The Reality Behind Cardano's High Finality Time

Added: 2026-05-12

[00:00:00]Pavel Durov, which is the founder of Telegram and also the TON blockchain, he posted a video on Twitter that shows finality time of major layer one blockchains. And it shows that TON is at the top, and he said specifically that TON leads the layer one blockchains in terms of finality time.

[00:00:21]And he put Cardano at the very bottom, just below Bitcoin. Now, since he put Cardano at the bottom, of course, you know, it doesn't really show a good image of Cardano.

[00:00:34]And it's obviously unjustified. It doesn't have a one-day finality time.

[00:00:39]You can't just say that it has a one-day finality time. You will notice that just after Pavel Durov posted this, we had the Algorand Foundation who came in with their own version of that very video, and they put Algorand on top of the TON blockchain. And right afterwards, Sui community came in with their very own video, and they put Sui at the top and they removed Algorand. And they're all using different numbers. So, everyone is being very subjective about it. They're not being clear what the actual finality time is. So, it is important that we understand what finality time is, why Cardano is at the bottom. Now, it doesn't exactly have a one-day finality time, but it is true that Bitcoin and Cardano has a higher finality time because they uses a completely different approach that we are going to discuss uh in this very video. But before we discuss that, we have to discuss what finality time actually is. So, here's a quick explanation. Now, when anyone transact on a blockchain, let's talk about Cardano. When someone makes a transaction on the Cardano blockchain, the stake pool operators, the node operators, they confirm that transaction, they produce a block, and it is put on the ledger. Now, once the first block is produced that contains that very transaction, that is called confirmation.

[00:01:58]Now, this is the stage when you can see your transaction on the block explorer.

[00:02:03]And for Cardano, this happens in about 20 seconds.

[00:02:09]Now, the next stage is the settlement or practical finality. Now, this is when more blocks have been added to the ledger after this block. And this is the stage that is considered safe for practical use.

[00:02:26]Now, if you make a transaction and there's only one block, DApps and exchanges on Cardano, they won't actually consider the transaction, you know, uh finalized.

[00:02:38]What they will do is they will wait for at least 10 to 20 more blocks to be produced after the first block.

[00:02:45]And that is when they will consider that the transaction has taken place and they will go forward with it, which is called the settlement and also practical finality, which I'm going to explain what this is.

[00:02:57]And this happens after 10 to 20 blocks, which for Cardano happens in about 5 to 8 minutes.

[00:03:05]And the final stage is finality, which all these blockchains have been talking about.

[00:03:11]Finality is basically a phase which, if a transaction has, you know, uh reached finality, that is when that transaction cannot be reversed.

[00:03:24]So, in blockchains, we have this concept of chain reorganization, where you can actually, in one way, reverse the transaction by creating a competing chain, getting more, you know, stake to validate transactions and add more blocks. If you add more blocks than the main chain, the network actually switches to the other chain, which does not have your original transaction. That is a concept called chain organization through which you can actually reverse a transaction. Finality is the stage which if a transaction has reached this stage, it cannot be reversed. Theoretically, it becomes impossible to be reversed.

[00:04:04]And that is what this whole debate is about, finality time. Now, here's where things become really unfair for Cardano because there are two approaches to finality. We have probabilistic um finality and then we have deterministic finality. All these blockchains that are on the top of the list here um in terms of finality time, they uses deterministic finality. We have XRP Ledger, we have Solana, we have BNB Chain, we have Algorand, we have Ton, we have There are, you know, Aptos, we have Sui. All these uses deterministic approach, deterministic finality.

[00:04:44]Ethereum uses a hybrid approach that uses deterministic but also probabilistic. And we have Cardano and Bitcoin that uses the probabilistic uh finality. And that is why Bitcoin and Cardano has a higher finality time. But this doesn't mean it is bad.

[00:05:02]This approach is far more secure. It doesn't have speed, yes, but it has much more security and much more decentralization.

[00:05:12]So, you have three parameters in blockchains. You have decentralization, you have speed, and you also have security.

