Cardano is an open-source platform that leverages the power of its native cryptocurrency token, ADA. This innovative ecosystem, which serves as a host for decentralized systems and applications worldwide, was brought to life in 2017 by Charles Hoskinson, a co-founder of Ethereum.
Unlike Bitcoin, which was built on the foundation of a single authoritative white paper, Cardano's inception was quite different. Hoskinson envisioned a layered system that would address and rectify the issues prevalent in other cryptocurrency ecosystems.
Cardano positions itself as a "third-generation" protocol, building upon the foundations laid by Bitcoin and Ethereum, the pioneers of the first and second generations respectively. The platform draws its name from Gerolamo Cardano, an illustrious mathematician of the Italian Renaissance, while its native currency, ADA, pays homage to Ada Lovelace, a 19th-century mathematician often credited as the world's first computer programmer.
At the core of Cardano's functionality is the Ouroboros consensus protocol, a proof-of-stake algorithm that powers the creation of blocks and validation of transactions on the platform. Crafted by leading experts in cryptography and engineering, Ouroboros is grounded in scientific and mathematical principles, enhancing the platform's efficiency and security.
Cardano's commitment to a research-driven approach sets it apart in the blockchain industry. The organization has contributed numerous peer-reviewed papers to the academic community and has forged partnerships with various universities to promote blockchain research and education. The Cardano ecosystem is supported by three entities: the Cardano Foundation, a non-profit organization; Emurgo, its commercial arm; and Input-Output Global (IOG), a firm specializing in blockchain software development. These entities collaborate to drive Cardano's development along its roadmap.
The current ADA price is $0,288474 USD with a market cap of $10 088 460 128 USD. ADA has a circulating supply of 34 971 869 937 ADA coins and a maximum supply of 45 000 000 000 ADA coins.
Cardano can be purchased on a number of centralized and decentralized exchanges includingmBinance, OKX, Kraken, SushiSwap, Biswap and many more.
How Does Cardano Work?
Cardano is committed to being the most eco-friendly platform in the space. Its consensus mechanism, Ouroboros, is a proof-of-stake system that stands in contrast to the energy-consuming proof-of-work.
Ouroboros, designed with a keen focus on efficiency, significantly cutting the energy consumption of the network, offering a sustainable alternative without compromising on security. This proof-of-stake protocol empowers any token holder on the blockchain to establish their own network node and become validators. To do so, they need to stake their crypto tokens, essentially pledging them to the blockchain.
The Ouroboros protocol selects a validator node in a pseudo-random manner for each block of transactions that require verification. The selection process is influenced by the number of ADA tokens staked by the node. The more tokens staked, the higher the probability of being chosen. Once a validator node verifies a block of transactions and appends it to the blockchain, it receives a block reward, incentivizing token holders to stake their ADA tokens.
Cardano's functionality is enhanced by its proprietary Turing-complete programming language, Plutus. Developed in Haskell, Plutus smart contracts are essentially Haskell programs, with parts running on the blockchain and others on a user's machine.
In addition to Plutus, Cardano supports the Marlowe programming language, a domain-specific language designed for crafting and executing financial smart contracts. Marlowe empowers developers to leverage their domain expertise in the creation and management of smart contracts, particularly in the financial sector.
Cardano's architecture is divided into two layers: the Cardano Settlement Layer (CSL) and the Cardano Computation Layer (CCL), which form the backbone of every transaction. The CSL is designed to manage the transfer of value between the sender and the receiver, acting as the routing layer for all control layers and systems. It employs two dedicated scripting languages, Plutus and Marlowe, to facilitate the movement of value and bolster support for overlay network protocol.
The CCL, on the other hand, enables Cardano to mirror the smart contract platform of the Bitcoin ecosystem, Rootstock (RSK blockchain). The implementation of the CCL is driven by its potential to scale specialized protocols over time, including the addition of hardware security modules (HSM) to the existing protocol stack as technology evolves.
The dual-layered structure of the Cardano blockchain allows the ecosystem to proactively implement changes to support faster, more secure transactions while discarding any user metadata that is irrelevant to the process.
ADA, the native token of the Cardano blockchain, resides on the Cardano Settlement Layer. With a maximum supply capped at 45 billion tokens, ADA ensures a deflationary attribute. However, the ecosystem is expected to exhibit an inflationary trend until a significant portion of the reserves is released for circulation, projected to commence around 2030.
What is Cardano Used For?
Cardano is designed to facilitate a wide array of applications. Its primary use is to operate as a platform for smart contracts, cryptocurrencies, nonfungible tokens, and DApps.
ADA, the native cryptocurrency of the Cardano platform, serves multiple purposes. Primarily, it is used as a digital currency, similar to Bitcoin or Ethereum.
ADA is also used in the staking mechanism of Cardano's proof-of-stake consensus protocol. ADA holders can stake their coins, participating in the block production of the Cardano network, and earning rewards in return. It is also used in the blockchain governance as ADA holders can stake them to suggest proposals and vote on them.
ADA is also used to power applications and platforms built on the Cardano network and pay for transaction fees.
Cardano was created in 2017 by Ethereum co-founder Charles Hoskinson.
The Cardano project is now managed by three separate entities: the Cardano Foundation, Input Output Hong Kong (IOHK), and Emurgo.
The Cardano Foundation is a non-profit organization based in Switzerland. Its primary responsibility is to support the Cardano community and work with authorities on regulatory and commercial matters. The foundation aims to influence and progress the Cardano protocol, providing an all-important balance of oversight and encouragement for the ecosystem's development.
IOHK, or Input Output Hong Kong, is a technology company committed to using peer-to-peer innovations to provide financial services to the world's three billion unbanked individuals. IOHK is the driving force behind Cardano's technology and development. The company was founded by Charles Hoskinson and Jeremy Wood in 2015, and it is contracted to design, build, and maintain the Cardano platform until 2020.
Emurgo is a global blockchain technology company providing solutions for developers, startups, enterprises, and governments. Emurgo develops, supports, and incubates commercial ventures and helps integrate these businesses into Cardano's decentralized blockchain ecosystem. Emurgo is focused on building a Cardano as a blockchain solution for large-scale, transformative projects.