Learn about Cardano (ADA) and the public blockchain behind it

1. What are Cardano (ADA) and Cardano?

Cardano (ADA) is the native cryptocurrency of the Cardano blockchain. It plays an important role in the Cardano ecosystem, including the role of currency and staking within on-chain applications.

The Cardano blockchain platform was developed and launched in 2015 by Charles Hoskinson (former co-founder of Ethereum). Hoskinson believes that the proof-of-work (PoW) consensus mechanisms of Bitcoin and Ethereum are not only resource-intensive but also have limited transaction processing speeds. Therefore, he established a new consensus mechanism based on Proof of Stake (PoS) on Cardano and adopted a two-layer blockchain architecture, which significantly improved the speed of operation.

Based on the PoS consensus mechanism, the computing speed of the Cardano blockchain can reach about 250 transactions per second, greatly improving the efficiency of on-chain transactions.

2. Why is Cardano called the “Japanese Ethereum”?

The reason why Cardano is called the "Japanese Ethereum" is mainly due to its initial fundraising method. Most cryptocurrency projects raise funds publicly through ICOs, but Cardano uses private fundraising, and more than 90% of the funds come from Japan, hence the name.

3. The motivation for the birth of Cardano: solving the problems of Bitcoin and Ethereum

The main purpose of Cardano and ADA is to solve two major problems of Bitcoin (BTC) and Ethereum (ETH):

  1. Network congestion: During peak transaction times, the Bitcoin and Ethereum networks are prone to congestion.

  2. Poor interoperability: Bitcoin and Ethereum both have independent blockchain platforms that are not interoperable with each other, and have experienced multiple forks due to differences in community opinion.

Cardano was created to solve these two problems.

4. Cardano’s Three Major Reforms: Becoming the Latest Third-Generation Blockchain Platform

  1. Scalability：
    The Cardano team developed an algorithm called Ouroboros, a provably secure PoS protocol that solves the problems of network congestion, transaction inefficiency, and limited scalability.

  2. Interoperability：
    Cardano can achieve interoperability between different blockchains through side chains, ensuring the security of cryptocurrencies.

  3. Sustainability：
    The Cardano platform maintains operations by charging transaction fees and has designed a constitution-like "Cardano Improvement Proposal" to avoid community forks.

5. Five major development stages of ADA coin: promising future

The development roadmap officially announced by Cardano is divided into five phases, each focusing on different development goals:

  1. Byron (Infrastructure)：
    During this phase, Cardano’s underlying blockchain programming language will be developed to establish the foundation for the third-generation blockchain ecosystem.

  2. Shelley (decentralized)：
    In this phase, the core of the system will be decentralized and the ADA mining mechanism will be improved. Anyone holding ADA can participate in mining.

  3. Goguen (Smart Contracts)：
    The current research topic is mainly responsible for the development and optimization of smart contracts.

  4. Basho (Extensibility)：
    Optimize the scalability and interoperability of the network and improve the efficiency of the platform in processing data.

  5. Voltaire (Governance)：
    The final stage is governance, which allows coin holders to vote on the platform according to their holdings to achieve true equality on the chain.

in conclusion

Cardano's three major reforms and five major development phases have made ADA coin rise rapidly and become one of the top ten cryptocurrencies in the world. Its innovative PoS consensus mechanism and two-layer blockchain architecture not only solve the key problems of Bitcoin and Ethereum, but also lay a solid foundation for the future development of blockchain.

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