The Shelley phase was the second of five phases in Cardano’s development roadmap.

It aimed to transform Cardano from a proof-of-stake (PoS) blockchain with limited functionality to a fully decentralized and scalable platform with smart contract capabilities.

Objectives of the Shelley Phase

1. Decentralization

The primary goal was to increase Cardano’s decentralization by implementing a stake pool system.

This allows anyone to participate in the network by staking their ADA tokens and validating transactions, reducing reliance on centralized entities.

2. Scalability

Shelley introduced several features to improve transaction throughput and network capacity, such as pipelining and the Ouroboros Hydra protocol.

These advancements aimed to accommodate a larger user base and enable complex applications.

3. Smart contracts

Shelley enabled the deployment of smart contracts on Cardano, paving the way for decentralized applications (dApps) and innovative financial instruments.

4. Improved user experience

The phase aimed to simplify the user experience by introducing staking pools, wallets, and other user-friendly tools.

Key Features of the Shelley Phase

1. Stake pool system

Users can delegate their ADA tokens to stake pools, which validate transactions and earn rewards in return.

This incentivizes participation and distributes power across the network.

2. Cardano Shelley wallet

The official wallet for staking and managing ADA tokens within the Shelley phase.

3. Shelley’s ledger

A new ledger system with improved efficiency and scalability compared to the previous Byron ledger.

4. Hard fork event

The Shelley phase was implemented through a hard fork in July 2020, significantly upgrading the Cardano protocol.

Impact of the Shelley Phase

1. Increased decentralization

Cardano’s score has significantly improved since the Shelley phase, making it a more secure and resilient network.

2. Enhanced scalability

The network’s transaction capacity has increased, paving the way for further growth and development.

3. Emergent ecosystem

The Shelley phase facilitated the development of a vibrant ecosystem of dApps and DeFi protocols on Cardano.

4. Attracted developers and users

Cardano’s improved features and functionality have attracted developers and users, contributing to its growth and adoption.

Current status

The Shelley phase was completed in February 2021, and Cardano has since entered the Goguen phase, which focuses on smart contracts and decentralized applications.