Cardano (ADA): What it is, how it functions, and its special features

Cardano is a successful crypto project that was developed in 2015 and has attracted a lot of attention from the general public. Similar to Ethereum, Cardano is a platform that allows the creation of decentralized applications powered by the native token of the platform, ADA. The names selected both for Cardano and its native currency are not a mere occurrence, but they have a meaning. For example, the Cardano blockchain was named after Girolamo Cardano, an important personality in physics. He has the crucial merit of having an essential contribution to information technology. 

The digital token name has also been selected with consideration, as Ada Lovelace inspired this digital coin, who is the first computer programmer. ADA plays an important role in the Cardano ecosystem, as it powers this platform. Additionally, ADA is used for the services and applications that are available on Cardano. Owning ADA offers many use cases to participants, as they can interact with smart contracts, access NFT marketplaces, decentralized finance (DeFi), and so on. Thanks to the vast list of potential uses, the ADA price prediction shows that the value of this digital coin can increase in the future. 

In this article, we will explore Cardano and its native token, ADA. Keep reading to learn more. 

What exactly is Cardano (ADA)? 

The idea of Cardano first appeared when Charles Hoskinson, one of the co-founders of Ethereum, disagreed with its direction. As a result, Cardano started to create its own platform. Cardano was first developed in 2015 and minted its first block in 2017. It wanted to be an improved alternative to Ethereum and represent a "third-generation" platform compared to Ethereum's "second-generation" possibilities. 

Over the years, Cardano has gone through many changes to become the platform that supports many capabilities today. For instance, Cardano needs to go through five primary stages on the Cardano roadmap to help this platform reach new heights. Here are some of these phases: 

• Phase 1: Byron, when Cardano was launched together with basic functions. 

• Phase 2: Shelley, to incorporate decentralization with the help of community-run nodes. 

• Phase 3: Goguen to integrate smart contracts into the platform. 

• Phase 4: Basho, which offers Cardano better interoperability and scalability, as this phase brings sidechains. 

• Phase 5: Voltaire, where Cardano wants to become fully decentralized. 

How does Cardano function? 

Cardano was created to fix Ethereum's shortcomings, especially since this digital currency wanted to be a "third-generation" blockchain. So, only with this characteristic did Cardano wish to correct the deficiencies associated with generation one, offered by Bitcoin, and generation two of Ethereum. Both Ethereum and Bitcoin usually provide a small number of transactions per second (TPS) and high transaction fees. This is why Cardano wanted to put a stop to these limitations and improve what the other blockchains weren't able to. 

This is why Cardano aims to offer better solutions, such as low fees, truly decentralized features, and a high TPS. Cardano uses a Proof-of-Stake (PoS) consensus protocol named Ouroboros. It uses mathematical features and cryptography to ensure the integrity of the platform. What is special about Ouroboros is that it doesn't imply high energy costs, is present in the Proof-of-Work (PoW) consensus mechanism, and also has a high-security association. 

The Cardano project's layer two solution is Hydra, which aims to offer infinite scalability and increase throughput. Another special feature of Cardano is that it uses the Hard Fork Combinator, which allows the network to undergo many hard forks without interrupting the blockchain experience. 

What are the unique features of Cardano? 

Ouroboros

Ouroboros is an important and unique feature of Cardano that prioritizes safety. For example, Ouroboros uses mathematical security when selecting blockchain validators, which is different from the way the rest of cryptocurrencies do this. The majority of blockchains choose validators randomly, but Ouroboros wants to offer a fair chance to all stakeholders to mine blocks and receive an award for this action. Thanks to the PoS, Cardano manages to eliminate the high need for computational power and offers more fairness, which needs to be appreciated. 

Daedalus wallet

Compared with other digital coins, Cardano also managed to integrate its own wallet into the platform. So, Cardano users also receive the possibility to own a special wallet, where they can keep their digital coins safely and ensure that nothing bad occurs to them. This offers more transparency in the Cardano blockchain and can also enhance participants' trust. 

In addition to keeping their ADA tokens safe, the Daedalus wallet allows users to participate in the staking processes from this platform. Holders can also receive rewards if they decide to support the network, validate transactions, and stake their coins. 

What are the use cases of ADA? 

ADA is the native token of Cardano, and it offers many use cases to owners. For example, ADA can be used to buy different services and products. Other than this, with the help of ADA, crypto owners can also verify transactions and receive rewards in the form of ADA for their efforts. This is why Cardano can offer the possibility of earning free tokens in exchange for maintaining the security of the platform and ensuring active participation. 

Another important feature of Cardano is that it can be used for governance and voting. ADA owners can have a say in the direction of the platform and give their ideas on how to enhance it. With the release of new upgrades, Cardano can also have even more use cases, as it can power smart contracts on this blockchain. 

The bottom line

Cardano has proved to be a significant crypto project with the potential to increase even more in the future and bring new advantages to this space. This is one feature that makes Cardano unique and a reason that can push this digital coin even more into the mainstream. Even though we can’t pinpoint exactly what the future of Cardano will bring, we can only hope for the best.