BCGAME - Free 5BTC Daily Bonus!- Cardano is a blockchain platform based on peer-reviewed research.
- In a milestone for the platform, it launched smart contracts on testnet in May 2021, with a mainnet launch to follow later in the year.
Today, cryptocurrencies face a number of challenges, including scalability, power consumption, and the ability to interact with regular money.
Cardano calls itself a blockchain third generation audience. Its community is working to solve these problems and improve on its predecessors such as Bitcoin and Ethereum.
As of May 2021, Cardano is the fifth largest cryptocurrency by market capitalization.
What is Cardano?
You've heard of first and second generation Bitcoin and Ethereum cryptocurrencies, right? Cardano calls itself the “first third-generation cryptocurrency”. Like Ethereum, it aims to be a platform on which people can create smart contracts.
Charles, please explain the essential value proposition of Cardano in one sentence.
— Alex Hammer (@AIHammer) August 2, 2020
It was created by a team led by Charles Hoskinson, in an attempt to create a “more balanced and sustainable ecosystem” for cryptocurrencies. Originally developed as a research project, Cardano has evolved into a blockchain platform in its own right. Its creators believe that smart contract blockchains like Ethereum face challenges in terms of scalability and interoperability, and that these challenges can best be addressed by a new platform built from scratch.
Did you know?
The person most responsible for creating Cardano is Charles Hoskinson, who was actually one of the co-founders of Ethereum.
a short story
- Cardano started in 2015 as a research project to explore how cryptocurrencies could be improved.
- Cardano was released to the public for the first time on September 29, 2017 with the 'Bryon' stage, supporting only ADA transactions.
- The next phase, Shelley, was launched in July 2020. It improved the network's decentralization and meant that incumbents could participate in the ADA.
- The third stage, Goguen , will add support for smart contracts and native token issuance. The deadline is August 2021.
- The final stages are Basho, which focuses on scaling, and Voltaire, which deals with chain governance.
Did you know?
Cardano names its main product milestones in honor of famous English poets. The network ended the phase of Byron and Shelley and is now in the Goguen era.
What is so special about Cardano?
The team behind Cardano was inspired by the world of scientific publishing and adopted its peer-reviewed approach to its cryptocurrency.
What does that mean? Well, all the changes and new features introduced are developed, reviewed and agreed upon by academics before they are used, including the network consensus algorithm, Ouroboros (which later on). The network's code is written in the Haskell programming language used by companies such as Bank of America and AT&T. And IOHK, the company behind Cardano, has published a series of academic articles describing the platform and its technology.
But that is not all!
The Ethereum network currently uses the proof-of-work consensus mechanism to verify transactions, which uses a lot of electricity and can only process a limited number of transactions at once. Cardano uses proof of betting, which consumes less energy; the network uses an algorithm called Ouroboros to choose who creates the next block and to validate the blocks. (Ethereum is working to switch to proof of betting as early as the end of 2021.)
Proof of participation advocates believe that a stake-based consensus mechanism makes blockchain networks safer while significantly reducing their energy consumption and carbon footprint.
If we get it right [in the betting test], the network will be 250 times more decentralized than Bitcoin.”
Cardano developer IOHK has already advanced in identity and traceability management, announcing a series of partnerships; in 2019, IOHK partnered with shoe manufacturer New Balance to combat counterfeit sneakers, allowing customers to confirm the authenticity of products using the Cardano blockchain. In April 2021, the company partnered with the Ethiopian government for an identity solution to be implemented in schools.
Ultra-fast transaction speeds and interoperability with other block chains are also under development.
Did you know?
Cardano's coin is called the ADA after Ada Lovelace, a 19th-century mathematician recognized as the first computer programmer and daughter of the poet Lord Byron.
What else is different?
Cardano has three parts:
- Cardano Foundation – supports the network's research and development.
- IOHK – a company that works together with several universities in research and development.
- Emurgo – a separate company hired to work on the blockchain and make it attractive to companies.
How is the ADA produced?
Cardano's ADA currency is not mined like Bitcoin. Instead of miners, there are validators, which are chosen by the network depending on how much ADA currency they currently have.
If they are selected to validate transactions in the block, they bet on how confident they are that they can verify all transactions. If the blockchain checks the validator's lock, they effectively win the bet and receive an ADA reward.
What is Ouroboros?
Ouroboros is Cardano's definition algorithm, the first blockchain protocol based on peer-reviewed research, and the project's solution for proof of bet.
Essentially, consensus protocol is behind Cardano's ability as a decentralized betting proof platform. It is used to secure network, validate transactions and gain newly created ADA.
Ouroboros divides transactions into epochs, which are subdivided into time intervals. A slot leader is elected for each time slot and is responsible for adding a block to the chain. A new slot leader is needed to consider the last blocks in the received chain as transient. This is known as “delay in settlement” and is the mechanism by which the reason is securely transmitted between participants.
How do you get ADA?
As one of the top 10 cryptocurrencies, Cardano's ADA is available for purchase or trading on most major exchanges including Coinbase, Binance, Kraken and eToro.
What can you do with Cardano?
While you can buy and trade ADA like any other cryptocurrency and use it to pay for blockchain transactions, it is not considered in the same way as a currency like Bitcoin, which can be used to buy goods and services.
On the Cardano platform, users need to buy ADA to make transactions, participate in governance, become a slot leader and earn a share of fees paid for transactions.
"[Cardano] really does the things we've always wanted to do in cryptocurrencies, which is build a financial operating system for people who don't have one — one that can really compete with a global financial system."
In July 2020, the Shelley update enabled delegated stakes. For the first time, ADA owners were able to pool their coins with other users to earn the cryptocurrency.
The future
ADA mining consumes a fraction of the energy it costs to produce Bitcoin – so Cardano was one of several cryptocurrency trials in play to benefit from a new emphasis on greener credentials for crypto, after Tesla CEO, Elon Musk, highlighted the issue in May 2021.
A crucial next step for the platform is the launch of smart contracts, which were launched on the Alonzo testnet in May 2021 and are expected to go live on the Cardano main network in August 2021.
It is an important milestone for Cardano, with smart contracts forming a key component of rival lockout chains such as Ethereum and Binance Smart Chain. They are also essential for building decentralized applications ( dapps ), such as those used in the growing ecosystem of decentralized finance ( DeFi ).
If Cardano can prove that her rigorous approach to cryptocurrencies can bring big business to the blockchain world, she could find herself at the forefront of a cryptographic revolution for years to come.
