In addition to stocks, gold, and property, digital currency is an investment option that is quite tempting. Apart from the popular Bitcoin, Cardano or (ADA) cryptocurrency is a cryptocurrency that offers attractive advantages. Not only is the price still relatively cheap, but Cardano also uses technology that ensures the security and ease of mining and transaction processes.
Cardano is a blockchain that uses PoS or proof of stake technology in addition to Bitcoin and Ethereum. Cardano has a blockchain network that is considered the most environmentally friendly and also secure, and because of that Cardano is often referred to as the third generation blockchain and Cardano itself in September 2021 has just started to have an active smart contract feature.
The Cardano team in developing their products uses a peer review approach where every new feature and change that is developed before being implemented will be reviewed by experts and academics. This is what makes Cardano unique. The crypto asset network that supports Cardano’s operations is called ADA. ADA itself is the world’s 4th largest crypto asset as it has a market cap of 71 billion dollars and has 33 billion coins on the market with a maximum supply of 45 billion ADA coins, according to Coinmarketcap as of October 2021.
Read More: What Is Polygon (Matic)?
What Is Cardano?
Cardano is the world’s first peer-reviewed blockchain. The people in charge of the Cardano organization are academics and scientists who actively reviewed this blockchain protocol before it was released. Cardano belongs to the third generation of cryptocurrencies, so it is considered one of the most up-to-date today. With advanced technology, he is believed to be able to provide solutions to many problems experienced by Bitcoin and Ethereum miners as the first and second generation of cryptocurrencies.
Apart from that, Cardano is also known as a Proof of Stake (PoS) cryptocurrency. Proof of Stake is one of the two mechanisms for regulating cryptocurrency transaction processes. This mechanism is a development of its predecessor, namely Proof of Work. With the PoS mechanism, this protocol allows mining based on the number of coins it has. So, the system is more efficient.
What Is The Cardano (ADA) Roadmap?
The Cardano roadmap gives the name inspired by the names of well-known British writers for the divisional stage of product development.
- Byron: This stage is the foundation phase that implements of ADA transaction.
- Shelley: Cardano’s decentralized development via the proof of stake algorithm and ouroboros system.
- Goguen: Creating applications on the Cardano blockchain by implementing smart contracts.
- Basho: This is the stage where the network focused on improving Cardano’s scalability and interoperability with other blockchains is optimized.
- Voltaire: Transitional stage of development and governance from Cardano which was originally organized within the organization to become community-based.
How Does Cardano Work?
Cardano uses a Proof of Stake consensus mechanism by utilizing the Ouroboros algorithm.
Proof Of Stake (Pos)
The ADA coin, unlike bitcoin, requires miners to mine but instead uses a Validator that is selected based on the number of ADA asset holdings by the network. They risk ADA to verify all transactions in the block and will get ADA incentives when validator block verification is correct.
Ouroboros is a blockchain protocol created through a research process reviewed by academics or peer review that is run on the Cardano network system algorithm. ADA uses this algorithm to create a new ADA, perform transaction validation, and secure transactions.
This system divides several parts into squares called epochs and slots. An epoch is a large box that contains several slots in it and each slot has a slot leader whose role is to verify the creation of new blocks. The epoch will be declared complete and the slot leader can choose the next slot leader when all slots in the epoch have been successfully verified by the network.
The verification system is considered more environmentally friendly and low emission because each slot leader in the epoch that can verify transactions is limited in number and is carried out randomly according to the Ouroboros algorithm. This is what distinguishes it from proof of work in the unlimited number of transaction verification processes which can lead to high computational energy consumption.
Cardano has its crypto asset called ADA. The coin currently has 2 main utilities. First is utilized as gas fees, which is to pay transaction fees in a blockchain. Second, it is staked by delegators (and validators) who desire to help maintain the stability and security of the network in exchange for rewards.
In the future, ADA will also be used as a governance token, allowing holders to vote on changes and upgrades to the Cardano platform. Currently, ADA is still ranked in the top 10 by market cap according to coinmarketcap. with an immediate market cap of $32,093,857,867 USD. The total supply of circulating coins is 33,752,555,544 ADA coins with a maximum supply of 45,000,000,000 ADA coins.
ADA coins can be used for staking to get passive income, besides that these coins are also used for transactions (gas fees) for the NFT platform in collaboration with the Cardano blockchain.
Based on the description above, it can be concluded that Cardano (ADA) is a third-generation cryptocurrency that offers many benefits. As a cryptocurrency that is considered the most up-to-date, it is trusted to provide solutions to various problems experienced by Bitcoin and Ethereum enthusiasts. Cardano is a Smart Contract platform like Ethereum or NEO that makes it easy to create new tokens and is a DApps (Decentralized Applications). There are more than 60% Ada tokens allocated during the ICO stage.
Cardano ADA token holders can earn more tokens by validating future block transactions, can receive some block rewards and a small share of network fees and Cardano holders can vote for protocol changes, which makes the Blockchain system more flexible and also liquid. Ada tokens will be needed for future applications, so the Ada token value has the same characteristics as Ethereum. It is important to note that currently, ADA is one of the 10 biggest crypto asset market caps, which placed in 6th place (9/6/2022).