What Is Cardano?
Cardano (ADA) is a decentralized platform that will allow complex programmable transfers of value in a secure and scalable fashion. Founded by Charles Hoskinson, its development started in 2015, and it then raised around $60 million in an ICO in 2017 before its release. Hoskinson was also one of the founders of Ethereum. Cardano is reportedly the first blockchain platform to evolve out of a scientific philosophy and a research-first driven approach, and one of the first to be built in the Haskell programming language. Cardano is developing a smart contract platform which seeks to deliver more advanced features than any protocol previously developed. The development team consists of a large global collective of expert engineers and researchers. The protocol reportedly features a layered blockchain software stack that is flexible, scalable and is being developed with the most rigorous academic and commercial software standards in the industry. Cardano will use a democratic governance system that allows the project to evolve over time, and fund itself sustainably through a treasury system. Cardano also notes that it will combine users’ need for privacy with regulation, so that Cardano’s style of regulated computing will foster greater financial inclusion.
Cardano is supported by three organizations that are separate in both ownership and leadership. The Cardano Foundation is an independent, Swiss-based organization that oversees the development of the Cardano ecosystem, IOHK designs and builds Cardano and Emurgo is the for-profit arm that supports Cardano with commercial ventures. Cardano’s roadmap for development has been divided into five eras: Byron, Shelley, Goguen, Basho and Voltaire. While each separate era has its own set of functionalities that will be developed and supported in multiple code releases in a sequential order, the development of each era is parallel and simultaneous across the different systems. Cardano also has its own block explorer, which allows users to check the history of ADA transactions that are publicly recorded on the blockchain.
How Do You Mine or Stake Cardano?
Cardano does not run on a proof-of-work blockchain like Bitcoin. Instead, Cardano has a proof-of-stake algorithm known as Ouroboros, which works in a specific way as compared to most proof-of-stake algorithms. Ouroboros divides up time slots called “epochs,” which can be compared to working a shift. Each epoch is led by one elected slot leader who is responsible for creating and confirming blocks in the Cardano blockchain. If one slot leader does not create a transaction block in their epoch, the next “shift” leader will try, with a minimum of 50 percent or more of the blocks produced within one epoch. The transactions in the blocks created by slot leaders are then approved by input endorsers, who are elected based on stakes. There can be more than one input endorser in each epoch.
The Ouroboro rewards system has incentives for availability and transaction verification, as opposed to using large amounts of power to mine coins like in proof-of-work. The rewards given for participating in the Cardano blockchain are split between three stakeholders: input endorsers, multiparty computation stakeholders, and slot leaders. Cardano staking is a feature of the Shelley era of the roadmap. The Shelley Incentivized Testnet, live in May 2020, allows ADA holders to earn rewards by either delegating their stakes or running a stake pool.
How do I buy cryptocurrency?
While some cryptocurrencies, including bitcoin, are available for purchase with U.S. dollars, others require that you pay with bitcoin or another cryptocurrency.
To buy cryptocurrencies, you’ll need a “wallet,” an online app that can hold your currency. Generally, you create an account on an exchange, and then you can transfer real money to buy cryptocurrencies such as bitcoin or ethereum.
Coinbase is one popular cryptocurrency trading exchange where you can create both a wallet and buy and sell bitcoin and other cryptocurrencies.