[00:05:20]Cardano emphasizes on decentralization and security over speed. And all these blockchains that you're seeing having a very good finality time, they prioritize speed over decentralization and security. And that is the key difference here.

[00:05:37]Now, for Ton, since they have the Telegram, you know, application, social media platform, and they have all these, you know, play-to-earn games like we have that Hamster Combat and so forth, they require transactions to be fast.

[00:05:52]They want transactions to be instant.

[00:05:54]That's what they require. And for this, this deterministic approach is pretty good.

[00:06:00]Cardano emphasizes decentralization and security. That That's what we have talked about multiple times before. For this, probabilistic approach is much better. Now, I'm going to explain the difference between the two, but let me erase the chart and add new stuff to it.

[00:06:14]Now, there are a lot of difference between the probabilistic and the deterministic approach. But, we're going to talk about the major difference here and keep things very simple. So, what happens in probabilistic approach is you want to achieve finality. And the way that you achieve finality is once a transaction play takes place and the block is added on the ledger, and when more blocks are added, it becomes more and more difficult to reverse the transaction. And it reaches a point it reaches a stage where it becomes theoretically impossible to reverse the the transaction.

[00:06:49]For Cardano, it happens after 2,160 blocks are produced. That is when, you know, in Cardano, you can achieve theoretical finality, which is guaranteed by the protocol.

[00:07:04]But, you have this practical finality, which you can achieve after 10 to 20, you know, blocks are produced, which is the standard that most DApps and exchanges uses. After which, they deem a transaction safe enough to be, you know, used. Now, in probabilistic, this finality is achieved gradually. Uh as more blocks are added, it becomes more and more secure until it reaches one stage when it becomes theoretically impossible to reverse the transaction.

[00:07:33]Now, in this case, you have higher security. I'm going to explain why there is and it has decentralization, which is one of the most important factors here.

[00:07:41]In deterministic, what happens it happens instantly and the way that it happens instantly is all the validators, all the the node operators that are validating the transactions and they're producing newer newer blocks, they are the ones who vote for this finality to happen. Now, if 2/3 of the validators vote explicitly to finalize the transaction, it is deemed final and that is when you reach finality. Just alongside this process of validating the transactions and producing more blocks, they also do this vote and through which just when you receive the first confirmation, you also achieve finality.

[00:08:19]And that is why this approach offers you deterministic finality.

[00:08:24]In probabilistic, like we explained before, when newer and newer blocks are added and more blocks are added after the very block, that is when it is finalized.

[00:08:34]Now, the reason this one is more decentralized than deterministic is because in case of Cardano, we have almost 60% of the supply that is staked.

[00:08:46]We have thousands of stake pool operators or SPOs that are validating the network, that are uh validating the transactions, that are producing more blocks. And because of that, if you want to reverse a transaction, you would need this very amount of all these stake pool operators.

[00:09:08]You would need to produce more blocks than they are, which becomes way too costly that it becomes impossible for you to do that, for anyone to do that, uh especially in the stage that we are in. And that's make it very decentralized. Even if majority of the validators here collude, they can't do anything. Uh the network won't be affected even if there's slow activity, it won't be affected. And that is the benefit that Cardano has with this.

[00:09:35]With deterministic finality, what happens is if 1/3 of these validators, if you have less validators and 1/3 of them collude and break the rules, that is when you can theoretically reverse the transaction.

[00:09:56]And that's why it's not safe. Now, if you have a lot of validators, it will become difficult to get 1/3 of them to agree to break the rules. Of course, they wouldn't want to do that. But if you have less validators, it becomes possible for these validators to collude and eventually break the, you know, the break the rules. And that is the problem that we have in this approach. There are concerns of centralization, and with centralization, you get these sort of risk.

[00:10:26]So, that's the difference between deterministic and probabilistic. Now, I'm not saying that deterministic approach is not safe. It actually is safe. It is, I would say, in most cases, better than the probabilistic because you have instant finality, you have you have speed here. And this thing that we're talking about is not easy to do this. It's pretty difficult.

