Holding the title as the world’s first peer-reviewed blockchain — Cardano and its associated coin (ADA) are designed to improve upon the scaling of both bitcoin and ethereum.
Cardano was founded through the merger of three separate entities: the Cardano Foundation, IOHK and Emurgo.
It began after ethereum co-founder Charles Hoskinson started working with the Switzerland-based Cardano Foundation, a company whose goal is to advance and standardize the Cardano Protocol.
Hoskinson then moved to establish IOHK with Jeremy Wood, an organization that develops and engineers peer-to-peer technology. The company is contracted through 2020 to design, build and maintain Cardano.
The final member of the trinity, Emurgo, aids in Cardano’s commercial ventures and partner outreach. They facilitate the creation and development of these projects.
These three institutions have been crucial in helping Cardano build a trustworthy image for itself. On the surface, the company has all the resources to be a crypto and blockchain powerhouse. In 2017, its Ouroboros platform was the first to be peer-reviewed and accepted by the cryptography community and scientifically proven to be secure.
The Ouroboros Blockchain
Unlike bitcoin, which uses a proof-of-work (PoW) algorithm, this third-generation coin runs on a more energy-efficient proof-of-stake (PoS) algorithm. The company cited energy efficiency as its primary reason for choosing this alternative consensus mechanism.
The Cardano blockchain is called Ouroboros, and its PoS algorithm is implemented in a slightly different way than others. The protocol divides the chain up into increments of physical time called epochs. (You can think of these as working shifts.) Epochs are further broken into even smaller fragments of time called slots (an individual task), wherein a single block on the chain is mined.
For each slot there is only one assigned node, called a slot leader. The slot leaders are responsible for mining the block in the slot they have been assigned. To do so, they must process and verify an incoming transaction and place that information within a block in their slot. If they fail to do so, that slot leader must wait until the network decides to re-elect them to a new slot.
This method improves scalability because it allows Cardano to increase the amount of slots per epoch and run multiple epochs in parallel. Improving the scalability issues of both bitcoin and ethereum is one the main concerns of Cardano and other third generation cryptocurrencies such as IOTA.
Cardano’s Token (ADA)
ADA is the ticker for the Cardano token — the digital currency used in Cardano transactions on the Ouroboros blockchain. The company continues to establish accessibility for ADA, targeting Japan and other East Asian countries.
The appearance of Daedalus’s exchange wallet for ADA has been a significant step forward for the company. While Daedalus plans to incorporate other digital currencies in its wallet, it currently only serves ADA.
Cardano has published its roadmap online, naming each stage after important figures in the arts and sciences. At present, the company identifies five separate stages:
After two years of research and a year of development with IOHK to build the Cardano network, the technology entered the Byron phase or “bootstrap” era.
During this period, the company hopes to further stabilize and refine the protocol with IOHK making improvements to core components. The main goal of this phase will be developing and executing Cardano SL, which will allow the decentralized network to function in a centralized world.
Efforts will be made to advance Cardano’s networking layer and elevate the performance of Ouroboros. It will introduce features such as multi-signature addresses, light clients and the less common quantum resistance signatures.
Shelley continues to ensure the technology is capable of developing Cardano into a fully decentralized and autonomous system. The company is planning to enter the Shelley stage in Q2 and Q3 of 2018 — saying that it will release updates on its efforts in this phase after launch. However, the website does state that it will first tackle stake pool testnets.
Following Shelley will be Goguen, focused on creating “a next-generation virtual machine called IELE” and a “universal language framework to be used as core infrastructure for future blockchain technologies.” These proposed technologies, which will introduce state-of-the-art programming language theory, will provide Cardano with greater security and dependability. It will reduce the blockchain systems’ vulnerability.
Bosh & Voltaire
The final two phases, Basho and Voltaire, will further focus on performance, security and scalability — offering a revision to the network and renaming it Ouroboros Praos. In the latter, Cardano will introduce the treasury model — further ensuring sustainability and self sufficiency.
Partnerships and Exchanges
Cardano has secured several interesting partnerships since its launch in 2017. The company has been primarily targeting Japan, with plans to introduce 25 ATMS in Japan by the end of 2018.
In early May, the company secured one large partnership with South Korean-based payment platform Metaps. The working relationship will involve integrating Cardano technology into the Metaps plus platform — which is currently responsible for over 10 million mobile to offline transactions. Full implementation of Cardano by Metaps (which is set to happen in 2018) would mean the use of ADA in over 33,000 offline franchise stores.
A stir was created earlier this summer when Hockinson tweeted to Tron founder, Justin Sun, that he should consider using Cardano’s Mantis Client instead of Ethereum Java. The idea seemed quite favourable among crypto-enthusiasts and even garnered a response from Sun himself saying, “Thanks for the advice! We’re looking to build the best blockchain technology so we’ll look at mantis too.”
After that, Hockinson spoke with members of Google’s London headquarters to propose a possible future partnership. This gave the tech giant the opportunity to ask specific questions about Cardano and its underlying protocol. When asked how the company plans to overtake Ethereum, Hockinson stated:
“So many Java, C++ or Go developers are writing codes on Ethereum? You can’t, Ethereum doesn’t support any of these languages. They can’t even run a single viral app on the platform. If you look at the top 10 languages, none of them works on the system, so, by definition, all those developers aren’t developing for the system, they have to go and learn new tools and new stuff. With Cardano, first off, we’re backed-compatible, 100%, we’re running an EVM.”
Hockinson then visited Africa to sign a preliminary agreement with the government of Ethiopia to create a training center for recruiting local talent. In a similar move, Cardano’s roadmap contains plans to set up a research and development center in Vietnam specializing in APIs and other tools for developers.
Cardano has also gone on to be supported by several exchanges, including Bittrex and Binance. A complete list can be found here.
Cardano has secured itself among the top 10 most popular cryptocurrencies. Holding out at number 8, its value has seen the same fluctuations as the rest of the crypto-market. On January 4th, 2018 — the value hit its all time high of 1.22USD before slow decreasing over the last eight months.
In mid-May, the company saw another spurt in value followed by the bitcoin bull run in mid-July. At present, a single Cardano token is valued at about 9 cents.
Cardano aims to reinvent the way people see and define money. Its blockchain protocol is allowing us the space to examine these preset notions around currency and to consider alternative methods for conducting transactions.
Its website has dedicated a large portion of space to discussing and extrapolating on these very ideas, offering insight into the philosophy of currency and posting deep questions about the purpose and longevity of blockchain-based projects.
Crypto writer Dylan Dedi states, “Unlike many academic treatises, the WhyCardano paper revisits the “why” and the “how” for topics such as motivation, sidechains, signatures, scalability, regulation, the Art of Iteration and interoperability, as well as the larger question of what the ultimate goals are for cryptocurrencies, particularly with regard to its native currency – ADA.”
Cardano has continued to acquire partnerships, even in moments of crypto lulls, while sustaining its place as one of the top cryptocurrencies on the market. With efforts to develop its second layer (introducing smart contracts) and its consistent efforts to improve scalability — Cardano has the means to continue on a successful and valuable blockchain project.