What is Cardano?

What is Cardano?

BINGX

Crypto1earn

12/20/20222 min read

Cardano is a decentralized public blockchain and cryptocurrency project that is focused on providing a secure and scalable platform for the development and execution of smart contracts and decentralized applications (DApps). It was created by blockchain development firm Input Output Hong Kong (IOHK) and is led by Charles Hoskinson, co-founder of Ethereum.

Cardano is built on a proof-of-stake consensus algorithm, which means that instead of mining new blocks through the use of powerful computer hardware, network participants validate transactions and create new blocks by staking their own cryptocurrency holdings. This is intended to be a more energy-efficient and decentralized approach to securing the network.

Cardano is also designed to be highly modular, with a layered architecture that separates the core blockchain logic from the application layer. This allows for the easy addition of new features and upgrades without disrupting the overall network.

The Cardano blockchain includes a native cryptocurrency called ADA, which can be used to facilitate transactions on the network and as a store of value. Cardano also has a strong focus on research and development, with a team of academic and industry experts working on the project.

How does Cardano work?

Cardano has a multilayered architecture that separates the settlement layer (which handles transactions) from the computation layer (which handles smart contracts and dApps). This allows for more flexibility and scalability, as the settlement layer can handle a large number of transactions without being slowed down by the more computationally intensive tasks of the computation layer.

In the Cardano network, transactions are validated and added to the blockchain through a process called "slot leaders." Slot leaders are chosen through a randomized selection process, based on the amount of ADA (Cardano's native cryptocurrency) that they have staked (i.e., the amount they have committed to the network as collateral). Slot leaders are responsible for adding new blocks of transactions to the blockchain, and they receive a reward in ADA for their work.

Cardano also has a system of governance, called the Cardano Improvement Protocol (CIP), that allows stakeholders to propose and vote on changes to the network. This allows the Cardano community to collectively decide on the direction and development of the platform, ensuring that it meets the needs and expectations of its users.

Cardano's smart contract platform, called Plutus, is based on the functional programming language Haskell. It allows developers to build and deploy smart contracts and dApps on the Cardano blockchain, enabling them to create decentralized applications that can be executed in a secure and scalable manner.