Cardano- The Visionary Crypto
- Tanishq Wadhwani
- May 11, 2021
- 5 min read
Twitter: A decentralized blockchain / cryptocurrency project based on peer-reviewed research and the highly secure Haskell coding language
Bitcoin takes more time for transaction which will make the users wait for a long time, and Ethereum is not scalable. Cardano was made to be a 3rd Gen Cryptocurrency. Cardano's Vision is to create an "Internet of Blockchains".
Cardano is an “Ouroboros proof-of-stake” cryptocurrency that was created with a research-based approach by engineers, mathematicians, and cryptography experts. The project was co-founded by Charles Hoskinson, one of the five initial founding members of Ethereum. After having some disagreements with the direction Ethereum was taking, he left and later helped to create Cardano.
The team behind Cardano created its blockchain through extensive experimentation and peer-reviewed research. The researchers behind the project have written over 90 papers on blockchain technology across a range of topics. This research is the backbone of Cardano.
Due to this rigorous process, Cardano seems to stand out among its proof-of-stake peers as well as other large cryptocurrencies. Cardano has also been dubbed the “Ethereum killer” as its blockchain is said to be capable of more. That said, Cardano is still in its early stages. The network will soon be able to handle smart contracts. While it has beaten Ethereum to the proof-of-stake consensus model it still has a long way to go in terms of decentralized financial applications.
Cardano is a blockchain and smart contracts platform with a cryptocurrency called "ada."
Cardano has released products for identity management and product traceability.
Cardano uses Ouroboros—a proof-of-stake algorithm—to create blocks and validate transactions occurring on its blockchain.
Cardano is a decentralized third-generation proof-of-stake blockchain platform. While it shares characteristics and applications with other blockchain platforms like Ethereum, Cardano distinguishes itself from others through a commitment to peer-reviewed scientific research as building blocks for updates to its platform.
Three organizations are responsible for Cardano’s development: IOHK, Cardano Foundation, and EMURGO. The first two are non-profit foundations and the third is a for-profit entity. The IOHK, which is responsible for building Cardano, works with a team of academics spread out across the world to produce research and review platform updates before implementation to ensure that they are scalable.
Charles Hoskinson, the co-founder of Ethereum, began the development of Cardano in 2015 and launched the platform in 2017. Cardano has positioned itself as an alternative to Ethereum. Both platforms are used for similar applications, such as smart contracts, and have goals of building a connected and decentralized system. Cardano considers itself as an updated version of Ethereum and has anointed itself a third-generation platform over Ethereum’s second-generation credentials. The blockchain platform also has a goal of providing banking services to the world’s unbanked.
Cardano’s main applications are in identity management and traceability. The former application can be used to streamline and simplify processes that require the collection of data from multiple sources. The latter application can be used to track and audit a product’s manufacturing processes from provenance to finished goods and, potentially, eliminate the market for counterfeit goods.
"Ada" is Cardano's digital currency and is named after Ada Lovelace, a 19th-century countess and English mathematician who is recognized as the first computer programmer.
The organizations behind Cardano have released three products: Atala PRISM, Atala SCAN, and Atala Trace. The first product is marketed as an identity management tool that can be used to provide access to services. For example, it can be used to verify credentials to open a bank account or eligibility for government aid. The other two products are being used to trace a product’s journey through a supply chain.
Cardano is also developing a smart contract platform that will serve as a stable and secure platform for the development of enterprise-level decentralized apps. In the near future, the team at Cardano plans to use a democratic on-chain governance system called Project Catalyst to manage the development and execution of projects. They will also revamp their treasury management system to fund future costs using Project Catalyst.
The heart of any blockchain platform is the algorithm it uses to create blocks and validate transactions. Cardano uses Ouroboros, an algorithm that uses proof-of-stake (PoS) protocol to mine blocks. The protocol is designed to reduce energy expenditure during the block production process to a minimum. It does this by eliminating the need for hash power, or massive computing resources, that are central to the functioning of the proof-of-work (PoW) algorithm used by Bitcoin.
In Cardano’s PoS system, staking determines a node’s capability to create blocks. A node’s stake is equal to the amount of ada, Cardano’s cryptocurrency, held by it over the long term.
On a broad level, Ouroboros works as follows. It divides physical time into epochs that are made up of slots, which are fixed periods of time. Slots are similar to working shifts at a factory. Currently, an epoch lasts five days, and a slot lasts one second, but these numbers are configurable and can be changed after an update proposal. Epochs work in a circular fashion: when one ends, another starts.
Each slot has a slot leader chosen by a “lottery” system. In this system, the higher the stake, the better the chances of winning the lottery. Slot leaders are responsible for the following tasks:
Validating transactions
Creating transaction blocks
Adding newly-created blocks to the Cardano blockchain
Ouroboros requires a small number of ada holders to be online and maintain good network connectivity. To further cut down on energy consumption, the algorithm contains the concept of stake pools. Ada holders can organize themselves into stake pools and elect a few to represent the pool during protocol execution, making it easy to participate and ensuring block creation even if some of them are offline.
A stake pool is a reliable server node that is committed to run the protocol 24/7, on behalf of the contributing ada holders. Stake pools hold the combined stake of various stakeholders in a single entity and are responsible for processing transactions and producing new blocks.
In a Proof-of-Work (PoW) system, the economic incentives for miners to participate in the network and create blocks are rewards of the cryptocurrency and transaction fees. Ouroboros collects rewards from an epoch and distributes them among stake pools and stakeholders. Each is rewarded based on the proportion of their stake contributed during the epoch, meaning a higher stake will receive more rewards.
Thus to conclude, Cardano is a blockchain platform for changemakers, innovators, and visionaries, with the tools and technologies required to create possibility for the many, as well as the few, and bring about positive global change. Cardano is a proof-of-stake blockchain platform: the first to be founded on peer-reviewed research and developed through evidence-based methods. It combines pioneering technologies to provide unparalleled security and sustainability to decentralized applications, systems, and societies. With a leading team of engineers, Cardano exists to redistribute power from unaccountable structures to the margins – to individuals – and be an enabling force for positive change and progress. Cardano restores trust to global systems – creating, through science, a more secure, transparent, and sustainable foundation for individuals to transact and exchange, systems to govern, and enterprises to grow. Cardano brings a new standard in technology – open and inclusive – to challenge the old and activate a new age of sustainable, globally-distributed innovation. Cardano is the first blockchain platform to be built through peer-reviewed research, to be secure enough to protect the data of billions, scalable enough to accommodate global systems, and robust enough to support foundational change.
Cardano aims to be the financial operating system of the world by establishing decentralized financial products similarly to Ethereum as well as providing solutions for chain interoperability, voter fraud, and legal contract tracing, among other things. As of May 2021, Cardano has a market capitalization of $55.98 billion.
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