Cardano (ADA): 5 key points you should absolutely know before considering investing in ADA

Cardano is a layered decentralized blockchain that aims to provide advanced features never before seen. The so-called “third generation” environment includes contract functionality and has its own cryptocurrency for exchanges: ADA.

Cardano (ADA): the basics to know

1 – What is Cardano Encryption (ADA)?

  • Basic principle: Cardano is a layered decentralized blockchain project that aims to provide unprecedented advanced features. This environment has the peculiarity of emanating from a very large group of engineers and researchers to ensure that the blockchain can be easily improved and modernized using soft forks.
  • Uses : Cardano has its own “ADA” token, which in particular allows for asset transfers to be run. The environment also has other integrated uses (smart contract, apps, etc.) that will be activated as the ecosystem evolves.

2 – The project and the blockchain behind Cardano

  • project : Cardano intends to address the scalability problem faced by traditional blockchains (such as Ethereum and ever-increasing gas fees). To do this, and by using cutting-edge mathematics and new technologies, Cardano aims to create a new form of what is called a “third generation” blockchain infrastructure.
  • Blockchain: To achieve this, five main steps have been identified. All of them participate in weaving the network, which eventually leads to a fully decentralized network.
    • Phase 1 “Byron”: Starting the network with basic functions such as converting ADA tokens.
    • Phase Two “Chile”: implementation of decentralization with a community-managed contract.
    • The third stage “Goguen”: activating smart contracts on the network.
    • Phase 4 “Basho”: In order to improve the scalability and interoperability of the network, side chains (side chains) were introduced.
    • Fifth stage “Voltaire”: complete the decentralization of the network with the addition of governance and self-financing.

3 – Analysis and opinion on Cardano (ADA)

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  • The “third generation” blockchain solves the scaling issues typically associated with first generation (Bitcoin) and second generation (Ethereum). Concretely, transactions per second are more numerous and make it possible to reduce costs thanks to a proven stack protocol called Ouroboros.
  • This ecosystem uses a Proof of Stake (PoS) consensus that consumes much less power than the Proof of Work (PoW) algorithm found in other decentralized networks (up to 4 times more energy efficient than Bitcoin).

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The –

  • The operation of its blockchain system is particularly complex, which penalizes the implementation of the various required functions. As such, the launch of Phase 3 “Goguen” that allows developers to create and feed smart contracts and decentralize applications (dApps) has had some hiccups.

4 – How to earn or mine Cardano (ADA)?

When it comes to mining, Cardano relies on the Proof of Stake consensus protocol to verify and verify transactions. Thus, participants who put their ADA on the Cardano blockchain will be able to enjoy additional token rewards.

Besides, Cardano is one of the most popular bet cryptocurrencies in the market. More than 2,000 pools exist within the blockchain dedicated to betting. This is because the Cardano network is completely decentralized and wholly owned by the community of its owners.

5- Useful resources

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