What is Cardano? A Simple Explanation

What is Cardano? A Simple Explanation

There’s a cryptocurrency on the market, and it’s growing at a rate at which developers can barely keep up. It’s called Cardano, and it’s based on a blockchain platform which makes it extremely secure. It is also a scalable platform for running a smart contract.

Cardano was created in 2015 and eventually released in 2015, but it wasn’t until January of 2021 that developers released a stable and functional version. Since then, Cardano has continued to grow. Their mission statement is to provide society with a self-governing, fair, and accountable cryptocurrency exchange.

What's Ahead...

What is Cardano?

Cardano is a proof-of-work cryptocurrency with a large market cap. Proof-of-work cryptocurrency works by verifying the transaction between the two parties involved rather than including a third-party service, like a bank or credit card company, to verify the transaction. 

Originally funded through an initial coin offering, Cardano had a market cap of approximately $600 million. An initial coin offering is a type of crowdfunding where a business relies on the public to fund its project. The market cap began at $600 million, and today it sits in the billions. Market cap is essentially how much cryptocurrency the company has to offer. 

The other feature that makes Cardano so successful is blockchain technology. Cardano is a cryptocurrency that works on blockchain technology. Blockchain technology is arguably the most secure transaction platform because it eliminates the need for a third-party financial institute.

 This is what allows the two parties to rely on proof-of-work and eliminate the third party. Adding a third party to any transaction can increase the risk that information from one or both of the parties involved will become breached. 

Where to Buy Cardano?

Cardano tokens are called ADA, which is also the company’s stock symbol. You can buy Cardano on any of the following global exchange platforms:

Once you have purchased your ADA, you can store them in a wallet by transferring them from the exchange to your wallet. You can leave your ADA in the exchange if you prefer, but we recommend transferring them to a wallet so that you have the most control over your ADA. 

There are two types of wallets you can choose from: a software wallet or a hardware wallet. 

A software wallet is recommended if you are purchasing a small amount of Cardano. Software wallets are free to use and can run on your computer or mobile phone.

A hardware wallet is recommended if you will be purchasing large amounts of Cardano. Hardware wallets are also free and should be installed on a secure computer that is not shared. 

Once you have chosen your wallet, you will need to send your ADA cryptocurrency to your wallet. You will do this by using your ADA address. Your ADA address is a long string of letters and numbers that are configured just for you. Your ADA address will always start with a capital D.

How Does Cardano Work?

Cardano uses proof of work and proof of stake to work successfully. Without these two components, Cardano wouldn’t be nearly as successful as it is today.

As we mentioned earlier, proof-of-work is a security measure in place that validates and secures each transaction without using a third-party financial institution. 

Proof of stake is like an upgrade to proof-of-work. It is another way for transactions to remain secure. 

For proof of stake to be successful, it requires validators. Validators are regular invested participants like you or me who use their ADA to ensure that transactions between two parties remain secure and valid. 

To become a validator, the network reviews the number of ADA coins you have in your account along with the length of time you have had them. 

Once a transaction has been made, validators can contest the transaction if they feel it is invalid. If enough validators contest the transaction, the network will update the blockchain accordingly. 

The Cardano blockchain is an important part of its success. The blockchain is what keeps transactions secured, so it must remain as accurate as possible. Without the blockchain, proof-of-work would be ineffective. This would require using a third party for transactions which is the reason that Cardo is so successful.

Cardano uses two types of blockchains: Cardano Settlement Layer (CSL) and Cardano Computing Layer (CCL). Cardano uses two blockchains so that transactions go quickly and smoothly. The system knows which transactions need to be categorized into which respective layer. 

Account management, balancing, and validations are all handled on the Cardano Settlement Layer, while the Cardano Computing Layer is used to perform exchanges made on the blockchain through apps and other software. 

Cardano Partners

Cardano has partnered with EMURGO and IOHK to create a network that is trusted and secure. EMURGO is known worldwide and works with many major retailers, as well as healthcare and the public sector. EMURGO now offers classes to colleges and universities, which is evidence of just how much Cardano and cryptocurrency is growing.

IOHK has partnered with Cardano to create the blockchain platform on which Cardano occupies. IOHK is also known worldwide and specializes in peer-to-peer sharing. IOHK focuses primarily on blockchain development and is dedicated to finding new ways to optimize the service. 

We mention these partners because we feel they play a key role in the success of Cardano. Cardano has become a successful cryptocurrency, and it will continue to grow and remain successful as long as they maintain unrivaled partnerships. 

Wrapping Up on Cardano...the Sleeper

Cardano is a rapidly growing cryptocurrency that is trusted, secure, and functional. It ensures its users that their transactions remain safe each time. The Cardano platform does this by putting blockchains and proof of stake in place to guarantee that a third party will not be needed during the transaction. 

To buy Cardano, you will need to purchase ADA on a global exchange. You can either keep your ADA in the exchange or transfer it to a wallet using your ADA address. 

Cardano makes it easy to buy and transfer ADA and, according to recent trends, Cardano should only continue to grow. 

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What is so Good About Cardano?

Paul Martinez

Paul Martinez is the founder of BendingDestiny.com. He is an expert in the areas of finance, real estate, and eCommerce.  Join him on BendingDestiny.com to learn how to improve your financial life and excel in these areas. Before starting this blog, Paul built from scratch and managed two multi-million dollar companies. One in the real estate sector and one in the eCommerce sector.