What is Cardano (ADA)? How it Works & Where To Buy It?

Cardano is a public blockchain that classifies itself as a “third-generation blockchain platform.” It was developed by Ethereum co-founder Charles Hoskinson.

Hoskinson was inspired to create the Cardano blockchain to be a more optimized and efficient alternative to Proof-of-Work (PoW) systems.

The project has garnered a formidable following and continues to make advancements in its 5-phase development.

How Cardano (ADA) Works

Cardano launched in 2017 and primes itself as an upgraded version of Ethereum. There are similarities between the functionalities of both platforms.

They both use smart contracts, develop similar applications, and envision building a unified and decentralized network. Ethereum is classified as a second-generation blockchain because it still uses a proof-of-work (PoW) algorithm.

Among the most significant ways Cardano aims to function is by banking the bankless by offering lucrative, reliable, and secure services through its blockchain technology.

Simply put, every blockchain requires a consensus algorithm to facilitate various functions. Cardano blockchain uses the Ouroboros consensus mechanism to achieve this.

The Ouroboros consensus mechanism implements an innovative approach to reach a consensus. Time is separated into epochs (periods of 5 days) that incorporate slots – the epoch is the duration of a cycle, and the slot is the duration of a “working shift.”

Essentially, a slot duration is only one second (adjustments can be made). The epochs run like clockwork; as one ends, another begins.

Leaders are delegated for every slot required to validate transactions, create transaction blocks, and sequentially add new blocks to the Cardano blockchain.

By utilizing this consensus mechanism, the network can operate optimally with only a minimal number of active ADA holders. It’s an innovative and energy-efficient mechanism that seamlessly initiates protocol executions through the use of stake pools (where people stake ADA cryptocurrency).

What Is Cardano (ADA) Used For?

The Cardano network is used to facilitate its specific blockchain products, namely Atala PRISM, Atala SCAN, and Atala TRACE.

Atala PRISM primes itself as an identity management tool that provides insights and access to services. One of its common uses would be the verification of credentials when opening a bank account or eligibility for things such as government aid.

These use cases for Atala SCAN and Atala TRACE are predominantly focused on the journey of a product through the supply chain.

Additionally, Cardano is in the midst of a 5-step development. The development steps are as follows:

• Foundation (Byron Era – complete)
• Decentralization (Shelley Era – complete)
• Smart Contracts (Goguen Era – current step)
• Scaling (Basho Era – not yet)
• Governance (Voltaire Era – not yet)

Cardano has developed an innovative contract platform that is currently onboarding decentralized applications (DApps). The development of the smart contract platform is aimed at driving exponential growth and value to the Cardano ecosystem.

The Cardano platform aims to be among the most prolific blockchain platforms in the world. Its founder, Charles Hoskinson, has made strides towards forming major partnerships, specifically in Africa.

Hoskinson has previously mentioned that the ADA cryptocurrency can be used as a much more stable alternative to the current banking system in Africa. The Cardano blockchain would be at the heart of this transition and would sequentially process and verify transactions and maintain the network.

Where To Buy ADA?

ADA is currently the 7th largest cryptocurrency by market cap. Over recent years it has become increasingly popular and is widely traded on most exchanges.

ADA can be purchased on several centralized crypto exchanges. Before you’re able to purchase it, you’ll need to deposit funds on the crypto exchange and purchase the tokens by placing an order.

These crypto exchanges are the safest place where you can buy, sell and store the ADA cryptocurrency.

Five of the most popular crypto exchanges are:

1. Binance
2. Coinbase
3. KuCoin
4. HTX
5. Gate.io

All of the above exchanges allow users to buy, sell, transfer and store ADA in a digital wallet on the exchange. You can use your debit or credit card to purchase ADA.

If you intend on transferring your ADA tokens to a wallet off of the exchange – you can choose to send them to a digital wallet that is compatible with the Cardano blockchain. Daedalus & Yoroi are the most common wallets used for storing ADA tokens and staking ADA.

How long have Cardano and ADA existed?

Cardano was founded in 2015, and the ADA cryptocurrency (named aptly after Ada Lovelace) was released in 2017.

