Cardano is one of the preferred cryptocurrencies with long-lasting staying power. Its ADA coin sits comfortably in the top ten cryptocurrencies ranked by market capitalisation. It’s actually been in this top ten ranking since its launch in 2015. Today it’s in sixth place after Bitcoin, Ethereum, Binance Coin, XRP and Tether. But the landscape is volatile, and only a few weeks ago it was in third place. So things change rapidly.
What is Cardano?
Cardano certainly has several good things going for it. Its technology is superior to many of its peers, and it has strong community backing.
ADA is the digital currency associated with the Cardano platform. It’s named after Ada Lovelace, the world’s first computer programmer.
IOHK (Input Output Hong Kong) is the research lab behind Cardano. Its focus is on decentralization and the challenges it poses to existing global financial systems. The Cardano development team are academics and scientists, and they work closely with academia to have everything peer-reviewed and transparently shared. The Cardano Foundation and EMURGO, along with IOHK govern Cardano.
Is ADA a coin or a token?
ADA coin is the name of the cryptocurrency that’s used on the Cardano platform. But ADA tokens can be used to vote or for staking in the Cardano ecosystem.
Within digital currency wallets, such as Exodus or Daedalus, you can easily stake Cardano ADA for rewards. Once you stake your ADA coin, it becomes an ADA token, which is then used to mine for ADA. If you find some, you’re rewarded with a stake.
Staking is a popular practice among altcoin owners. It is the proof-of-stake (PoS) part of the blockchain network that Cardano is striving for. And this is being developed into a decentralised application (DApp) development platform, complete with multi-asset ledger and verifiable smart contracts.
Last month Graph Blockchain Inc. (CSE: GBLC) invested $300,000 into Cardano for the purpose of staking the ADA coin.
Meanwhile, over half a billion US dollars worth of ADA is currently being delegated to charity-focused initiatives on Cardano through mission-driven stake pools.
Why Cardano could replace Ethereum
Cardano is a smart contract platform, as is Ethereum and Polkadot. Many die-hard Cardano fans believe it will eventually displace Ethereum thanks to its high-speed tech and fee free transaction setup.
Ethereum’s value has soared this past year as more high-profile clients jump aboard. Ethereum is also the backbone of the non-fungible token (NFT) marketplace, which has been subject to NFT mania this year, further boosting the Ethereum price.
And Ethereum is also profiting from notable decentralized finance (DeFi) projects which are built on its blockchain. However, Ethereum is expensive to use, and its transaction times suffer from lag. Cardano intends to beat it on both these counts, due to its lightweight design.
Cardano recently undertook a major update called ‘Mary’ which took it a step closer to emulating Ethereum. The Mary upgrade is a hard fork, transitioning the Cardano ledger. This changes its capabilities from simply holding ADA on its blockchain to allowing multiple tokens to be created and exchanged.
Read More:Can Cardano displace Ethereum?