An Assessment of UTXO Smart Contracts: Towards Optimized Application Development on Cardano

Abstract

This thesis provides a detailed assessment of the UTXO Cardano blockchain smart contracts. It highlights how the UTXO (Unspent Transaction Output model differs from traditional account-based structures in other blockchains like Solidity Ethereum. Cardano is recognized as a leader in blockchain technology due to its strong focus on scalability, security, & sustainability which allows for the creation of reliable decentralized applications. Certain programming languages are employed to develop smart contracts. Moreover, this paper examines Aiken, a functional programming language used on the Cardano platform for creating smart contracts. It explores how Aiken contributes to developing decentralized solutions. This research gives a clear understanding of managing UTXO smart contracts on the Cardano blockchain with Aiken & Lucid. Aiken is a functional programming language used to write on-chain smart contracts on cardano. While, Lucid is an off-chain framework built on JavaScript and TypeScript which is used to interact with on-chain smart contract script. These tool simplify the development process on cardano by effectively address challenges that come with creating transactions and handling on-chain smart contract scripts. The thesis offers a practical case study. It examines an auction application that demonstrates how these technologies work together to build a real world application. By using Aiken smart contract code and using Lucid to interact these smart contract script, this example illustrates how to lock funds within a smart contract, place bids, and later retrieve those funds. The case study acts as a clear, step-by-step guide. It assists managing transactions and UTXOs on the Cardano blockchain. It is important to understand how off-chain components function interact with on-chain scripts while creating UTXO smart contracts on Cardano. This study also discuss a number of growth potential. It also offers insights into the advantages and difficulties of this strategy. The main objective of this thesis is to increase the understanding of creating and maintaining UTXO based smart contracts on the Cardano network among researchers, developers, and blockchain enthusiasts.