The Cardano foundation was founded in Zug, Switzerland. Its role is to protect the Cardano protocol.

Since the inception of ADA, it has become a widely used cryptocurrency that is available on multiple crypto exchanges.

What’s controversial about Cardano and ADA?

Cardano has had some notable controversy in the past, and many individuals have polarized views regarding the project. Let’s take a look at 2 of the top controversies surrounding Cardano (ADA)

1. The Founder Was Unable To Complete His Ph.D. In Mathematics – A recent scandal has surfaced surrounding Charles Hoskinson’s academic credentials. It’s become apparent that the founder of ADA was unable to complete his Ph.D. in Mathematics and dropped out of college. This has caused quite a stir in the crypto community, with some members deeming him unfit to elevate Cardano to its highest potential.
2. eToro Delisting – Among the most prominent controversies was when ADA was delisted from eToro due to regulatory concerns.

How many ADA Tokens are there?

At writing, ADA has a circulating supply of 33.73 billion tokens.

ADA has a total supply of 34.28 billion.

Can XRP be mined?

ADA can’t be mined. The Cardano blockchain runs on a Proof-of-Stake algorithm, meaning that ADA cryptocurrency cannot be mined.

However, individuals can choose to stake their ADA and receive rewards – this is among the most common choices.

What is the market cap of XRP?

The market cap of Cardano (ADA) is:

ADA market cap = total amount of coins in circulation x current market price of ADA

ADA Market Cap = 33,730,000,000 x $1.18 = $39.80Bn

The market cap fluctuates according to circulating supply and market price.

Biggest Competitors Of Cardano and ADA

The top competitors of Cardano are Ethereum (ETH), Solana (SOL), Waves, Polkadot (DOT), and Stellar (XLM).

What are the future plans for Cardano?

The Cardano platform seeks to expand its ecosystem and cement its position as a formidable blockchain protocol. The nonprofit Cardano foundation is currently at step 3 (Goguen Era) of its 5-step development and will continue to progress going forward.

Charles Hoskinson has made it clear that he intends to revolutionize the crypto space with valuable projects, blockchain networks, and tools that have real-world utility.

Pros and Cons of Cardano Blockchain Platform, Cardano Network & its Smart Contracts

Pros

• Energy Efficient Consensus Mechanism – Cardano uses the Ouroboros consensus mechanism to run the network. It’s a proof-of-stake model that doesn’t require intensive energy consumption like other proof-of-work models.
• Cardano Network Already Has Products – There are already several products being utilized via the blockchain platform. Cardano offers Atala PRISM, Atala SCAN & Atala TRACE. Many other products rely on hype and the promise of working products, whereas Cardano has already delivered working products.
• Largely Available On Crypto Exchanges – The trading of ADA tokens is relatively popular on crypto exchanges. They are available on most exchanges.
• Cardano Settlement Layer Is Very Efficient – The technology used for settlement is innovative and efficient. It can also be implemented globally – with the Cardano coin (ADA) being used to facilitate monetary transfers.

Cons

• It Is Still In Development – The project is only at step 3 of its 5-step development. Therefore it is uncertain what the future of this project will be. Many deem that it will be successful, but skeptics claim that the project is yet to deliver sufficiently.
• Charles Hoskinson Academic Controversy – There is a substantial amount of doubt surrounding the project after it was closed that Hoskinson was unable to complete his Ph.D. in mathematics and sequentially dropped out of college. While this may not bother some investors, many people deem him unfit to lift Cardano to higher heights.
• Substantial Competition – The crypto space is an incredibly competitive industry, with new projects popping up almost every day. Cardano has not been progressing at the same speed as other cryptocurrency projects. Many consider it to be ‘behind’ the curve in terms of smart contracts and adoption.
• Significantly Smaller Ecosystem – One of the major hindrances surrounding Cardano is its tiny ecosystem in comparison to competitors. A flourishing ecosystem is especially important because it adds value and attracts retail investors, adoption, and developers to keep growing the ecosystem. Projects like Ethereum, Solana, and Avalanche have much larger ecosystems that are growing at a rapid speed.Once the project manages to expand its ecosystem, more developers will be incentivized to deploy projects on the Cardano blockchain, which should boost adoption.

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