Today we will have a look at Cardano ADA; this coin has been in lots of talks.
For the latter half of 2017, cryptocurrencies were the trending topic. And because of proper reasons too. For the first time in years, cryptocurrencies enjoyed the attention of mainstream media.
This helped cryptocurrencies reach the common people who did not know about them, which helped these cryptocurrencies grow. I believe we will see this same trend in 2021 too.
Currently, we have thousands of cryptocurrencies to choose from. And this is where most newcomers get confused. Most of the newcomers know cryptocurrency through Bitcoin.
So when they see such a huge number of cryptocurrencies to choose from, they usually get overwhelmed.
Altcoins like Ripple, Cardano, TRON, etc. have performed way better than Bitcoin in 2017. So missing out on these popular altcoins will most likely decrease your profits.
So it’s better to know about them and analyze whether they should be invested in or not. In this article, I will talk about one of the most popular altcoins – Cardano ADA.
WHAT IS CARDANO (ADA)?
Cardano is a third-generation cryptocurrency that was developed from a scientific philosophy. Unlike most other cryptocurrencies, which have a policy of “doing and thinking,” Cardano is research-backed.
That is why ADA did not even have a proper roadmap, nor did it have a comprehensive white paper.
Instead, the team had some design goals and some inevitable features in mind that they wanted to incorporate in a new cryptocurrency.
They wanted to infuse engineering best practices into their project. They took their time to learn from other cryptocurrencies in the market and distinguished between necessary features and unnecessary junks.
One of the main developers behind the Cardano project is Charles Hoskinson of IOHK. Charles has worked with the Bitcoin development team and Ethereum board in the past.
So you can safely say he knows what he is doing.
Currently, Cardano is the cryptocurrency with the fifth highest market cap. It has a market cap of $31.7 billion, quite an impressive feat for a cryptocurrency that was launched in late September 2017.
The price of 1 ADA is $1.23, making it a great cryptocurrency for newcomers.
WHAT ARE THE FEATURES OF CARDANO?
Cardano is still in its development phase.
That is why quite a few promised features of Cardano are still not available. But let’s talk about them anyway as these are on the line.
BUILT FROM SCRATCH, SUPPORTED BY RESEARCHERS
The Cardano foundation created the Cardano cryptocurrency from the ground up. They surely borrowed some of the existing ideas for creating a cryptocurrency.
But they implemented them in their own ways. Most of these features were reviewed by blockchain experts and academics to ensure their effectiveness.
When it comes to smart contracts, even beginners know Ethereum is the market leader. But the main drawback of Ethereum is that it runs both the smart contracts and transactions in one blockchain.
This can congest the network and slow it down beyond expectation. We are no stranger to these kinds of slowdowns of the Ethereum blockchain.
Cardano proposes that the solution to this problem is to break the entire blockchain into layers. So by definition, Cardano has two layers – the Cardano Settlement Layer and the Cardano Computational Layer.
The Cardano Settlement Layer deals with typical blockchain activities like transactions. And the Cardano Computational Layer deals with more demanding tasks like smart contracts. This makes the whole network more flexible and modular.
Cardano also wants to introduce some governance and regulation system. The idea of cryptocurrency governance is nothing new, and Dash is a great example.
But the Cardano Foundation claims that its governance system will be more sophisticated and cryptographically secure. The plan is to set aside a portion of the newly minted ADA to fund the Cardano treasury.
Depending upon user votes, this fund can be used to finance certain development projects. Needless to say, Cardano will take measures to refrain from using this fund for personal reasons.
OUROBOROS PROOF OF STAKE
Like many other cryptocurrencies such as Ripple, NEO, Stellar, IOTA, etc., Cardano uses proof of stake. Proof of stake allows the cryptocurrency network to verify transactions without wasting too much computational power like mining or proof of work.
Researchers developed Cardano’s proof of stake algorithm called Ouroboros.
A group of extremely talented cryptographers from five academic institutions led by Professor Aggelos Kiayias of the University of Edinburgh created the Ouroboros proof of stake algorithm for Cardano.
