The Cardano network allows you to submit a transaction for which you pay an average of 0.17 ADA. This is the fee for the transaction to be verified by all Cardano nodes and stored forever in the blockchain. It can take several tens of seconds to get the transaction into a block, which is a very long time for a regular financial transaction. The Hydra Head protocol is the basis for creating a second layer for Cardano that will enable sub-one-second settlements, low-to-near-zero fees, and reduced space requirements on the blockchain. The biggest benefit will be a significant increase in scalability.
- The Hydra Head protocol will allow the creation of a parallel network that will process user transactions in an off-chain manner.
- The Hydra consensus is based on the agreement of all participants to the newly proposed state of the EUTXO distribution.
- Isomorphism allows using the same EUTXO, transaction format, Plutus scripts, and signatures as used by the Cardano network.
- The SundaeSwap team showed a demo with their DEX on Hydra.
This article was prepared by Cardanians with support from Cexplorer.
Read the article: https://cexplorer.io/article/how-the-hydra-head-protocol-will-work