Cardano (ADA)
Cardano is a decentralized blockchain platform that uses a proof of stake (PoS) consensus mechanism, making it an efficient alternative to proof of work (PoW) networks. The native cryptocurrency of Cardano, ADA, is integral to its PoS system, rewarding users who participate in stake pools. As of February 2022, Cardano reached a significant milestone with over three million wallets, a notable increase since December 2020. The Alonzo upgrade further enhanced its capabilities by introducing smart contract functionality, allowing for the deployment of over 1,000 smart contracts by early 2022.
History of Cardano
| Ticker | ADA |
| Category | Smart Contract Platform |
| Website | https://cardano.org/ |
| @Cardano_CF | |
| Telegram | Cardano |
| https://www.reddit.com/r/cardano |
Cardano was initiated in 2015 by Charles Hoskinson, a co-founder of Ethereum, and launched in 2017. It was named after Gerolamo Cardano, a 16th-century Italian polymath, while its native token, ADA, is inspired by Ada Lovelace, considered the first computer programmer. Cardano is positioned as an alternative to Ethereum, focusing on smart contracts and decentralized applications (DApps). The platform's development began with Hoskinson's early interest in cryptocurrencies, which led to the creation of an educational course on Bitcoin in 2013. Cardano's journey continued with the Alonzo hard fork in 2021, which introduced smart contract functionality.
Blockchain infrastructure
Cardano's blockchain infrastructure consists of two primary layers: the Cardano Settlement Layer (CSL) and the Cardano Computational Layer (CCL). The CSL is responsible for handling digital asset transactions and is based on the Ouroboros PoS consensus algorithm. It separates transaction value from computational data to enhance scalability. The CCL serves as the network's "brain," supporting smart contracts and enabling programmable tokens. It aims to replicate the smart contract platform of the Bitcoin ecosystem and adapt to future technological advancements.
ADA token and tokenomics
The ADA token, named after Ada Lovelace, plays a crucial role in the Cardano network. It was introduced through an Initial Coin Offering (ICO), raising $62.2 million, with 57.6% of the total supply distributed to investors. ADA holders can participate in staking to earn rewards and have a say in the network's governance. The maximum supply of ADA is capped at 45 billion, and as of November 2022, 34.4 billion ADA were in circulation. The distribution included allocations to IOHK, EMURGO, and the Cardano Foundation.
Staking in Cardano
Staking process
In Cardano's PoS system, staking determines a node's ability to validate blocks on the blockchain. Users can pledge ADA as a stake, which is secured and cannot be spent. Staking rewards are distributed based on the amount of ADA staked. Users can participate in staking pools, which are groups of ADA holders collaborating to validate transactions and earn rewards.
Cardano staking pools
Cardano employs a PoS consensus algorithm where users stake ADA to become validators. Users can participate by operating a stake pool or delegating ADA to an existing pool. Stake pool operators manage the pool by maintaining servers, monitoring nodes, and overseeing administrative tasks.
Cardano technology
The Ouroboros consensus protocol
Cardano is powered by the Ouroboros consensus protocol, the first PoS protocol designed to reduce energy consumption compared to PoW mining. Developed during Cardano's foundation, Ouroboros minimizes the reliance on processing power, making it an efficient solution for securing the network.
Alonzo upgrade
The Alonzo upgrade, launched on September 12, 2021, introduced smart contract capabilities to the Cardano blockchain. Named after mathematician Alonzo Church, this upgrade enabled the development of decentralized applications, non-fungible tokens (NFTs), and smart contracts. Charles Hoskinson likened the upgrade's impact to the introduction of JavaScript for web development.
Vasil hard fork
The Vasil hard fork, implemented on September 22, 2022, aimed to enhance Cardano's scalability and transaction throughput. It introduced diffusion pipelining to improve block propagation times and implemented key Cardano Improvement Proposals (CIPs) for governance, network protocol, and smart contracts.
Cardano DEX projects
Cardano has several decentralized exchange (DEX) projects, including CSWAP DEX, WingRiders, Spectrum Finance, Axo, Minswap, Ray Network, SundaeSwap, and Cardax. These projects contribute to the growing ecosystem of decentralized finance on the Cardano platform.
The Cardano Foundation
Role and partnerships
The Cardano Foundation is an independent body overseeing Cardano's development and ecosystem. It focuses on adoption, partnerships, community growth, legislative shaping, and stakeholder accountability. Notable partnerships include collaborations with the Ethiopian government for blockchain-based IDs, Veritree for reforestation records, DISH Network for digital identity services, and esports company Rival for NFT minting and distribution.
Cardano team
Foundation board members
The Cardano Foundation board includes Theo Kocken as Chairman, Arjan Erkel as Vice Chairman, Carolijn Gommans as a Supervisory Board Member, and Tamara Monzon as a Supervisory Board Member.
Cardano development team
Key members of the Cardano development team include Frank Gosselink and Joost Zuidberg as CEOs, Joris van Oppenraij as Senior Project Manager, Fleur Henderson as Senior Project Director, and Jan van der Beek as Financial Controller.
Roadmap of Cardano
Development phases
Cardano's development roadmap consists of five primary stages, known as "eras": Byron, Shelley, Goguen, Basho, and Voltaire. Each era focuses on specific aspects such as network foundation, decentralization, smart contracts, scaling, and governance. As of November 2023, Cardano is in the Basho phase, working on scalability and interoperability through sidechains and the Hydra upgrade.
Byron: Foundation
The Byron era marked Cardano's initial development and launch of the ADA cryptocurrency. It introduced the Ouroboros PoS consensus protocol and focused on building a community and technical foundation. Official ADA wallets, Daedalus and Yoroi, were released during this period.
Shelley: Decentralization
The Shelley era aimed to decentralize the network by encouraging community participation in node operation. It introduced incentivization and delegation schemes, increasing ADA staking in various pools. Upgrades to the Ouroboros protocol enhanced security and network efficiency.
Goguen: Smart contracts
The Goguen era focused on integrating smart contracts and decentralized applications (DApps) into the Cardano blockchain. It introduced the Plutus development language and Marlowe, a language for financial contracts. This era marked the beginning of Cardano's decentralized finance (DeFi) capabilities.
Basho: Scaling
The Basho era aims to enhance the network's performance, operability, and scalability. Key developments include sidechains for increased capacity and the Hydra upgrade to address throughput issues. Basho focuses on improving the network's resilience and flexibility.
Voltaire: Governance
The Voltaire era introduces governance and a treasury system to make Cardano self-sustaining. Participants can vote on Cardano improvement proposals (CIPs) and contribute to a treasury for development activities. This era marks the final step towards full