There is a renewed interest in the Tezos ecosystem as of late. Since the release of the Tenderbake testnet, the community has been abuzz with excitement. This testnet marks another crucial milestone for the Tezos ecosystem a sit keeps growing and evolving.
A New Consensus Algorithm
For those who are unaware, Tenderbake is a new consensus algorithm proposed by the Nomic Labs team. It is the result of global collaboration between academic researchers and engineers capable of implementing their ideas. Although there is still a lot of testing to do, Tenderbake seems closer than ever to becoming a viable protocol for the Tezos ecosystem. Its performance will require further optimization, and there may still be some implementation errors, however.
As is often the case in this industry, one does not simply replace a consensus algorithm with a better one. The Tezos ecosystem relies on Emmy+ at this time, yet the introduction of Tenderbake may be a matter of time. Having the ability to handle arbitrarily large amounts of validators can prove beneficial to the broader ecosystem.
The crucial benefit of this new algorithm pertains to chain forks, should they ever occur. For most blockchains, a chain fork will result in a network split, creating great problems for all users and service providers. This new algorithm is capable of resolving chain forks after two blocks, providing better peace of mind. Additionally, Tenderbake can boast shorter block times and faster finality than Emmy+, making the network more robust and versatile.
It is safe to say that Tenderbake may be one of the most significant Tezos upgrades since the network’s inception. The developers have put together fantastic upgrades and enhancements over the years, but this new consensus algorithm will make the network more competitive than ever before. Most of its success will hinge on the current testnet phase and whether the implementation can occur smoothly.
Long-Term XTZ Outlook
Most people who learn about upcoming technical upgrades for a cryptocurrency project hope to see a price impact sooner or later. For Tezos, the past year has proven relatively successful, thanks to XTZ gaining 234.7% in value. However, the momentum seems to be stalling a bit, which can trigger minor market volatility. It is too early to tell if Tenderbake will have a price impact, as the technology has yet to be finalized.
That said, most major network upgrades tend to provide long-term benefits to an ecosystem. Faster blocks and finality are two main benefits to look out for in this case. Currently, it is unclear how long the testnet phase will last, albeit it is safe to assume the developers will avoid any risk-taking. The future looks exciting for Tezos, although that won’t automatically impact the XTZ price.
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