In this article, we will analyse and explain what Cardano is, why it was created, and how it differentiates with other cryptocurrencies. At the moment, ADA is one of the largest virtual currencies in the market. The team behind this blockchain protocol is working in order to make it one of the most efficient networks in the world.
This article will help you to understand what Cardano is, how it works and its main characteristics. Moreover, you will learn where to buy ADA and how you can start using this blockchain network. Additionally, you will get valuable information about its future and new developments.
Table of Contents
What is Cardano?
Cardano is one of the top platforms in the virtual currency market. The Cardano blockchain is the home to the ADA cryptocurrency that can be used to send and receive digital funds. The ADA cryptocurrency was released to the market in 2017 as an Initial Coin Offering (ICO). Since then, investors continue trading and investing in it on a regular basis. Currently, users can buy ADA using Binance or any other cryptocurrency exchange.
But Cardano is not just a cryptocurrency. It is a technological platform capable of running financial applications, smart contracts and decentralized applications. At the moment, several individuals and governments all over the world are using Cardano’s platform. That shows how useful the platform can be. However, the final stage of the Cardano network has not yet been released to the market.
This blockchain has been constructed in different layers that gives flexibility to the system. In this way, it can be easily maintained and allow soft forks and other upgrades. An interesting fact about Cardano is that it is the first blockchain project to be developed from a scientific approach. As Cardano’s website explains, it is the only one to be designed and built by a global team of leading academics and engineers.
Different Eras
Cardano does not work as a normal or a traditional blockchain network. The expansion of this blockchain ecosystem is ordered and separated in eras. Eras represent different developing plans to release new and exciting features to the market. The main eras include Byron, Shelley, Goguen, Basho and Voltaire.
These eras are expected to be released on different dates. Charles Hoskinson and IOHK are usually those in charge of announcing the official release date of these eras. The community is always very excited about the possibilities offered by each of these eras and how they could help the entire ecosystem.
Cardano, Emurgo and IOHK
Cardano is related to IOHK, a blockchain start-up founded in 2015 by Charles Hoskinson and Jeremy Wood. The company is committed to using peer-to-peer innovations to provide financial services to the three billion people who don’t have them. Charles Hoskinson is known for being the co-founder of Ethereum (ETH).
IOHK expresses about itself in the following way:
“We are an engineering company that builds cryptocurrencies and blockchains for academic institutions, governments, entities and corporations. We are a decentralized company that loves small, innovative teams forming and executing ideas that cause cascading disruption.”
You can think of this blockchain network as an organization that is based on three main pillars: IOHK, the Cardano Foundation and Emurgo. Each of them works as a very important part of the entire ecosystem.
Let’s start from IOHK. This part of the Cardano ecosystem is in charge of the development of the network. They work on new systems, blockchain development and features. They are the part of the team that works trying to bring the most efficient and advanced features to the network.
Emurgo, instead, is in charge of other topics and issues. They try to capture commercial opportunities to expand the Cardano organization as a whole. Without this branch of the ecosystem, it would be very difficult for the team to get the financial resources to push this network forward. Although there is a large number of users that would donate to the development of this network, it might not be the most efficient way to do so.
Finally, the Cardano Foundation. This part of the ecosystem is taking care of the partnerships. That means that if you see a company working with ADA or its network, it is very possible the Cardano Foundation was behind this arrangement. They try expanding and offering the features developed by IOHK to companies and projects.
ADA in the Cryptocurrency Market
The ADA virtual currency is one of the most valuable in the market. ADA is the 8th largest digital asset in the world. The digital currency has a market valuation of $4.8 billion. As of May 2018, the ADA token can now be purchased for $0.194 and there are 31,112,484,646 ADA coins in the market.
The price of ADA fluctuates as the entire cryptocurrency market. This cryptocurrency is now among the largest and has remained in the top 20 for a long period of time. As you can see in the image below, ADA continues to be the 8th-largest digital asset (January 2020). However, over the last years, its price fluctuated a lot.
Cardano’s ADA token in the Cryptocurrency Market
Cardano Challenges
There are some challenges that the Cardano organization needs to face in order to continue growing. One of the things that affected the network is the delay they had in recent years. They have been working very hard in order to release new features but there were delays on these projects.
Nowadays, these delays have been left behind and they became much more efficient with their timelines. Another thing to mention is related to the expenditure on marketing. While other projects spend large amounts of money promoting their coins, ADA prefers to focus on development.
Ouroboros
Cardano uses a proof of stake algorithm known as Ouroboros. The company explains that it determines how individual nodes reach consensus about the network. This is a crucial part of the infrastructure supporting the ADA virtual currency and it is a major innovation in blockchain technology.
This technology eliminates the need for an energy-hungry proof of work protocol, which stands as a barrier to blockchain scaling up for so much. The algorithm has been designed by a team led by IOHK Chief Scientist, Professor Aggelos Kiayias. Moreover, this is the first proof of stake protocol that has mathematically been shown to be provably secure.
Team
There are three main organizations that contribute to the development of Cardano.
The first is the Cardano foundation which is based in Switzerland. Its main responsibilities are to support the community of Cardano users and to work with authorities on regulatory and commercial matters.
The second entity working on Cardano is IOHK. IOHK is currently the holder of the contract to develop the Cardano platform until 2020.
Emurgo is a company that invests in start-ups and assists commercial ventures to build on the Cardano blockchain. The intention is to develop, support and incubate ventures and help integrate these businesses into Cardano’s decentralized blockchain ecosystem.
Charles Hoskinson, one of the co-founders of Ethereum was the main ideologist of the Cardano’s network.
Conclusion
Cardano is a third generation platform that solves Scalability Interoperability and Sustainability. The scientific approach behind this project would prevent it to split like happened with ETH and ETC or Bitcoin and Bitcoin Cash. With an outstanding team of experts and scientist, Cardano has an incredible potential and has proved that it is here to stay (at least for some more time).
Image Provided by Cardano.org and CoinMarketCap.
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