As a "third-generation" blockchain, it intends to address the scalability problems inherent in second-generation blockchains,
such as the highly anticipated Ethereum 2.0 update.
Cardano's development is characterized by a scientific philosophy and great academic research. With the launch of Shelley in 2020, Cardano is getting closer and closer to its goals.
Introduction
Cardano and its related cryptocurrency ADA have attracted a lot of attention since its inception in 2015. The academic rigor applied to its development makes Cardano a rather unique project in the cryptocurrency industry.
The Cardano project is mainly developed by the technology company Input Output Hong Kong (IOHK), founded by Charles Hoskinson. Hoskinson also dealt with Ethereum in its early days.
But what is Cardano, and what are the features it plans to introduce in its long roadmap? Let's find out.
What is Cardano (ADA)?
Cardano is a multipurpose blockchain designed on the basis of academic research. Its development is entrusted to a multidisciplinary team of engineers, mathematicians, scientists, and business experts.
The development of the platform is always achieved by applying a scientific approach. Ada, Cardano's native currency, is used to perform operations on the Cardano blockchain, in a relationship very similar to that between ether (ETH) and Ethereum.
Cardano development is separated into multiple operating units. IOHK manages the development of the Cardano protocol, while the Cardano Foundation oversees the project and EMURGO is responsible for commercial development and adoption. IOHK also had to do with the development of the Ethereum Classic (ETC).
The Cardano Roadmap (ADA)
Cardano's roadmap consists of five main stages: Byron, Shelley, Goguen, Basho, and Voltaire. Byron, the first phase, saw the rollout of the network and core features, such as ADA relocations. The Shelley hard fork occurred in 2020 and offers further steps towards decentralization. Currently, the nodes are operated by the Cardano community, with staking pools managed by ADA owners.
As of December 2020, the blockchain platform is still unable to accommodate functional smart contracts. According to the roadmap, tHow does Cardano (ADA) work?
Cardano is designed as a "third-generation" blockchain, with the aim of solving the scalability problems of the first (eg, Bitcoin ) and second-generation (eg, Ethereum ).
According to proponents of this classification, blockchains of previous generations suffer from bottlenecks that fundamentally limit the capacity they can handle. This makes them an inefficient choice for widespread use globally. We can observe the varying transaction times of BTC and ETH to confirm this problem.
In the documentation, Cardano indicates the computational power of VISA as a comparison:
the network handles an average of 1,736 transactions per second (TPS) with the capacity to handle up to 24,000 TPS.
Cardano aims to improve capacity in several ways. One of the most significant pillars towards this goal is the Proof of Stake (PoS) consensus mechanism called Ouroboros. Ouroboros reduces energy costs compared to Proof of Work (PoW) and at the same time offers demonstrable safety guarantees.
The hard fork combiner is another key feature of Cardano, which allows you to hard fork without interruption or the need to restart the blockchain. The success of the Shelley update is proof of the effectiveness of this approach.his feature will be introduced with the Goguen update. Following Goguen, the Basho era will focus on optimizing scalability and interoperability, and the Voltaire era will introduce a treasury system to address the governance issue.
The key functions of Cardano (ADA)
As we have mentioned, Cardano's strong points are its academic and scientific philosophy. The team developing Cardano has published more than 90 white papers for the underlying technology. The project has a well-defined roadmap, and the network aims to achieve high levels of security, scalability, and interoperability.
Even if it is not yet operational, in the future the Cardano blockchain will introduce the functionality of scalable
As with Ethereum, the possibilities of Cardano's use cases are vast. The blockchain only aims to act as a foundation layer upon which to build applications.
Despite great promises, Cardano has yet to meet expectations - like almost all projects in the crypto sector except Bitcoin. Although Cardano is ambitious, its development is relatively slow.
What is the ADA Token?
ADA is Cardano's token, named after 19th-century mathematics Ada Lovelace. 57.6% of ADA's offering was distributed through an Initial Coin Offering (ICO) , in which Cardano raised $ 62.2 million.
The token is both a digital currency and a way to transact on the Cardano network (similar to the role of ether to transact on Ethereum).
Additionally, ADA holders have a share of the Cardano network, which can be used in staking pools to generate rewards. It is a full node wallet, so it is necessary to download the entire Cardano blockchain, and every transaction is verified for maximum user security.
Among the light wallets, which do not require you to download the entire blockchain, are Yoroi Wallet and AdaLite. Additionally, it is possible to store ADA on hardware wallets such as Ledger and Trezor through Daedalus, Yoroi Wallet, and AdaLite.
Closing
Cardano is an ambitious project that aims to provide a blockchain infrastructure in the crypto ecosystem. Development proceeds slower than some might expect, but at the same time, it is aiming high.
Will this third-generation blockchain project become the dominant smart contract platform, or will it come to market too late? Are there 4th generation blockchains that offer better performance and functionality? These questions remain open as Cardano progresses on his roadmap.
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