To understand the blockchain is first to appreciate its creators and second, to admire its value proposition.
From the first proof-of-concept in Bitcoin to the sophistication of subsequent iterations rolling out creations like smart contracts, crypto is markedly different and dense with activity and unparalleled innovation.
Users are spoilt for choice in the age of smart contracting punctuated with marvels like crowd-funding models, DeFi, and NFTs.
Ethereum stands out. However, emerging platforms promise better, resolving some of the major pain points that have slowed down progress in the last few years.
Of the many, Cardano stands out. This guide breaks down what Cardano is, its relevance, and why it has gained so much traction since launching.
Introducing Cardano
Cardano is a creation of Charles Hoskinson.
He’s a serial innovator in blockchain and smart contracting circles. If anything, he’s credited as one of the co-founders of Ethereum and went on to form a big part of Ethereum Classic (ETC).
ETC is the hard fork of Ethereum and the most prominent one following the DAO hack of 2015, where millions of ETH were locked, jeopardizing the network’s progress.
Charles Hoskinson spearheads the Input-Output Hong Kong (IOHK), the central development unit of the Cardano blockchain. It is tasked with delivering quality, robust, and thoroughly tested code.
Emurgo, the business development wing, and the Cardano Foundation advocate Cardano, promoting its features. Emurgo is a global blockchain company with offices in several countries, including Singapore and Japan. It ensures Cardano connects with enterprises. Therein, the Cardano network can be leveraged to provide tailored solutions.
Prioritizing Research and Code Quality
Cardano differentiates itself from other competing blockchains like Ethereum and Bitcoin, for instance.
Specifically, Cardano is open source, and its code is accessible to the public.
However, what’s truly unique about this network is its inclination to peer-review, laying emphasis, above all, on quality over quantity and speed.
For this reason, the project was built from the ground up. The development team identified weaknesses in the present architecture.
To resolve energy inefficiency, a subject of contention in crypto fora, the team opted for Proof-of-Stake—diverging from the Proof-of-Work model used by Bitcoin and Ethereum.
Due to their peer-review and angling for research, IOHK is the first to release a white paper detailing Sidechains for Proof-of-Stake-powered public ledgers.
Cardano Multi-stage Development
Eventually, Cardano plans to support smart contracting. There are five meticulously drafted stages towards achieving this novel objective.
Two phases are complete—Byron and Shelley. Three remains—Goguen, Basho, and Voltaire.
In the final phase, Voltaire, Cardano will be scalable, energy-efficient, secure, and supportive of flexible smart contracts carved to handle financial transactions.
At present, Cardano has concluded two phases—Byron and Shelley.
During the Byron stage, the goal was to develop their two base layers. The Cardano Settlement Layer (CSL) acts as a unit of account and where users can send and receive ADA instantaneously.
The Cardano Computational Layer (CCL) is the core of the public ledger. This is where smart contracts will operate compliantly, securely, and to allow for enhancement.
At the Shelley stage, Cardano developers focused on decentralizing and staking.
There are over 1,000 staking pools in Cardano, making it one of the most decentralized Proof-of-Stake networks.
Cardano Preparing for Smart Contracts
As we advance, Cardano developers are preparing for the Goguen phase set for September 2021. At this phase, the objective will be to activate smart contracting.
Smart contracting via Cardano is executed in phases. There were three hard fork combinator (HFC) processes. Recently concluded was Mary.
In the final HFC, Alonzo, Cardano developers will merge Goguen, ushering in a new phase and cementing the position of Cardano as one of the most actively developed and valuable projects.
Preceding this, however, was the launch of native assets, which allowed creations like NFTs.
Conclusion
In anticipation of this hard fork, ADA—Cardano’s native currency–is resilient and perched at fifth as per the market cap leaderboard. Thus far, it is up 16X year-to-date.
Traders expect ADA to rally to new 2021 highs as IOHK meets milestones and gradually improves the platform’s array of features.
