What is the plan to simplify token transactions?

Right now, when you want to transfer any token, you have to create fairly complex transaction in which you also have to send at least 1 ADA to whoever you send the token. I know very well why the current system works like this - eg. tokens are just transferred as part of the UTXO and min UTXO size is 1 ADA and therefore you must always create new UTXO of at least 1ADA in size when you want to transfer token.

All that is clear to me, as to someone who is well familiar with Cardano under the hood - but that doesn’t change the fact that this is terrible from user perspective. Most of users will not want to spend ~1.5ADA for a simple token transaction, even if that 1ADA from TX ends in target user wallet.

From newbie perspective this will be looking overly confusing or simply too expensive. What is the plan to mitigate this? Other chains already offer superior models where you can directly transfer only tokens you want to transfer and nothing else, except for tiny fee in native token. How is Cardano planning to solve this? What is the roadmap?


When users receive NFT they get that ~1.5 along with the token, so it is not coming out of their original ADA balance. The only thing they add when sending a token is just Tx fees.
As an CNFT collector I never had an issue with those coins being required for transaction. It’s still waaaaay cheaper then gas fees on other networks.
Also, one of the reasons they have it at 1 ADA+ is to prevent spam of tokens on the network, which is a great idea.

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yes but when YOU send any token, be it NFT or coin to other wallet, you have to send that extra 1ADA. Imagine you had to send 1ETH to everyone you want to send anything to on ethereum blockchain, do you think ethereum would ever be a success if that was the case?


Yes. So you send that one ADA you got for free when you received a token. You are not loosing anything. I have over 400 transactions in my wallets at the moment and most of them are CNFTs. You don’t even feel it since exact amount of ADA you get when you purchase a token is what you send out when you sell or trade a token.

Would you not view this as a possible threat to the adoption of Cardano, if token transfers require a receiver’s fee of at least 1 Ada? This may not be an issue currently but given Ada’s deflationary nature it should become an issue.

However, since this is not “lost” money it is not a problem of the same dimensions as on Ethereum - I guess it could be solved with something as simple as some escrow script to send coverage from the receiver upon transfer. I agree with Adaseal’s concern though, if a medium or a secondary transfer has to be used for the successful transfer of tokens without a deficit - it is a matter of concern, which could be impacting the growth of tokens available on Cardano.

As an ending note, I’d much rather prefer 1 Ada(~$2 - take $10 even) than the ~125 - 500 $ gas fee on a $25 gain when using Ethereum apps though.

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There is no receiver fees. Sender has to attach some ADA in order to transfer any digital asset trough a Cardano network. At the moment this is around 1 ADA. This is just a number currently used and can be lowered/ increased as needed in a future.

This would be unnecessary step. Most of people that sell CNFTs already include any costs into the price of a sale. Any escrow would just create multiple unnecessary transactions and end up costing extra unnecessary Tx fees.

I’m trying to see your point from your perspective here, but I’m just failing to see the issue here. There is no need for equalizing secondary transfers in any scenario I can think of. Once the price is set and paid that concludes the transaction.

The receiver’s “fee” was meant as a term for the ADA used to process the transaction, but given your clarification - it makes sense, I was under the impression this amount was set with a lower boundary of
As with the rest of the post, these were just ramblings over the inefficiency and strange solutions required to circumvent this “boundary”. However, this is an interesting concept - is the sender able to attach additional ADA to a token transaction?

I forgot to mention this, but I was attempting to give my newbie insights into how I viewed it - as OP mentioned being “well familiar with Cardano”.

Here is a surface overview of how digital asset transactions work on Cardano (with out technical detail).

Imagine Cardano network as a sea and ADA as rafts or boats that are needed to travel that sea.

In any transaction you have a Sender and a Receiver.
Sender is responsible for creating a whole trip. So, Sender will choose the destination (Receivers wallet address). Then they will choose which digital asset to send. To send that asset they have to build a raft from ADA that can carry that asset to Receiver. Currently the size of a raft is Base ADA + ‘Asset size Modifier’. That means larger the code of digital assets larger the amount of ADA needed to send it.

Lets say for example the size needed to send is 1.7 ADA. Then the Sender will choose destination (wallet address), Attach digital asset and add 1.7 ADA to that transaction to carry that asset. After clicking SEND and entering spending password the Sender will pay a small transaction fee (around 0.3 ADA) to Cardano network.

Then the Receiver will receive digital asset along with raft need to carry that asset of 1.7 ADA.
The Sender can choose to send any amount of ADA that is 1.7 or higher if they choose to.