[00:10:49]Uh of course, in probabilistic, it becomes even more difficult. And one of the example here is Bitcoin.

[00:10:57]Now, there has been cases of um reversals in Bitcoin, but they happened 12 years ago.

[00:11:08]When of course, there was less hash power. And in that case, it is possible for, you know, bugs to happen. And there were two cases in Bitcoin that happened.

[00:11:17]I think one happened in 2010, and one happened in at around 2012. Um one was a bug, and uh the other one was a possibly an exploit. That was when Bitcoin was new, there was less hash power. And when it was increased for over 12 years, there hasn't been a single case of reversal.

[00:11:41]Now, this is battle tested. This is proven by time.

[00:11:45]And we have talked about how Cardano, you know, uses a lot of the similar technology than Bitcoin. We have the, you know, Bitcoin uses the UTXO model, Cardano uses the extended UTXO model.

[00:11:58]Both Cardano and Bitcoin, they use the probabilistic approach, you know, which by the way, majority of the blockchains that we have, the layer one blockchains, they uses the deterministic approach.

[00:12:09]So, here's the key point here.

[00:12:11]Both are in in some way secure. Of course, deterministic is much faster, but there are risk of centralization. Uh in probabilistic, there are, you know, it's also secure. The more time that is put in, more blocks are produced, it becomes more and more secure. But of course, it is gradual, it takes time, but you don't have centralization risk here. And that is the benefit that you get with this one.

[00:12:37]Now, it all comes down to your approach.

[00:12:40]What use cases do you expect for your blockchain to have? If you want applications that wants instant finality on your blockchain, of course, deterministic finality is the way to go.

[00:12:50]But if you want it to be, you know, if you want to prioritize governance, and that is your core model and fundamentals, which in this in the case of Cardano, that that is what our fundamentals are, that's when you go for probabilistic.

[00:13:04]Now, this is by choice. Cardano has a high finality time, not because, you know, it has a inferior technology. That finality time is by choice. By the way, it's not 1 day, it's actually much less than that. If you want to reach the ultimate theoretical finality, that takes about 12 hours, but it can also take 36 hours. But we're We're about the theoretical finality here. We're not talking about practical finality here, which is what most DApps and exchanges use. That finality happens in about 5 to 8 minutes. And we're having this prowess upgrade, I think, in this very year, which is going to improve this practical finality time from 5 to 8 minutes, and it's going to improve it to about 2 to 5 minutes.

[00:13:49]So, that is going to happen, I think, in this very year.

[00:13:53]But, yeah. Now, if you take a look at that video, of course, it doesn't do justice with Cardano. It doesn't have a 1-day finality time. You're talking about the theoretical finality there.

[00:14:03]And even in that, it ranges between 12 to 36 hours. So, it's not justified to put these blockchains in one video when they have completely different approach.

[00:14:14]It's like you're having a cars race, 1 km, but on one end you have an EV, which accelerates faster. So, if the distance is less, of course, the EV is going to win. But, if you increase the kilometers, let's say, a 10-km race, of course, a fuel engine, which eventually reaches a much higher top speed than EV, of course, that will take the lead there. So, it depends on the the race, obviously.

[00:14:40]And that's why it's not justified to put them in one category. So, I think that explains what the finality is, how Cardano operates, how putting Cardano at the bottom of that list is not justified.

[00:14:55]Um but, yeah. Let me know your thoughts in the comment section. And by the way, I am switching to cold storage, and I'm going to use the Tangem wallet. They They have their very own cold storage, and they were kind enough to send me this one. It's not going to be a sponsored or a promotional segment. I mean, they gave me to use it, and it's up to me if I want to talk about it.

[00:15:17]But, I'm going to try it out. I already have set it up. And once I give it a try for almost a week, I'm going to make a video on it. So, if you want to try Tangem yourself, uh make sure that you use my link that will be in the description. You will get 10% discount on there. So, I'm going to put the link in the description if you want to use that. Um make sure that you use my link to get it because of course you get a discount.

[00:15:40]And yeah, I'll see you guys in the next video shortly. So, stay tuned.