Cardano’s first DEX launched on the mainnet to allow traders to make swaps and increase liquidity, but network congestion has hindered transaction processing.
SundaeSwap, Cardano’s first decentralized app (DApp), has launched but is creating customer irritation owing to congestion, platform problems, and failed transactions.
Is it simply a case of predicted teething problems caused by an inflow of eager consumers, or is there more to it?
SundaeSwap is a token-staking and decentralized exchange (DEX) platform. Its mainnet launch on Thursday represented a watershed moment in the Cardano ecosystem because it was the first DApp to use smart contracts.
The price of Cardano’s ADA has risen by 50% in the week leading up to the debut of SundaeSwap, indicating that a successful launch is a high-stakes game for Cardano.
On Thursday, trading on the DEX began at 9:45 p.m. UTC. Users on the project’s Discord server began complaining about failed transactions and network congestion in less than two minutes.
SundaeSwap CEO Mateen Motavaf wrote a statement in strong font and all caps at 10:07 p.m. UTC, attempting to address the multitude of complaints on the server:
“YOUR ORDER WILL BE PROCESSED IF IT IS ON-CHAIN.” PLEASE BE PATIENT AS ORDERS FAIL DUE TO CONGESTION.”
At around 1 a.m. UTC, the SundaeSwap team held a Twitter Spaces AMA to discuss any concerns that traders were experiencing with the platform. Given the massive backlog of orders clogging up swaps, or “scoops” as they’re known on SundaeSwap, one user wondered what the impact of an anticipated Cardano node upgrade would be. Matt Ho, chief technological officer, responded:
“Once the upgrade takes effect on the 25th, we expect more than a 2X boost in throughput from the memory bump alone as additional protocol parameters become available.”
Another user discovered that an order was filled on the DEX before it was published on the website. A technically knowledgeable trader can avoid the website user interface entirely and make trades directly on the underlying smart contracts for any DEX.
“There were so many things to deal with,” Ho explained, “that we didn’t imagine maybe, in our naivety, that someone would have constructed a transaction by hand ahead of time.”
Users were still complaining about failed transactions and orders that had been pending for more than four hours at 2:40 a.m. UTC. “Orders will continue to be processed (currently approximately 2500 orders per hour; currently 11k orders on chain, 1600 of which are within slippage tolerance,” said chief investment officer Pi Lanningham on Discord.
Based on the results of the testnet around a month ago, the project’s core team anticipated a substantial backlog of orders ahead of the launch. The team noted in a blog post on January 8:
“We want to assure you that, while orders may take several days to process, all orders will be processed fairly and in the sequence in which they were received.”
Using the SundaeSwap platform’s performance from a previous test phase, the team acknowledged the likelihood of poor performance at first, but stated, “We’re pretty optimistic that the protocol can meet the usual day-to-day load until things settle down.”
Following the Alonzo hard split last September, the Cardano blockchain added smart contracts to the network. Over 2,000 smart contracts were deployed on the blockchain with a timelock in one week without becoming operational.