15.12.2018 – Charles Hoskinson Video Update

The ‘end of the year’ video update from Charles Hoskinson comes in from Colorado where he has just returned from PlutusFest, which was held in Edinburgh. Read about Plutusfest here.

As always, Charles gives a brief video update about Cardano. In this video, he covers where we have gone throughout this year and some things to look forward to towards the end of the year.


  • As a company, IOHK, and the broader Cardano ecosystem has learned quite a bit
  • Many things were accomplished this process, for example, IOHK has written over 40 research papers (20 of which have been peer-reviewed)
  • IOHK have strived to followean evidence-based, specification-driven engineering approach
  • This means that formal specifications are written > this must show logic and mathematics > from this specification, code is extracted > and finally, it must be proven that your implementation is equivalent to that extracted code and therefore follows the specification

Cardano 1.4 Release

  • As of December 18 (today), it is the first time in Cardano history that something is being shipped that remotely connects to a specification
  • This significant release is Cardano 1.4 (You can read the announcement here.)
  • This release took a bit of time and there were several reasons pertaining to structure and scope creep, and that it was not anticipated the state of complexity where the code base was at
  • This release actually took 7 release candidates

Lessons Learned in 2018

  • Throughout this year, lessons were learned about QA and the Support Desk
  • IOHK learned a completely way of doing QA and running a help desk
  • The help desk has serviced over 10,000 tickets throughout its history!
  • And the new QA system has managed to dramatically decrease the QA cycle and massively improve the test coverage that IOHK has for a product
  • Overall, IOHK has managed to aggregate these together and with 9 months worth of lessons over 4 major releases, they are well equipped going into 2019 to provide better tests, smaller releases and higher code quality


  • Charles next discusses the systematic decoupling which has begun for the stack
  • Starting with the wallet backend: the next version will be completely decoupled and will be able to connect the formally-verified backend from not just the Haskell client, but also to the Rust client
  • This should be finished sometime in January
  • As a result, there will be very fast development time for wallet backend features, such as: multisig, manual selection of UTxO, manual transaction creation, and offline transactions
  • This will also mean that we will be able to move things that we’ve seen in the Rust client into General Daedalus
  • In early 2019, Daedalus will get a command line and you’ll be able to interface directly with the wallet backend through that command line
  • Hopefully, this will allow developers to take the whole wallet scripting idea which they had with Rust and port that over to the main client so that there will be no difference between those two

The Ouroboros Program

  • Charles describes the Ouroboros protocols in his update video as one of the crown jewels of the Cardano project
  • There was a huge amount of success: starting with Praos earlier this year going to Israel and onto Genesis which was presented in Canada as CCS, to Ouroboros BFT
  • There were multiple implementations of BFT with varying degrees of uses
  • There were also several prototypes of Ouroboros Genesis
  • It is exciting to see how these protocols have evolved and how much was learned
  • Now there are ongoing, deeply involved conversation with how we intend on writing the ledger specification and handling delegation
  • There will be doing a workshop with IOHK and 3rd party partners in early January in Berlin specifically to finalize the delegation specification
  • As always, this specification will be made publicly available

Ledger Specification

  • Charles goes on to quickly discuss the ledger specification
  • This spec defines all the rules for validating what is a legitimate and not legitimate in a ledger
  • This process creates almost like a DSL to describe different ledger rules (for example: describing differences with the ‘old’ Byron ledger and the ‘new’ Shelley ledger
  • Over a series of iterations, IOHK was not only able to create this but also massively simplified some of the rules where and when they could
  • This meant they concluded with a simpler code base overall and eschewed unnecessary complexity
  • To add, with the ledger, network and other specificatios, the entirety of the Cardano codebase is considerably higher quality (once Shelley is released) as it has ever been in its history
    -Charles also adds that it is probably going to be the highest quality codebase of any cryptocurrency ever made
  • There will be an enormous amount of evidence for that statement because of the property based testing, concise codebase, wonderful end to end testing conducted
  • It will be possible for any third-party to take a look and have a clear understanding of why the code behaves the way it does, how the code works and how to maintain and upgrade it

