With this change, developers can create highly optimized code for specific use cases.

Overall, Plutus on Cardano becomes far more capable, flexible, and efficient. It optimizes costs for smart contracts and opens the door to complex, data-heavy applications with more use cases and features.

Chang Hard Fork: Cardano’s New Governance Model

On August 30, 2024, Charles Hoskinson announced that the Genesis Keys that gave certain administrative powers over the network to IOG, the Cardano Foundation, and EMURGO (three founding entities for Cardano) had been officially burned. Since that point, they have no central role in the governance.

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Instead, the Cardano community takes on a larger role in governance and shifts to decentralized decision-making. In other words, every ADA holder will be able to suggest and review proposals and budgets that could change the direction of Cardano.

Voltaire divides community participation in governance into three main roles or “branches”:

1. Constitutional Committee (CC) (currently the Interim Constitutional Committee);
2. Stake Pool Operators (SPOs);
3. DReps or Delegate Representatives.

Notably, any Cardano holder can register as a DRep directly from a Cardano wallet, such as Eternl, that supports governance features, allowing them to vote on proposals using the power of their ADA. The list of public DReps currently includes over 380 members and is rapidly growing

Source: Essential Cardano

Alternatively, users who are unsure of how to vote can delegate their voting power to a trusted DRep, who will represent their interests.

Why Become a DRep?

The financial incentives for becoming a Delegate Representative are still under discussion. However, the main incentive for stakers is that, after the Cardano Chang fork, to withdraw staking rewards, they must activate their wallet for governance by registering as a DRep, delegating, or at least registering and choosing to "abstain" if they prefer not to participate.

Cardano Chang Hard Fork Progress: Current Stage

Upgrading to a new era was a smooth transition except for minor outages that were shortly addressed with the hotfix (v9.1.1) so the network continued to function with minimal disruption.

The ADA network is currently in the interim, the so-called “bootstrapping phase,” between Chang #1 and Chang #2, which is expected to take place around December 2024.

Here’s what’s happening now:

• dApps and projects continue updating their web3 infrastructure and codebase to comply with ADA Chang hard fork;
• Workshops held across over 50 countries all around the world draft the Cardano constitution and select delegates to attend the Constitutional Convention in Argentina;
• At the convention, delegates will propose a constitution. DReps, Interim Constitutional Committee members, and Stake Pool Operators to ratify the version 1;
• DReps are given some time before the second phase of the fork to register and gain support from ADA holders.

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Approximately 90 days after Chang #1, once Chang #2 is completed, all governance features will be activated. Treasury reserves get unlocked, and users can start submitting governance actions and proposals, which will be voted on by the community.

Future of Cardano: What’s next?

After the full completion of Chang hard fork, the community will take on the responsibility for the future of the network. Holders will be able to decide where to put money from the treasury, how to set the protocol parameters, who they want in specific government roles, and set protocol principles and values.

Giving the power to people has the potential to foster a lot of development on the network and set the stage for more advancements.

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