If Sender wanted to make sure to have a profit of exactly 100 ADA from this transaction, then all they have to do is add 1.7 ADA raft cost and 0.3 ADA transaction fee to the price. So price would be 102 ADA to clear exactly 100 ADA from this transaction. That simple. :smiley:

Now, if you wondering why there is a need for a raft. That is because if transactions were free and there was no cost to create and send digital assets, then a bad actor could create infinite assets and send them all over the network causing network to fail due to transaction overload. And the reason why size modifier to raft building is there, because bad actor could create huge digital assets instead of infinite digital assets to clog up the network.

These ‘raft fees’ are there to prevent misuse of digital asset creation and transactions. They are kept to be negligible for individual, but costly enough when scaled up to deter bad actors.

Also, ‘raft fees’ is just a term I made up for this example, not an actual term used. :wink:


Thanks for the detailed explanation, it helped me correct my understanding of the subject.

I was not aware of the mechanic also being used to provide the economic incentive (Assumed second fee), but I must admit, that is a genius implementation of a security mechanism, given that it essentially also provides the framework for debt collection/credit contracts by default.

The analogy with the “raft” explains it very well. You can also read more about it here:


guys you keep talking about NFT here, but this applies to all tokens. That means even when you want to transfer some stablecoin or anything else, for every single transaction. Imagine someone needed to send many of these transactions, perhaps on regular basis. Then this will start being a problem. If 1ADA start being too “expensive”, then there will be high incentive for each sender to get it back. This does complicate things.

Just look at your lengthy explanation with rafts aimed to people who don’t understand how Cardano works on the background - is this the explanation that is going to be given to everyday Joe’s every single time you will need to teach them how to transfer tokens? This explanation is long and complicated, because the underlying mechanism is unnecessarily complicated, compared to just “specify amount of token, specify target address and provide a fee” that other protocols need.

If we want wider adoption of native tokens on cardano blockchain, we need to simplify the user experience, otherwise cardano is unlikely to win in this area.

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I understand what you feel, hopefully in the future the costs like what you mean can be resolved soon at Cardano.

If 1 ADA starts being to expensive they will just lower the fee. this is just currently selected protocl parameter that can be changed any time. When ADA hits $10 it can go to 0.1 ADA, when ADA hits $100 it can go to 0.01 ADA. Not an issues and it can be changed quickly.

There is a learning curve to anything new. When internet was just becoming a thing people used to complain that it was too complicated for common people and that there will be no need to make it publicly available and that it will be used only for businesses. They said the same thing about personal computers. As time passes the concepts will become familiar and widely understood, until then explanations will be needed. Back in early 90’s nobody heard of smartphones and Wi-Fi, now it’s hard to find someone that hasn’t heard about or used either of those. This is a normal process of adaption.

If Cardano ever stops using ADA as a ‘raft’ for all non ADA transactions I will sell all my ADA and all my Cardano NFTs and tokens and leave the network before it becomes a dumping ground for spam, scams and garbage. There has to be a cost, otherwise anyone can just use the network with out ever contributing and they can attack and black mail the network or individual wallets at will with no repercussions.

Since these rules were implemented after Mary hard fork in March there have been over 1.7 million tokens created on Cardano and daily transactions on Cardano network grew by 200,000%. That’s 2000x multiple. I call that a win. TxPerDayIn1000s

Yeah, I’m not convinced by any of this.

If I want to send an asset to a person, I want to send only that asset. Not “that asset plus one ADA, it’s no big deal lol”.

nobody is giving out free ADA coins, if someone tells you that it’s probably a scam, be careful out there.

Read up on Babel Fees.

Bable Fees will allow transactions to be paid in the native token, but will requires liquid market in that asset and/or SPO that wants to settle in that token. It’s a very important concept that will be material in Cardano’s adoption and growth in the coming years.

For now the requirement for ADA to be transacted is an important security features as others have noted.

I don’t see how babel fees go over 1ADA min UTXO size, they only deal with actual fees, not the mentioned problem

I completely understand what you are talking about.

It seems there is some confusion so I will clear it up as someone who is currently down 15,000 ADA (FIFTEEN THOUSAND) just from “sending” transactions.

We have a Native Token that we are currently Airdropping to individuals based on their activity on the site. Each and every time we want to Airdrop ANY number of tokens to a wallet WE, as the SENDERS also have to send 1.44 ada to the wallet that is receiving the Native Tokens. We have Airdropped to well over 10,000 wallets.

As you can imagine We have to SEND 1.44 ada x 10,000 that is 14,400 ADA sent to wallets as part of an Airdrop that we will NEVER get back.

It DOES cost to send a Native Token and with high volume transactions such as ours we are seriously rethinking using ADA as the blockchain, We are currently exploring a less cumbersome alternative. I think others have seen this and ada’s low price and continued decline in price is a direct reflection.

We will wait for the Cardano DEX’s first to see if the issue is resolved but if not, we will literally go broke giving away our 100 million tokens during our Airdrop period.

NOT going to happen.

Not true. But see my comment in this thread first.

I was replying to deleted comment by someone who was talking about some possible scam