Cardano is one of the biggest cryptocurrencies at the moment as it is in top ten overall according to coinmarketcap. It was designed to be an evolution of the Ethereum, and many people think it indeed is better than Ethereum. ADA has been a top 10 cryptocurrency by market capitalization since its release in 2015, and has garnered significant hype and attention. So why all the buzz for Cardano? Here is everything you need to know about Cardano.
What is Cardano?
Cardano calls itself a next-generation blockchain that is a flexible, sustainable, and scalable platform for running smart contracts, which allows the development of a wide range of decentralized finance apps, new crypto tokens, games, and many more. Like Ethereum, it is a platform where people can create smart contracts, and in turn, create decentralized applications and protocols.
ADA is the native cryptocurrency of Cardano. It is named after Ada Lovelace, the 19th-century mathematician that is often referred to as the world’s first computer programmer. The ADA cryptocurrency runs on the Cardano blockchain, a first-of-its-kind decentralized network, based completely on scientific and mathematical principles designed by experts in the fields of cryptography and engineering.
History of Cardano
Cardano began in 2015 as a research project to explore how cryptocurrencies could be improved but was launched in 2017 by Ethereum co-founder Charles Hoskinson who wanted to create a third-gen blockchain (blockchain 3.0). Cardano aims to be a highly scalable and energy-efficient smart contract platform. Cardano has a distinctive two-layer structure, and the network makes use of a proprietary adaptation of Proof-of-Stake (PoS) consensus called Ouroboros.
What Problem Does Cardano Solve?
Cardano’s goal is to solve many of the blockchain industry’s current problems, some of which are:
-A consensus mechanism that is infinitely scalable
-Creation of a secure voting mechanism for token holders
-The use of mathematics to provide a provably secure blockchain that is less prone to attacks
-Separation of accounting and computational layers
How Does Cardano Work?
Cardano’s blockchain has two layers: the settlement layer and the computational layer. The first layer has been completed and it’s now functional. It allows you to send and receive ADA tokens from one wallet to another. It uses a similar method Ether does (the native token of Ethereum). The second layer is still under development. Its objective is to allow users to sign up on smart contracts. Although it is similar to Ethereum’s blockchain, it is slightly better. It is more adoptable because you can make any changes depending on the requirements of end-users. This means it is written in a way that it can change how information is stored, processed, and accessed. The changes don’t disrupt ADA or the settlement layer.
To verify transactions, it uses the proof-of-stake (PoS) protocol. Users who want to participate are called validators, and they must invest a certain amount of ADA coins in demonstrating they’ve stake in this whole process. They are also rewarded based on their stake.