Glossary
Hydra (Cardano)
Cardano's Layer-2 scaling solution — isomorphic state channels where a small set of participants runs an off-chain ledger using Cardano's own EUTXO and Plutus model.
Hydra is Cardano's flagship Layer-2 design. A Hydra Head is an off-chain state channel among a small group of participants who share an isomorphic copy of Cardano's extended-UTXO ledger — including Plutus contracts. Transactions among the participants settle off-chain at the participants' speed; final balances close back to mainnet when the head closes.
The "isomorphic" property is the key idea: anything that works on Cardano mainnet works inside a Hydra Head without porting. The design targets use cases where a known group of parties want high-throughput interaction (gaming, payment networks, exchanges) without exposing each step on L1.