This PoS algorithm was also peer-reviewed by academics from all around the world.
EASIER YET EFFECTIVE SCRIPTING
There is a common misconception among cryptocurrency enthusiasts that Bitcoin doesn’t support smart contract scripting. In reality, you can create smart contracts on Bitcoin’s blockchain too, but it is a more tedious and complex process.
Ethereum makes it easier by introducing its own set of programming languages like Serpent, Solidity, etc. But this has made the whole process more complicated than expected. Plus, these programming languages are only useful for Ethereum and nothing else.
Cardano is trying to combat this issue by introducing their own domain-specific programming language Simon. It was created by Simon Thompson based upon Composing contracts. This programming language’s main goal is to reduce the whole set of compound financial transactions into a collection of foundation elements. From these foundation elements, one can create any financial transaction. This way, the use of this programming language will make the creation of smart contracts much easier.
It goes without saying that a cryptocurrency so advanced and researched will try its best to be scalable. Cardano claims that most cryptocurrencies don’t have the provisions for scaling them further in the future.
This is because most cryptocurrencies are based on an immutable append-only data structure called the blockchain. Although Cardano uses the blockchain, its Ouroboros PoS allows it to be highly scalable. Cardano also has provisions for future soft and hard forks.
Apart from these features, the Cardano blockchain also supports sidechains, signature, and user-issued assets, to name a few.
Cardano’s impressive feature set and philosophy make it one of the best cryptocurrencies in the market.
HOW TO BUY CARDANO? (Binance)
Cardano is not as easy to buy as Bitcoin or Ethereum. You cannot buy Cardano with your traditional currencies through bank transfer or credit cards. Instead, you will need to exchange your BTC, ETH, or XRP to ADA.
If you do not have any cryptocurrencies at the moment, you can buy BTC or ETH very easily. Just head over to Coinbase and create an account.
After funding your account, head over to the Binance exchange platform and select ADA/BTC market. On that page, you can buy ADA in exchange for your BTC.
WHERE TO STORE CARDANO?
Now that you have bought some ADA, it’s time to store them. If you don’t have a lot of ADA now, then I don’t recommend installing a dedicated wallet. You can store them on the exchange without any worries.
But if you are heavily invested in Cardano, then it’s a good practice to move them to a wallet where you control the private keys.
Currently, Cardano has only one wallet. It’s a desktop wallet called Daedalus which also has support for paper wallets.
Right now, not a single hardware wallet supports Cardano because of its complex structure. The Daedalus wallet is only available for Windows and macOS machines at the moment.
The Daedalus wallet is an extremely well-rounded wallet with a lot of features like –
- Ability to run DApps, making it a smart wallet.
- Encrypts private keys and spending passwords to make it secure from malware attacks.
- Ability to export paper certificate so that you can “cold store” your funds.
- Ability to redeem funds.
The Daedalus development team also looks forward to adding new features like multi-currency support, staking feature, community-run application store, etc.
For more information and download links, please visit: Daedaluswallet.io
But, you can always store it on an exchange like Binance.
SHOULD YOU BUY CARDANO? – FINAL WORDS
Right now, all I can say is that Cardano feels extremely professional. Most of the cryptocurrencies in the market lack in this department because they are run by decentralized teams of developers.
But the Cardano Foundation works like a large corporate with big ideas and a solid plan to implement those ideas. One of the main goals of Cardano is to create trust among big investors to invest in cryptocurrencies.
Moreover, for a cryptocurrency so young, Cardano (not even six months old) has an impressive market cap of $35 billion. This proves that people have trust in Cardano and want to see it grow even more.
So it doesn’t matter whether you are a short-term investor or a long-term; right now, Cardano is a great investment option. So my suggestion would be to buy it but carefully.
Be extremely careful when dealing with cryptocurrencies. Because investing in cryptocurrencies is extremely risky. It’s your duty to research yourself and do your due diligence.