As in the case of Ethereum, Cardano is more than a cryptocurrency, in fact, it is not a cryptocurrency, it is a platform, where the cryptocurrency used is Ada. This token can be used to send and receive digital funds.
For its creators, Cardano and Ada represent the future of money, since it allows fast and direct transfers, which are also guaranteed thanks to cryptography.
This platform is capable of executing financial applications every day, it could be used by individuals, organizations, companies and governments around the world. The construction of the Cardano platform is being in layers, in this way the system has a greater flexibility that allows it to be updated through Soft Forks.
Once Cardano completes its settlement layer, Ada will be executed and a new computing layer will be created to cover the shortcomings of the already known Smart Contracts. Cardano will also allow decentralized applications, the already known dApps.
Welcome to the third generation Blockchain
Despite dating its birth in 2015, Cardano is one of the platforms that make up the set of third generation Blockchains. To give you an idea, the first generation is Bitcoin and the second Ethereum.
Basically what Cardano intends is to build on the technology that Ethereum supports, improving the platform and Smart Contracts, making it more robust and smarter.
This definition simplifies and diminishes the Cardano team, since it is not building anything on Ethereum, the technology it uses is totally new, we can not deny either that there are some similarities between the way of working offered by the two platforms and their decentralized applications. .
The pure reality is that both are based on the Smart Contracts and the two platforms can be used to develop safe and decentralized functional dApps.
There are many people who baptized Cardano as the Ethereum Nippon since more than 95% of the investors in the early stages were Japanese.
The so-called new generation platforms are leading a nice fight to become the new Ethereum, this is not utopian, it is not even a distant future since, with almost total security, the Vitalik platform will be replaced by something more advanced and more safe. At the moment of all the companies that try, Cardano leads the group with a lot of advantage.
How does Cardano (ADA) work?
The Cardano platform uses a new algorithm for its Proof of Stake, which it has called Ouroboros. This algorithm determines how individual nodes arrive at the consensus on the Blockchain network.
This algorithm is a crucial part of the entire infrastructure that makes Ada cryptocurrency possible and is undoubtedly a great innovation in Blockchain technology. Ouroboros eliminates the need for an energy-hungry Proof of Work, thus demolishing the barrier that prevents the spectacular expansion of any Blockchain.
The level of security that has been demonstrated so far by this algorithm is compared with Bitcoin Blockchain, has never been compromised.
To understand better the operation of Cardano, we have to point out that it is developing in two layers. This separation allows Smart Contracts to be more flexible and therefore more versatile.
The companies that want to build based on the Cardano platform, will be able to take advantage of this separation to adapt their design, privacy and execution of their contracts to each specific case.