Icarus and Yoroi

  • This past year was a difficult one with lots of engineering and science, dealing with exchanges (sometimes with language barriers) and having a product in market that couldn’t work for certain people
  • Given that was the case, early this year, Charles authorized the work of the Icarus program
  • This was the fastest pieces of engineering
  • Starting in early March, the Icarus team gathered business and technical requirements, then built an engineering team in less than 2 months and over 3 months, was able to built a wallet from scratch with both Rust and Javascript components
  • This wallet also went through a full security audit
  • From here, Emurgo was able to take that reference code base and turn it into the Yoroi wallet
  • Since the time of launch, Emurgo have done several major updates on Yoroi
  • It has accrued a large user base consisting of 11% of the entire Cardano population
  • Charles and IOHK were happy to see how fast this project materialized
  • It has subsequently attracted other third-party participations to have conversations with us

Ledger Integration

  • The most commonly requested integration in our ecosystem has been the Ledger wallet
  • There are 3 factors which have delayed this integration and made it difficult for us to get Ledger support right when we launched:
  1. Cardano and IOHK were using a different type of cryptography and different type of HD wallet than what the Ledger team was used to encountering
  2. There was a middleman involved on creating support on the Ledger side and due to issues in this arrangement, there was dramatic slow down in the integration
  3. On our end, we simply had other priorities. Really what was holding us back was to move to a better, more standard way of handling the cryptographic side (namely deterministic addresses) and to have a new wallet backend
  • With the shipping of Cardano 1.4, half of that is done and the other half has been done before with Icarus so should be easy to roll into the wallet backend
  • Come January, we anticipate Icarus-style addresses coming to the wallet backend
  • The next update, Cardano 1.5, will have support for this
  • With Ledger support, not that issues at Cardano Foundation have been resolved and Emurgo has been scaling development, it should be on its way
  • There have been discussions with a third-party firm (Vacuum Labs) to work with both of us, to rapidly accelerate Ledger support
  • The integration will start with Yoroi and shortly after into Daedalus
  • This mean you’ll be able to use Ledger with both a full node as well as a browser-based interface
  • Within their scope, Vaccuum Labs wrote a 16-page report about the state of the work done previously – and their estimate is that there are 30-50 man days of engineering that needs to be done to clean up the work that’s been done and to ensure security
  • As a project and from Charles, we do hear the community who are asking for Ledger and there were factors that came into play that pushed it to the side
  • But now as an ecosystem and with great third-party support, we can move much more quickly
  • An additional fourth factor that delayed integration was that it was never clear until the second half of this year, how cold staking would be handled with a hardware wallet device
  • There are many different ways to do this
  • Some sort of offline or cold key management system would need to be built into Daedalus and this was always anticipated as something that IOHK would handle once Shelley was released and clear UI/UX was planned out for the delegation center
  • As a subset, there are 2 parts to the cold staking component:
    • Paper wallet side: a user with a paper wallet needs to have a mechanism to import a credential that allows them to delegate from that paper wallet without having the spending keys go live and hot and live within a computer
    • there also needs to be a mechanism on the ledger side to permit that and for other hardware wallets
  • Emurgo is also keen to have Trezor support, and there has been good progress made there as well. Announcement and updates will be made by Emurgo on this

Advantage of Lessons Learned

  • The advantage of these lessons learned in the past year is that month-by-month, we continue to see much better metrics, we see faster development time, better testing and higher code quality
  • Now, when incidents happen, the Cardano project is more easily able to resolve these issues
  • There is, of course, still work to be done…
  • There are divergent teams: there is a Rust team and Haskell team that are both building independent full clients for Shelley
  • The hope with this is that one can get to a testnet quickly and can start building up the stake pool population
  • In addition to the Shelley release, is a bit component of having the community ready
  • With some of the issues at CF, there were a few programs that had come up but not funded or initiated which are now underway
  • You can read the latest blog post from Cardano Foundation on their newly appointed council members here.

