What is Cardano?
Cardano is both a platform that hosts the cryptocurrency, Ada, and a byword for the coin. While it does offer hosting of dApps and running smart contracts similar to Ethereum, it has further improved upon the concept as it splits the computational and accounting parts of the ledger into different layers. Additionally, the base code is prepared for future upgrades, while keeping the integrity of the network. Coin supply is limited to 45 billion, expected to be reached in the year 2042. Subunits are equal 1 millionth of an ADA and they’re called Lovelace.
Advantages
The development team behind the Cardano cryptocurrency like to consider themselves as a 3rd stage blockchain. Consider Bitcoin as the prime origin of digital currencies and Ethereum as the 2nd stage of that evolution, with the addition of smart contracts and dApps. Cardano is the next step in the puzzle, improving upon already existing systems. Other advantages include:
- Scalability – by splitting the accounting and computation layer, Cardano can be modified much more easily without destroying the network
- Scientific approach – the developers aim to solve existing problems with already good systems, thus allowing for wider adoption
- Interoperability – the aim is to provide a relay station within Cardano, that will allow different blockchains to intersect and cross-communicate without the need for an exchange
Disadvantages
As much as it sounds like a one-stop solution for all issues in crypto, Cardano is not without its drawbacks. The main concern is that it’s an unproven and untested platform, so far. Other cons that can be found include:
- Governance and Treasury – while the idea of saving part of the block reward towards a common goal is beneficial for the network, the way it’s handled, and the potential voting system to allow for changes and further development of the blockchain, leaves grounds for speculation
- Proof of Stake – the uncertainty surrounding the PoS model of consensus can also be disconcerting. It hasn’t been tested extensively, nor has it been proofed while having millions of users, so the potential for hacks or exploits is big
History and Evolution
The project surrounding Cardano began back in 2015 with its primary aim, to improve the way of designing and developing cryptos. While so, the team didn’t have a roadmap or any whitepaper which would encompass their end goal. The company behind this endeavor is a blockchain dev firm by the name of Input Output Hong Kong (IOHK), led by Charles Hoskinson. After its main net launch on September 1, 2017, Cardano has continually upgraded and improved its systems. Testnets for different new features have been launched and many new features are in the works – light wallets, Linux compatibility, MultiSig transactions etc.
Cardano Blockchain
The blockchain of Cardano is an ongoing development project with the help of countless great minds from and outside the cryptocurrency sphere. The most unique feature is as previously mentioned, the splitting in different tiers of accounting and computation. Thus, upgrading via soft or hard fork is easily done, without damage to the community. While there’s been a shameless borrowing of ideas from other cryptos, the end goal is to deliver an all-around great product. The consensus algorithm in place is a custom version of Proof of Stake called Ouroboros and block time is 20 seconds. Transactions are fast, while block size is without a hard cap. Currently, there are no fees and about 31,1 billion ADA coins in circulation, with the minting of new ones planned in the future.
Cardano Nodes
To keep the network going, we are presented with three different types of nodes:
- Relay – intermediaries for connecting core nodes to the Internet outside the blockchain
- Core – the most important in the network, as they are the ones that create new blocks and thus mint new coins. They are isolated from the internet and communicate via relay nodes
- Edge – simple nodes, you can consider them as light nodes, the only serve to create transactions
Noteworthy Features
The uniqueness of Cardano lays in its multi-layer structure. Currently, we have only the transaction layer in place, however, in the future, the settlement layer will be added. It would govern smart contracts and allow for increased customization of conditions. Furthermore, it’s going to allow seamless upgrades of protocols, without any damage to the blockchain.
A key moment in the development process of Cardano is the peer review. Contrary to its competitors, the development team utilizes its vast connections inside and outside the crypto sphere, by having colleagues, universities and organizations that are participating, review the coding process and deal with any bugs or vulnerabilities before the product is even launched.
How to Get Cardano
At this time and the foreseeable future, as ADA coins are based on Proof of Stake, the only way to obtain some is by buying it from an exchange.
Where to Buy ADA
In this section, I’ve researched the top 3 exchanges that allow the user to buy Cardano with fiat currency.
| Exchange | Cryptocurrencies | Fiat Money | |
|---|---|---|---|
|
Kraken
|
Cardano, Bitcoin, Monero + 13 more | USD, EUR, GBP | Trade now |
|
Exmo
|
Cardano, Stellar, Zcash + 16 more | USD, EUR, RUB | Trade now |
|
Bittrex
|
Cardano, Ravencoin, 0x + 45 more | USD | Trade now |
Wallets for Cardano
To begin your journey in the world of cryptocurrencies, you first need to obtain a wallet. It will serve you as a means to store your coins and operate with them. No matter if you buy them from an exchange or have someone trade you, you’ll need a wallet address to receive them.
Getting started with the Cardano cryptocurrency is easy. Just follow the link to the Daedalus wallet – the official one for ADA. It supports Windows 64-bit versions, MacOS 64-bit and soon – Linux. All you need to do is download the appropriate program and installing it is easy. Below you can find an easy to follow guide for Windows.
- Windows installation – https://forum.cardano.org/t/step-by-step-installation-of-daedalus-wallet/8409
Alternative Wallets
The open-source nature of cryptocurrencies extends to wallets as well. Many developers invest their time and effort to create alternatives to official wallets, providing users with increased security, backup functions, ease of use, and other benefits. Below, you’ll find some recommendations for your convenience.
Staking Cardano
While not yet implemented, staking Cardano coins in the future will be handled in an interesting new way. The concept is to have pools for staking, which will generally even out the rewards for most participants. To combat pools becoming too large and centralized, there will be a limit to their number and the total amount every single one can receive. This, in turn, would lead users to diversify and spread out evenly across pools.
Future of the ADA Cryptocurrency
The Cardano project is an ever-evolving one. Currently in a somewhat initial phase, the focus of developers is ironing out of bugs and improving the capacity for future integration through APIs and third parties.
While the aim for the future is the full decentralization of Cardano, steps have been made to combat the main issues seen with Ethereum’s smart contracts as to avoid them. Separately, developing a new foundation for the creation of such contracts is also in play.
News and Useful Links
Keeping up to date with the latest surrounding Cardano is easy. Just follow the links provided below to the official sources of up-to-date information on ADA.