Crypto Beginner

Top 10 facts about Cardano you should know

Top 10 facts about Cardano

Cardano is built to be accessible to both users and developers. It is eco-friendlier than other chains, and it has a vibrant and active community. One of the leading 10 cryptos by market cap, this is definitely a coin you need to learn more about. Here are the top 10 facts about Cardano you should know.

Introduction to Cardano: Everything you need to know

Launched in 2017, Cardano was developed by a group of scientists, programmers, and engineers who wanted to fix the shortcomings of blockchain platforms. And fix it did. Because this is a platform with a low carbon footprint and a focus on sustainability.

1. What is Cardano?

Cardano is a blockchain platform that hosts peer-to-peer conduct transactions and smart contracts. Because of its ability to host smart contracts, developers can use the platform to develop and run decentralized applications, or dApps. It validates all transactions using a Proof-of-Stake consensus algorithm.

With its layered architecture, Cardano separates the accounting of value from the execution of smart contracts. Compared to other blockchain platforms that use a single, monolithic blockchain to record and verify all transactions, the Cardano chain enables more security, scalability, and efficiency. The architecture also enables cross-chain transfers—a feature called interoperability.

There are three companies behind the platform—Emurgo, IOHK, and the Cardano Foundation.

2. Cardano’s purpose and function

As mentioned earlier, Cardano was designed for reliability, scalability, and longevity. Its primary functions are the hosting of transactions and the execution of smart contracts. It is also more flexible in a sense. Because it also works with other blockchain platforms and traditional financial systems—that is, it is interoperable.

3. Cardano as a decentralized platform

Cardano doesn’t rely on a single entity or central authority to perform the functions discussed above. Instead, it relies on a network of nodes/computers. Each computer contributes some of its computation power to keep the blockchain running. The block is essentially a digital ledger that records transactions.

Any of the network participants can view all transactions and smart contracts hosted on the blockchain. And any of them can verify transactional data. So each of the computers plays a role in keeping the system secure and reliable.

This way of operating where responsibilities are distributed across the network is called decentralization. It enables greater accountability and transparency. It makes it more challenging for malicious actors to take advantage of the system or commit fraud.

4. Cardano’s blockchain technology

The technology Cardano uses is supposed to make it more effective, scalable, and sustainable than other blockchains. Here’s where we tell you how.

Proof-of-Stake algorithm

A large majority of blockchains use a Proof-of-Work algorithm. But that can be energy inefficient and not so eco-friendly. So Cardano uses Ouroboros, a Proof-of-Stake algorithm. With Ouroboros, there is no need to rely on mining and mining rewards to find validators for transactions. The algorithm chooses validators from those with the highest stakes on the platform. Since everyone has a stake in the network, the validator—whoever they are—is motivated to ensure that there is no malicious or fraudulent activity.

And the rest of the stakeholders? Well, they are also more involved because Ouroboros gives them rewards for staking ADA and participating in the network.

Pluggable architecture

Unlike other linear networks, Cardano’s architecture is layered. That means the execution of smart contracts is separated from the accounting of value.

The architecture is pretty pluggable in the sense that it is adaptable and flexible. Integrating new features and capabilities as required is pretty easy. Because the platform is composed of modular parts that can all be replaced or upgraded without affecting the network as a whole, that means developers can quickly test and integrate new features without endangering the stability or security of the entire network.

This enables more innovation and experimentation. And it is what makes greater interoperability with other blockchain platforms possible.

5. Cardano’s smart contract verification process

One distinguishing characteristic that sets the Cardano crypto apart from others of its ilk is the formal verification of smart contracts. Formal verification is a process that ensures that the code is secure and free of flaws and errors. In other words, it mathematically proves its correctness.

This process boosts the security and dependability of Cardano’s smart contracts. It makes the contracts more resistant to attacks and exploits. Additionally, it also helps maintain the platform’s functionality and stability as new features and functions are added.

6. Cardano’s unique features

The layered architecture of Cardano, which separates the execution of smart contracts from the accounting of value, is one of its distinctive characteristics.

The use of a PoS consensus algorithm also makes for a more efficient and friendly environment. Because users can profit from staking their ADA and participating in the network, Cardano’s algorithm encourages greater stakeholder engagement and participation.