Ambassador Program

  • The purpose of this program is to create a mechanism to acknowledge people who have made substantive contributions to the community
  • It would also provide a structured way of communicating between the project and these individuals
  • And potentially funding their interests long-term
  • We will announce information and details on this program once readyb

Cardano Hubs

  • Another project that will initiate in the coming year is the idea of ‘Cardano Hubs’
  • There are people in the community who want to go above and beyond
  • This project will create an organization within the community that allow organizers in these hubs to engage and encourage Cardano-related activity within specific jurisdictions

Activity in the Cardano Community

  • Programs such as the ones mentioned will help increase activity in the Cardano community
  • Not to say that structure doesn’t already exist
  • Note that we do have many meetup groups around the world, some are surprisingly large and spread across diverse locations
  • But we need these programs in place to provide better resources to those who have taken the time to become Ambassadors for the Cardano project
  • Discussions are underway to gain momentum and these projects are a big priority to help building the community from the bottom up
  • Subsequently, an output of good community management will naturally be people wanting to run stake pools

Stake Pool Update

  • The way that IOHK plans to decentralise the protocol, they anticipate roughly 1000 or more participants in the system
  • The hope is that we get to that number as quickly as we can
  • Around April of this year, IOHK ran a pilot to see interest
  • The registration of this process did get far more than 1000 people expressing interest
  • The plan will be to reconstitute that soon in the next 60 days
  • From there, IOHK will convert that list as soon as we can (when the Shelley testnet is operational) to get as many people as we can to play around with it, to learn how staking works and to get ready for decentralization of the entire system

Speaking on FUD

  • We have noticed that there has been lots of FUD
  • Often this is because of common misunderstandings or applying things that other cryptos are doing, but in many cases, they are baseless lies
  • Charles talks on a few examples of FUD observed, such as the concept that because Shelley Is delayed, then everything else in the Cardano project is
  • But the reality is, the smart contract work has been following a different path than the consensus/delegation and rewriting of the entire code base
  • Smart contracts are being done by the Scala team and the language designing team, which is led by Phil Wadler
  • These teams form their own group with their own resources and have been following a two-year track
  • From this team, the Plutus and Marlowe projects have now come to a research end and are moving into actual implementation
  • None of the Shelley delays have cascaded into the language side
  • There has been other additional progress made with the work done with IELE, which was with a fork of the Mantis client
  • With IELE, two testnets were run and have been operational since the summer
  • The IOHK team and Runtime Verification have learned a huge amount from that model
  • From this, in short order, they should be able to productize this and they are on target and schedule for smart contracts
  • With Shelley, the release is going to come out little later than anticipated and now they hope it will come out as close to Q1 as possible
  • With Smart Contracts, it was always anticipated to come out somewhere around the first half or early second half of 2019, and this timeframe is still quite reasonable
  • There is still lots to do and more testing to be completed but the concepts like extended UTxO, how Plutus works, how to integrate Plutus and sidechains are already very well understood
  • This basically puts it in a good position to quickly move in the forward direction
  • Charles also addressed some other FUD that has circulated about the Japanese community, where claims have been made that investors in Japan have been locked out of their Ada
  • This is completely untrue as 100% of the people who bought Ada have access to it or were given access to it to redeem their investment and have liquidity
  • Those who are interested in this issue, can have a look at the distribution in the Genesis block, and see that the vast majority of the Genesis Ada have been moved, whether it was sold, traded or still being held
  • But to confirm, everyone has liquidity. And there were no special groups or tiers of investors at the original presale of Ada

