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Dec 28, 2020

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What is Cardano (ADA) | Complete Guide

What is Cardano (ADA)

Cardano is one of the most exciting projects in the crypto-sphere, having become a serious competitor to Ethereum, since its platform allows hosting of smart contracts and decentralized applications. 

It grew from a small group of enthusiasts to today being a global community.

ADA, its native token, is listed in more than 30 exchanges, and has a market capitalization that makes it one of the leading cryptocurrencies on the planet.

Cardano is supported by three organizations that are separate in both ownership and leadership. The Cardano Foundation is an independent organization based in Switzerland that oversees the development of the Cardano ecosystem, IOHK designs and builds Cardano and Emurgo is the for-profit arm that supports Cardano on the business side.

Founded by Charles Hoskinson, its development began in 2015 and it raised around $ 60 million in an ICO in 2017 before its launch.

Brief history

In August 2017, Aggelos Kiayias, Alexander Rusell, Bernardo David and Roman Oliynykov, presented the White Paper of “Ouroboros”, the first blockchain protocol based on Proof of Stake with rigorous security guarantees, comparable to those that had already obtained the Bitcoin blockchain.

You can see Ouroboros here

Ouroboros is the backbone of Cardano.

Charles Hoskinson was one of the original eight founders of Ethereum. In June 2014 he left Ethereum. He was very committed to the Ethereum project, but had serious disputes when accepting the entry of venture capital. His old colleague at Ethereum, Jeremy Wood, proposed a new project called IOHK, Input Output Hong Kong. IOHK’s most important project today is Cardano, and Charles Hoskinson is the current CEO of IOHK.

From the beginning, Cardano was programmed with a careful roadmap, shown below:

Byron. Foundation. The first version of Cardano (2015) allowed users to buy and sell the cryptocurrency ADA, named after the revolutionary programmer Ada Lovelace. Also in this era the Daedalus and Yoroi wallets were born.

Shelley. Decentralization. At Shelley’s end, Cardano is expected to be 50-100 times more decentralized than any other mainstream blockchain.

Goguen. Smart Contracts. The ability to create dApps is added, creating the Plutus language and the Marlowe platform.

Basho. Scaling. Optimization through the improvement of scalability and interoperability of the network, through the creation of sidechains.

Voltaire. Governance. Introduction of the voting system by means of which participants can use their stake to vote and influence the future development of the network.

The following graph shows the evolution of ADA prices since its inception:

Cardano Technology

Cardano is considered a third generation blockchain, technically more advanced than Bitcoin (first generation) and Ethereum (second generation). It uses the PoS consensus protocol and has two layers, one that works as a cryptocurrency (ADA) and the other as a host of smart contracts. All the math and science behind the Cardano blockchain is always peer-reviewed, with the goal of assuring the ecosystem as verifiable, secure, and science-based.

The Cardano network runs at a fraction of the cost of the necessary energy that Proof of Work networks use.

Ouroboros processes the transaction blocks dividing the chains into epochs, which in turn are divided into time slots. A slot leader is chosen for each time slot, and is responsible for adding the block to the chain. To prevent malicious attacks, each slot leader is asked to take into account some previous blocks of the transitory chain received. Only the chain that precedes a predetermined number of transitory blocks is considered set. This is known as settlement delay, and it is the mechanism that allows the ledger to be passed safely between the participants.

Ouroboros is a fusion of innovative technology and philosophy. The Cardano team’s research explores how we behave as a society and attempts to discover an ideal balance, using game theory to assess individual and collective interests.

There are two types of Ouroboros: Ouroboros and Ouroboros Praos.

In Ouroboros, the method used for the random generation of processes is PVSS, publicly verifiable secret sharing. A “sharer” splits up a secret into multiple “parts”. The original secret can only be reconstructed if one of the participants has access to a certain proportion of “parts”. In Ouroboros Praos, a VRF method, verifiable random function, is used to generate a random schema. Given a private key and an input, the VRF method generates a pseudo-random number and a “test”. Anyone with their public key and the “test” can verify that the number was produced with the given input, but cannot produce the number before then.

Perspectives and takeaways

The team’s vision is to create a reference project that serves as an example of how to do things in a more effective, healthy and honest way.

Charles Hoskinson announced in a recent AMA on YouTube that Cardano will replace Bitcoin as the number one cryptocurrency in a short time, although he did not specify what metric he was referring to, be it market capitalization, number of users, volume of transactions, etc.

To achieve market leadership, Hoskinson announced that the main components of the Cardano ecosystem, IOHK, Emurgo and Cardano Foundation, are going to focus on a large commercialization project.

Hoskinson shows great respect for Bitcoin, saying that the oldest of the cryptocurrencies will always be valuable, which is demonstrated by the acceptance of Bitcoin by governments and large corporations. Bitcoin becomes, according to his appreciation, a gateway for the acceptance of Cardano.

Cardano Website

For the ultimate source of information, visit Cardano Website 

Cardano Block Explorer

Track your Cardano transactions with Cardano Block Explorer

Cardano Reddit

Join Cardano’s subreddit r/cardano to discuss the currency with the rest of the community.

Cardano Twitter

Follow @Cardano  on Twitter to keep up with the latest updates.

How to store and manage ADA

Cardano (ADA)  is supported by multiple wallet providers, including Atomic Wallet. In Atomic, you can manage, exchange, and buy ADA. Atomic Wallet empowers you with full control over your funds since your Private Keys are protected with a mnemonic seed and never leave your device. Atomic Wallet provides you with one of the best options to store, send, exchange, and buy ADA. Install the app now and manage your ADA right in the Atomic Interface.

You can also stake ADA in Atomic Wallet, desktop version. There you have several pools to delegate your ADAs, with an interest of around 5%.

Conclusion

Cardano cannot be missing from any portfolio. It is evident that it is shaping up to be one of the hottest projects in the coming years. Spectacular growth in ADA’s market capitalization is expected, and furthermore, seeing ADA compete against a colossus like Ethereum promises an awe-inspiring spectacle, worthy of the cryptocurrency generation.

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