Cardano

The third-generation blockchain-based system operated by the ADA coin is Cardano. The crypto-currency that runs on the Cardano platform is the ADA coin. Indeed, Cardano is the most interesting and popular type of crypto-currency projects currently on the market. Lots of crypto-currencies arose after the invention of Bitcoin. Cardano, among them, promises unique characteristics and has become very popular. It has borrowed elements including Bitcoin and Ethereum from cryptocurrencies implemented before it. Like Ethereum, it uses intelligent contracts to operate in a decentralized way.

The digital gold

First generation

Cryptocurrencies were invented when people started to wonder if it was possible to establish decentralized money transfer and exchange without the intervention of third parties. This led to Bitcoin being deployed by an anonymous person under the pseudonym of Satoshi Nakamoto. It uses blocks containing information pertaining to the network. They are like ledger books, permanently registered by the trans. The block set is known as block-chains.

This brilliant innovation, which was one of the cryptocurrencies of the first century, permitted free transactions between individuals without any external control. It only permitted monetary transactions, however, and it was not possible to set conditions for those transactions.

Second generation

The second generation of cryptocurrencies opened up this route. A new programming language was implemented in this kind of cryptocurrencies, which led to the development of smart contracts. The smart contract includes the exchange in a straightforward conflict-free way of everything of value including assets, property, and shares by avoiding a middle man's services.

The Ethereum of Vitalik Buterin was the most famous system which demonstrated that with its smart contract technology, blockchains that are simple payment systems can revolutionize financial systems. For Ethereum, a collectible token known as 'Crypto-kitties' produced a surge. Crypto-kitties caught fire at more than two million dollars a day during the bull market of 2017. However, when the 12 percent of transactions of Kitty tokens in the entire Ethereum network itself brought the network itself to a screeching halt, Etherium faced scalability problems. The absence of a well-thought-out system of governance provided space for change and an incentive for crypto-currency systems of the third century.

Cardano is different

The third generation merged all the positive elements of the blockchains of the first two generations, leading to the development of Cardano. In September 2017, Cardano was deployed for two years of production. Charles Hoskinson, who was one of the Ethereum co-founders, is its creator. Cardano is a peer-reviewed paper, unlike other cryptocurrencies. It ensures that experts from all over the world read and improve their reviews of articles.

Cardano plans to fix the new generations' issues, which are:—

• Scalability

• Interoperability

• Sustainablity

Scalability

Because it is a globally based transaction system, it must manage as many transactions per second as possible. Since bitcoin uses a working proof algorithm where the power to mine new blocks is granted to all users. But this leads to time and processing resources being lost. It is also not economical since it allows energy to be lost. With its Ouroboros operating system, Cardano solves these problems with the Proof of Stake algorithm, where the network elects a few nodes to mine the blocks called slot leaders by these elected members. For this, Cardano's work breaks time into Epochs.

Each Epoch, a short period of time in which the blocks are mined, is divided into slots. For that particular slot, only the Slot Leader can mine a block. The leader of the slot listens to and verifies the transactions of the specific slot. If he does not check in time, he will be disqualified from the role and a new slot leader will be chosen. This Cardano technique solves the issue of scalability as an increase in epochs often leads to an increase in slots where parallel scaling of multiple epochs is feasible.

In the P2P network, the blockchains are processed. A copy of each and every transaction is obtained by a node. This poses problems with scalability as there are lots of transactions leading to a lot of bandwidth. To break the network into subnetworks, Cardano uses Recursive Internetwork Architecture (RINA) and can communicate with other subnetworks.

The Cardano team is also looking forward to solving problems with data storage by pruning, compression, and partitioning methods.

Interoperability

Although Cardano is available today with its own protocol and rules, there are thousands of competitive cryptocurrencies. The Cardano project aims to become the blockchain internet where assets can be transferred between blockchains seamlessly.

Since there is no knowledge from whom, to whom or for what cause, it also solves the problems of unreliability by the government. Cardano enables individuals to connect to the transaction meta-data. While this attachment is voluntary, this new function goes hand in hand with the expectations of the conventional banking system.

Sustainability

Cardano enables businesses via Initial Coin Offerings to grow around cryptocurrencies (ICO). It aims to create a treasury where a small percentage of all network transactions are collected and this amount is used to improve the Cardano protocol where users provide the group with the information and money required for implementation with suggestions. The most famous proposal is taken and money from the treasury will be spent as resources for the proposal's fulfillment. The key benefit of this process is that nobody manages the treasury and the ideas are selected by voting.