Looking into the Future

  • Looking ahead, Charles is excited about the future
  • Decentralization, smart contracts and other features that have been in long arc R&D are now coming out in 2019
  • Additionally, he is excited about the progress being made at the newly resurrected Foundation and at Emurgo, as well as the Pan-African strategy which is also showing fruit
  • He also talks about the enterprise framework that will be rolling out in 2019 in Africa, which will bring people into our ecosystem
  • Here he also touches on the self-healing ecosystem of Cardano
  • He talks about when there were issues with CF, the first to bring these issues to the public were not treasured insiders but the Guardians of Cardano and third-party entities
  • This shows how Cardano is already very decentralized
  • And that there are many people who keep us accountable - there are community members who set up meetup groups to discuss the project, those who have Cardano podcasts, others who are involved in interesting development work as well as parties who are building their own explorers or wallets
  • In anticipation of the network launching, IOHK have received hundreds of emails with well wishes, advice and even constructive criticism. This is a sign of a healthy vibrant community
  • This is one that Charles has seen once before…with the Bitcoin community
  • He and IOHK believe firmly that our best days are ahead of us and Cardano is definitely is going to be a big project in 2019 as it has already been in 2018 and at its launch in 2017

More Housekeeping

  • At this point of the video, Charles touches on an update for IOHK about the work they’ve done with Ethereum Classic. If you are interested, please watch the video from here (timestamped).
  • In relation to the Cardano project, there is some synergy
  • The work on ETC has definitely helped IOHK have a production system that can be quickly repurposed to test Ethereum interoperability for smart contracts on our system
  • Having Mantis also made it easy to plug in the KEVM and IELE and run Solidity code
  • Had IOHK not had this, it would have been harder and more expensive to run these tests
  • Building that client trained our developers to understand how the Ethereum ecosystem works
  • This team literally started with nothing and started from the yellow paper and worked towards writing 100% new code. This proved to be a good exercise that was incredibly valuable in creating a knowledge transfer and bridging a skill gap to understand where Ethereum sat and to comprehend all the things it could and couldn’t do
  • It is easy to be overly academic and design an entirely new model, but it is harder to be pragmatic and learn from competitors of what they’re doing and where they’re going
  • This is what they gained tas a consequence of building that client
  • In the video, you will learn from Charles of the difficult decision they are facing in deciding when to stop contributing resources for this project. It should be noted though that he is incredibly proud of everything done to date and all the great effort the Scala team at IOHK have put in

Update about Cardano Foundation

  • Cardano Foundation recently appointed 3 new council members
  • These are interim members
  • The purpose for these members is to clean up the Foundation, build systems that have been lacking, and start up programs
  • They will also work to appoint a new, large, diverse board that represents the community
  • There will be an announcement about this arrangement at a later date

In Closing

  • 2017 was a hectic time in the crypto-sphere where there were many excited projects, and it didn’t matter if you made progress or not. You could be a copy and get funding
  • 2018 was a more “adult” year in that you saw lots of projects winnow out, products collapse, teams fall apart, and funding dry up
  • This process has separated the real from fake and we, at Cardano, have passed the test
  • Our project continues to grow, and we are still hiring, well funded and moving in the right direction
  • Though our approach that we’ve taken, through specification and peer review, is arguably very expensive in the short term, it is already paying dividends
  • It has given us lingua franca as an organization to talk about complicated concepts: ledger validation, how a wallet functions, smart contracts, how language will be utilized among professionals, businesses, scientists, lawyers, engineers
  • And as organization, given clarity on how these things will work at scale and can be put together; something our competitors do not have nor fully understand
  • This is adamant if we want this technology to get into more complicated systems (that have millions of users and require regular upgrades)
  • And in closing, while the past year has been hard and we will also have hurdles in the future, it has and will be worthwhile
  • What has made it worthwhile is the Cardano community as whole
  • All of you have wished us well, participated with us, suggested helpful advice, introduced cool ideas and helped spread our vision quickly

Cardano is made by you, the community. And we thank you for that!


Awesome summary @maki.mukai, it’s really convenient for people that can’t watch the whole video for whatever reason. Keep up the good work! :clap:t2:


Glad to help! If there are ever any suggestions on how to make these summaries better, please do let me know! :blush: