What Is Cardano?
Smart Contract Permissionless Decentralized Network
Cardano is an open-source, peer-to Peer decentralized network. It is based on three key components: Ada, a native currency; Cryptocurrency, which is a smart contract that manages and transfers money; and a token, which is the fuel that makes the Cardano platform run. It will facilitate direct peer-to Peer transactions with its own cryptocurrency, ADA. Its tokens, called ADA coins, are backed by real currencies obtained from the projects owned by Cardano.
The idea behind the ADA is to create a completely secure, open, permissionless, and Decentralized Internet, which will function as a global marketplace where buyers and sellers can transact and interact directly with each other in real-time, without brokers, middlemen, or third party administrators. A special feature of this smartphone application called Cryptocurrency will enable merchants and consumers to transfer money securely and interact with each other through their smart contracts. This is where the potential problems occur. Since the cryptography behind blockchains is weak and can be attacked, merchants and consumers will be more vulnerable to fraud. The problem is that most people are not trained to check if a transaction is valid or not.
To solve this problem, Cardano uses its own smart contract technology. This is different from the one used in banks and financial institutions. Using a different algorithm, Cardano can guarantee secure and complete trades without resorting to middlemen or third-party administration. With this feature, it becomes possible to transfer funds to anywhere in the world in a matter of seconds. Cardano developed its own algorithm based on the lessons learned during its extensive research and analysis of how the traditional financial systems work, and the need for a completely secure network. Cardano’s solution eliminates the need for brokers, making transactions instant and safe.
As we can see, Cardano uses its own staking algorithm to ensure secured transactions. The stakes are collected in order to pay out rewards to holders if they are successful in their transactions. These stakes, or users’ stakes, are initially deposited by Cardano when they open their store or business. As transactions are conducted, users’ stakes are deducted automatically, resulting in no out-of-pocket expenses.
Another reason why Cardano is different from other blockchains is its highly advanced, Proof-of-Stake (PoS) mechanism. Unlike other digital currencies that use proof-of-work, Cardano uses a special algorithm that determines the distribution of stake among valid participants in the network. This significantly lowers the risk posed by ICO financing. Because this reduces the need for participants to collude and manipulate the network, PoS guarantees greater security.
Proof-of-stake is one of the reasons why Cardano is able to provide robust ICO financing. Transactions are validated in the form of blocks, each having its own unique solution. This means that there is no risk posed by ICO scams. Also, the use of a proof-of-stake system ensures that the network is sustainable. It also results in a dynamic and competitive environment in the market, as well as a stable and attractive investment option.
To sum up, Cardano aims at providing the best available solution for ICO crowdsourced projects and a secure and efficient ICO investment market. As it evolves, the ecosystem will be further developed and made more efficient and robust. Cardano’s core protocol and the use of its proof-of-stake system provide a strong defense against scams and a sustainable source of income. It is time for cryptos to come to the forefront and to compete with financial transactions made possible by the Internet.