7. Cardano tokenconomics

Cardano’s native cryptocurrency is called ADA. Network participants use ADA to pay transaction fees and execute smart contracts.

Token supply and distribution

The maximum supply of ADA that the protocol allows to be in circulation is 45 billion. This helps the price of ADA not to fall too drastically. The current circulating supply of ADA is around 31 billion.

During the initial distribution of ADA in 2017, 31.1 billion tokens were put on sale. The funds raised from the sale were used to fund the launch and development of the platform.

Token price and market performance

Cardano’s price fluctuated between $0.02 and $1.21 per token over the past year. Additionally, ADA’s market capitalization has varied between $8.43 billion and $40.9 billion during the same period.

The all-time high price of Cardano as of 24 February 2023 is $2.92.

However, as with all cryptocurrencies, you should do your own research and assess your risk tolerance before investing.

8. Cardano’s use cases

A well-liked alternative to Bitcoin and Ethereum for investors looking to diversify their portfolios is the 2017-founded Cardano crypto. Cardano is a compelling option for both individuals and businesses because it offers several real-world use cases.

Decentralized Finance (DeFi)

One of the main applications of Cardano is in the field of decentralized finance. It helps improve the fairness and transparency of the financial system by doing away with middlemen.

dApps and smart contracts

Cardano’s blockchain technology also allows for the creation and execution of smart contracts and dApps. dApps function on decentralized networks like blockchains. They differ from conventional applications in that a network of nodes rather than a single entity controls them. Smart contracts are self-executing contracts. You can read more about them here.

9. Cardano’s community and development

The idea behind the platform began to be worked on in 2015, and it saw the light of day in 2017.

The development of Cardano and its community are two crucial components of the platform’s success.

Development team

Charles Hoskinson, a co-founder of Ethereum, leads the Cardano development team. The team includes over 200 developers and researchers from around the world.

Community and ecosystem

The Cardano community is a global network of investors, developers, and enthusiasts who are passionate about the technology and the vision of the project. This community is actively involved in the development and promotion of Cardano. They also offer valuable feedback and contribute to the growth of the ecosystem.

The Cardano community also participates in governance and decision-making through the Cardano Improvement Proposal (CIP) process. In addition, they are also active on social media and other online platforms—which makes all the difference.

10. Cardano’s partnerships and collaborations

To grow its ecosystem, Cardano has partnered with numerous organizations. In this section, we take a moment to recount some of these associations.

Strategic partnerships

Cardano has formed strategic partnerships with several leading organizations, including the Ethiopian government. Ethiopia is using this technology to track student performance and improve education outcomes. The University of Malta, too, relies on Cardano to develop a new academic credential verification system.

Other partnerships include the blockchain platform New Balance. New Balance collaborates with Cardano to track product authenticity using blockchain.

Collaborations in the blockchain space

Cardano is also collaborating with other blockchain projects to further advance the industry as a whole. For example, Cardano has partnered with IOHK to develop the KEVM, a test net that enables developers to write and test smart contracts using EVM.
Before we conclude, a word for those looking at how to buy ADA. The process is pretty straightforward. One option is to purchase the token on a crypto exchange using Bitcoin or another cryptocurrency. Another option is to purchase it directly with fiat currency via CoinSwitch.

FAQs

What is a fun fact about Cardano?

A fun fact about Cardano is that it was founded by Charles Hoskinson, one of the co-founders of Ethereum. After his involvement with Ethereum, Hoskinson went on to create Cardano with the aim of addressing some of the scalability and sustainability issues he perceived in existing blockchain platforms.

What is so special about Cardano?

It’s worth noting that the success and impact of any blockchain project, including Cardano, depend on adoption, community engagement, and the ability to deliver on its promises over time. The features mentioned contribute to what some consider unique or special about Cardano within the blockchain space.

What are the best things about Cardano?

It’s important to note that while these features are often praised, the success and long-term impact of Cardano depends on various factors, including adoption, community engagement, and the ability to address evolving challenges in the blockchain space.

What do you need to know about Cardano?

It’s important to stay updated on developments within the Cardano ecosystem, as blockchain technologies and projects are continuously evolving. Following official announcements, engaging with the community, and exploring reliable sources of information can help you stay informed about Cardano’s progress and advancements.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered investment/financial advice from CoinSwitch. Any action taken upon the information shall be at the user’s risk.

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