2.2 k views

The Beginner’s Guide to Cardano – What You Need To know

Cardano provides one of the most secure cryptocurrencies by mixing a scientific approach with philosophy. Most probably, the future of mainstream crypto as we know it.

While miners inhabit most blockchain-based ledgers, Cardano amassed many mathematicians, scientists, and independent thinkers. Together they develop and support an open-source and patent-free platform where users can create and execute DApps and smart contracts faster on a multi-layer protocol.

Like most decentralized and highly-promising public networks that use blockchain technology, Cardano has its native asset. ADA is a utility token you can use on the platform and store in the community-developed Daedalus Wallet.

 Cardano is developing slowly but steadily into an innovative cryptocurrency with a development philosophy.

Cardano in a Nutshell

  • Cardano is a decentralized, open-source, patent-free platform
  • Cardano uses blockchain technology to enable the creation of smart contracts and DApps
  • Cardano was released in 2015 by two former Ethereum employees
  • Cardano uses scientific papers instead of a whitepaper
  • Cardano uses ADA as native crypto on the platform
  • Cardano is the first cryptocurrency to use a Proof of Stake protocol that is scientifically proven to be secure.
  • Cardano uses the Ouroboros algorithm to obtain Proof of Stake instead of mining.
  • Cardano’s ADA tokens can be stored in the community-created Daedalus Wallet.

What is Cardano?

Cardano is a decentralized public network that uses blockchain technology to enable smart contracts and DApps.

Cardano is in direct competition with Ethereum, the largest smart contract-supporting blockchain on the market.

Like its giant-size competitor, Cardano has a native digital asset in the form of ADA and a Proof of Stake-like consensus mechanism called Ouroboros.

Where Cardano claims to have a competitive advantage is its academically peer-reviewed nature. This fully open-source platform is named after Gerolamo Cardano, a famous Italian polymath from the 16th century. According to its creators, it is the only blockchain network to follow scientific philosophy in its research and development.

Cardano replaced the standard whitepaper that almost all cryptocurrencies release on their launching with a set of academic papers on which it bases its philosophy.

Another aspect differentiating Cardano from Ethereum is its versatile offer of applications and ease of use. The network can process transactions and smart contracts in a multi-layer style to enable users to develop DApps faster and more efficiently.

ADA is the cryptocurrency available on the Cardano network. It is a utility token that allows users to transfer and receive digital funds. Its creators believe that this crypto’s use and behavior on the market give us a sneak preview of how the money will look in the future.

At the time of writing, ADA had a value of USD 0.038545 per unit, and a market cap of USD 999,350,627, according to CoinMarketCap.

A brief history of Cardano

Cardano is the creation of Charles Hoskinson (one of Ethereum’s co-founders) and one of his former colleagues at Ethereum, Jeremy Wood.

In 2015, the two developers proposed a new blockchain-based platform for smart contracts and cryptos that would expand the use and understanding of the world of digital assets and applications.

Hoskinson and Wood established Input Output Hong Kong (IOHK), one of the major companies supporting Cardano’s development. In time, two others joined their efforts – Emurgo and The Foundation.

The developers raised almost $63 million for Cardano’s development in an ICO that lasted for nearly two years, between January 2015 and January 2017.

Cardano is the only blockchain-based network to have passed the official algorithm review at the International Cryptology Conference in 2017.

How does Cardano work?

Cardano works as the Cardano Settlement Layer (CSL), the balance ledger, and is the network’s top layer. According to the Ouroboros whitepaper, its developers consider it an improvement to Bitcoin and a cryptocurrency innovation.

Cardano uses Ouroboros, a Proof of Stake algorithm with additional features that make it completely distinct from other smart contract-based blockchains.

Ouroboros is a crucial element of the system that supports ADA cryptocurrency. Contrary to other algorithms, it removes the need for mining from the users. Instead, it uses mathematics to prove the validity of a transaction through a randomly selected stakeholder, which only has a proportional size to the stake.

Ouroboros is the first to develop a proof-of-stake algorithm that ensures complete randomness and optimal security. This process uses a multiparty implementation of a coin-flipping protocol, a cryptocurrency innovation.

Cardano also summarizes its entire development into an allegorical sequence called the Cardano Roadmap.

Staying true to the network’s philosophical and scientific approach to cryptocurrency, the Cardano Roadmap uses five divisions of development, each named after great historical innovators, as follows:

  •         Byron | Shelley | Goguen | Basho | Voltaire

These five stages are called eras and will develop in parallel but be delivered sequentially. They will include years of research, proposed algorithms, developments, and prototyping that will link academic discoveries with innovations in cryptocurrency to transform Cardano into the next generation of cryptos ready for mainstream adoption.

Each era in the Cardano Roadmap has a countdown to its release. Once an age is revealed, all of its content becomes accessible to the Cardano community. 

How to buy and own ADA

Cardano’s native asset ADA has a hard cap of 45 billion pre-mined tokens.

You cannot buy an ADA with fiat money. However, you can make an account on popular cryptocurrency exchanges online and exchange fiat currencies for other cryptos like Bitcoin, Ethereum, or Litecoin. Next, you can use these tokens to purchase ADA.

Here are some of the best choices for becoming an ADA owner:

Where to store ADA

When it comes to storing ADA, Cardano offers a reliable solution with its Daedalus Wallet.

