Cardano (ADA) co-founder Charles Hoskinson has refuted claims that Hydra, the layer 2 scaling solution for the Cardano blockchain, has been unsuccessful.

In an Oct. 5 video on social media platform X (formerly Twitter), Hoskinson revealed how Hydra has pivoted during the last three years and that measuring the network’s activity by transactions per second (TPS) alone might be misleading.

According to him, a single Cardano transaction can encompass multiple outputs, citing one instance where a block contained 384 outputs in just one transaction. He said:

“Cardano is not a TPS system. It’s a transaction-per-transaction system, and each of these outputs can signify more intricate elements such as scripts and proofs, beyond mere raw value transfers.”

Hoskinson further elaborated that Hydra has developed middleware for developers to build incorporates applications (dApps) for the blockchain network chain. This, Hoskinson explained, aligns with Cardano’s broader plan of supporting on-chain and off-chain applications like NFTs and decentralized exchanges (DEXs).

He said:

“So what happened over a three-year period is that Hydra pivoted a little bit and it pivoted into, let’s build some middleware that is going to be really easy for you as a developer to plug into your application work with Plutus to help get a lot of that complex logic that should not run on the main network but run it in a different network.”

Cardano DeFi TVL rises

Despite recent concerns, decentralized finance (DeFi) activity on Cardano continues to thrive.

According to data from DeFiLlama, the total value of assets locked (TVL) on Cardano has surged by over $10 million this month to $162.1 million as of press time. This growth mirrors the uptrend in DeFi activity on the network throughout the year as more traders embrace decentralized applications built on the blockchain.

It’s worth noting that the current TVL is still significantly below the all-time high of $326 million achieved last year.