March 20, 2018

The Most Straight Forward Guide To Cardano (ADA) In Cryptocurrency

Cardano is a smart contract platform, similar to Ethereum, with a focus on security through a layered architecture. It’s the first blockchain project to be created from scientific philosophy and built on peer-reviewed academic research.

The ticker symbol for Cardan is $ADA.

According to its website, ADA is the only coin with a “scientific philosophy and research-driven approach.”

The non-profit foundation that runs Cardano has also partnered with a bunch of academic institutions to research and review all aspects of its blockchain. For example, researchers at Lancaster University are developing a “reference treasury model” to find a sustainable way to fund future development for Cardano’s blockchain.

 

How does Cardano work?

Cardano is being developed in two layers that separate the ledger of account values from the reason why values are moved from one account to the other. This separation enables the smart contracts that are written on the platform to be more flexible.

Businesses can take advantage of this separation to tailor the design, privacy, and execution of each contract to more perfectly fit their specific use-cases.

Cardano Settlement Layer (CSL)
The CSL acts as the balance ledger and is the first layer of the platform. Created as an improvement to Bitcoin, this layer is a cryptocurrency built from the whitepaper “Ouroboros: A Provably Secure Proof of Stake Blockchain Protocol” by Aggelos Kiayias.

The CSL uses a proof-of-stake consensus algorithm to generate new blocks and confirm transactions.

Cardano Computation Layer (CCL)
The CCL is the second layer of the Cardano platform and contains the information on why transactions occur.

Because the computation layer is detached from the CSL, different users of the CCL can create different rules when evaluating transactions.

For example, you could create a permission ledger that leaves out any transactions that don’t include AML/KYC data – something that will become more important as blockchain regulation continues to increase.

 

Daedalus Wallet

Daedalus is an open-source wallet created by the Cardano team. Although this wallet is coupled closely with Cardano, the team is planning to greatly expand its functionality.

Daedalus will eventually be a multi-currency wallet where you can freely exchange between the supported currencies. The wallet will begin the expansion of support with Bitcoin and Ethereum Classic.

 

Pros of Cardano

SCRIPTING:
Support two sets of scripting languages, one to move value and another to enhance overlay protocol support.

Cardano uses the scripting language Simon for easily understandable security and execution, while the other language Plutus is for general purpose smart contracts and special purpose DSL for interoperability.

SIDECHAIN SUPPORT:
The design of these side chains comes from something called proof of proof of work.

The concept allows for the secure and non-interactive movement of funds from CSL to any Cardano Computation Layer or other blockchain supporting the protocol(4).

SIGNATURES:
Cardano uses many different types of signatures.

Mainly it’s using an elliptic curve signature, as well as adding support for HD wallets.

They will be adding BLISS-B to help improve the protection and include quantum resistant signatures.

As the team develops on its roadmap (5) utilizing soft forks, they will be able to add more signature types.

USER ISSUED ASSETS (UIAS):
Ethereum has ERC20 standard tokens, such as SUB or PAY that exist on that platform.

The ADA coins will be used to solve the resources, concerns, and incentive structures which they have been making headway on.

 

Cons of Cardano

One of the biggest con about Cardano is that it is still in the development stages and it’s not necessarily considered to be better than Ethereum yet.

Another con is that it isn’t tradeable on a lot of exchanges yet, so your options might be limited if you are looking to day trade Cardano or invest in it.

 

Where can you buy Cardano?

You can purchase ADA on just a few of the major exchange platforms. Bittrex and Binance have the highest ADA trading volume of the exchanges and offer the coin as a trading pair with Bitcoin and Ethereum.

 

How to store Cardano?

In order to receive the reward from staking, you’ll most likely need to store your ADA in a wallet off of an exchange.

Right now, there’s only one wallet where you can store your ADA – the official Daedalus wallet. The wallet is currently only available on Mac and Windows (sorry Linux users), but a mobile wallet on Android and iOS is estimated to be released soon.

 

Conclusion

I do like the way that Cardano works and operate and it is one of those digital currencies that currently everybody can afford to buy into, for its price is still relatively modest and hasn’t been on the usually rollercoaster type of price rise and falls that most other digital currencies have.

Therefore I do feel that if you are thinking of investing in one or more digital currencies then the sooner you buy into Cardano the better. However, I would urge you to consider buying not only Cardano but some other digital currencies too as by doing so you are then going to be spreading the risk around.

I doubt the value of Cardano is going to shoot up to the dizzy heights of Bitcoin over the next few months or years at least, however that does I feel make it ones of the lower risk digital currencies, for it isn’t expensive to buy so any holdings you do buy are not likely to have a negative effect on your personal wealth if the value does fall, however if its price continues to rise then you may see some quite healthy returns on your initial investment.

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Wilson

Wilson is a 3x Startup Entrepreneur. He is passionate about the cryptocurrency space. You can catch him tweeting about cryptocurrency often @itswilson8

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