This storage option for digital assets is a safe, multi-platform HD wallet developed explicitly for the Ada cryptocurrency. You can easily install it on your computer, whether it is a PC or a MAC, and benefit from the following:

  •         High protection encrypted private keys and passwords.
  •         Protection against hacker attacks and malware
  •         The option to export the wallet to cold storage solutions like paper certificates
  •         Transaction assurance level monitoring

The Cardano developers are working on enhancement solutions to benefit from using ADA tokens and the ledger. These projects include:

  •         Support for Ethereum and Bitcoin
  •         A portable wallet for both iOS and Android-running smartphones
  •         The possibility for ADA holders to participate in the block generation process actively.
  •         An app store where the community can promote its locally-built applications

The advantages of using Cardano

  • Cardano uses Ouroboros – the first Proof of Stake protocol scientifically proven secure.
  • Cardano uses a multi-layer protocol to enable the execution of smart contracts and DApps concomitantly on different layers.
  • Cardano fulfills cryptocurrency’s main requirements by simultaneously ensuring its users’ security and the viability of its processes.
  • Cardano can quickly adapt to the upcoming changes in the cryptocurrency market through soft forks.
  • Cardano is open-source and patent-free.

The risk of investing in Cardano

Bitcoin live price
price change

The development speed of Cardano is slow despite its promising potential and future success. The ICO that took two years to complete is a clear sign that while Cardano uses a scientific approach to create the most secure cryptocurrency to date, maybe overthinking its next steps dents its evolutionary pace.

Stay up to date with our latest articles

More posts

How Can Crypto Projects Use Telegram and Discord to Grow

Crypto projects have an excellent opportunity to reach and engage with their audiences using two popular messaging platforms: Telegram and Discord. How can they make the most of these channels? Today, we'll explore the differences between Telegram and Discord and show you a few successful examples on both platforms. Furthermore, we'll provide strategies for growing your crypto community. We will conclude this guide with tips for engaging your audience, combining the strengths of both platforms. Why Telegram and Discord are…

The Role of a Valid Go-To-Market Strategy in a Crypto Project Success

In the rapidly evolving world of cryptocurrency, a good go-to-market strategy is essential for any project to achieve success. Unfortunately, it's not enough to create an innovative product. You must also know how to reach your target market and effectively promote it to gain traction.  With careful planning and execution, you can develop an effective launch plan to maximize your chances of success in crypto. This article will discuss the importance of a go-to-market strategy and common mistakes when developing…

How Can a Team Create Market Traction on Its Crypto Project?

Market traction is a must-have if you want to create real, lasting success with your crypto project. But how do you ensure your team achieves the traction needed to drive meaningful growth?  This guide will explore some strategic methods for building and maintaining momentum in the crypto sector. Never underestimate the power of effective market traction – it could be the key to unlocking your project's potential. Why You Need Market Traction in the Crypto Sector The success of any…

Which Features Should a Successful Crypto Team Possess?

Creating a successful crypto team becomes imperative to succeed in this industry. This is particularly true as more people come together and launch their digital currencies or tokens. The right team and set of skills can make a huge difference in the overall success of your crypto project. This guide will explore features a successful crypto team should possess to ensure long-term success. Is There an Ideal Profile for a Crypto Team? A successful crypto team should be composed of…

What You Need to Know Before Investing in a Crypto Project with Anonymous Team

Investing in a cryptocurrency project can be an exciting way to grow your wealth, but it can also be risky. Investing in a crypto project with an anonymous team adds complexity and risks. The Phenomenon of Anonymous Crypto Teams If you explore the Internet for financial ideas, you've probably already encountered anonymous crypto teams. Some cryptocurrency teams that stay anonymous are growing successful. Some anonymous crypto teams have succeeded, despite traditional investors' reluctance toward them. For example, to this day,…

The Buyback and Burn Practice Explained

In a constantly evolving and growing crypto market, it is difficult for investors to know where to put their money. One popular investment strategy in the crypto space is buying tokens of teams that conduct a buyback and burn program.  This guide will explore what a buyback and burn practice is, how it works, and its benefits and risks. What Is a Crypto Buyback and Burn Practice A crypto buyback and burn practice happens when a company buys back its…

Should You Sell Off Your Crypto Assets During a Bear Market?

Selling your crypto assets during a bear market can be a hard choice. On the one hand, selling off your assets may seem logical during a down market. But, on the other hand, you may be worried about missing out on potential profits if the market rebounds.  This guide will illustrate the benefits and risks of selling your crypto assets during a bear market. While you should always research, we will share some tips for successfully doing so. What Is…

Why Do Some Crypto Projects Issue More than One Token?

In recent years, the popularity of cryptocurrency has exploded. As a result, more and more people are looking to invest in crypto projects. However, not all projects are equal, and it can be challenging to determine which ones are worth investing in. This guide aims to help investors decide which crypto projects to invest in. In addition, it will explain multi-token models and why they have become so popular among crypto projects.  The guide will also outline the benefits of…

How to Spot a Crypto Project with Great Tokenomics?

In the cryptocurrency world, there are a lot of projects with amazing tokenomics. However, it can take time to determine which projects are worth investing in.  This guide will help you spot a project with great tokenomics. In this way, you can make a great decision about where to invest your money.  Before analyzing the technical components of tokenomics, there are other red flags you should be able to spot. Our guide will begin with this premise and then move…

A Guide to the Signs that a Crypto Project is About to Fail

Cryptocurrencies are digital assets and a payment system invented by Satoshi Nakamoto. They use cryptography to secure their transactions and control new units' creation. Cryptocurrencies are decentralized and not subject to government or financial institution control. Bitcoin, the first cryptocurrency, appeared in 2009. With the rise in the popularity of cryptocurrencies, there has also been an increase in crypto projects that end up failing.  This guide will explore the signs that a crypto project will fail. By understanding these signs,…