What is ADA? 7th largest coin

1. Overview

  • In 2021 alone, the August Cardano (ADA) price has increased more than 23 times year-over-year. Maintaining a good growth momentum, ADA is still attracting a lot of interest from investors and is expected to continue to grow in the second half of 2021.
  • The Cardano project was started in 2015 by the Investment Company in Hong Kong (IOHK). Charles Hoskinson, co-founder of both Ethereum and BitShares is the CEO of IOHK..
  • Cardano’s idea is to build a blockchain that overcomes the disadvantages of old blockchains like Bitcoin, Ethereum and others. The goal is towards making transactions – cheaper, faster and more in quantity.
  • Cardano is a fully open-source platform that allows multiple developers to build dApps (decentralized applications) and create DeFi (decentralized financial economy).
  • The remaining ADA is Cardano’s currency format, built on top of the Cardano platform with the goal of implementing transactional transactions to Cardano.

2. Who is the Cardano development team?

There are three organizations that are involved in the development of Cardano:

  • The Cardano Foundation – based in Switzerland, is an independent agency designed to assist Cardano users with all legal and commercial matters.
  • IOHK – a leader in cryptocurrency research and development, this team is responsible for the development of the platform until 2020.
  • Emurgo – This agency invests in emerging startups and helps build commercial solutions based on the Blockano blockchain.

3. How does Cardano work?

Cardano cryptocurrency follows a proof of stake algorithm. It is formed by 2 separate layers:

CSL class:

The first membrane in the Cardano cryptocurrency. It has almost the same structure as Bitcoin. The only difference is that it uses a proof-of-stake algorithm while Bitcoin uses a proof-of-work. They were created by the University of Edinburgh (Greece) in conjunction with IOHK – A company specializing in building development networks.

CLL class:

The CLL layer approves a number of applications as well as smart contracts autonomously. It has nothing to do with the CSL class. The interesting point of the above software and applications is that it has the ability to quickly improvise. From there, highly adapt to the requirements of the supplier and more deeply to the customer.

In general, blockchains have only one layer. This dual layer is what distinguishes Cardano from other cryptocurrencies.

4. Cardano’s Algorithm

Cardano’s algorithm is Ouroboros – Proof of Stake. Blockblock blockano uses a consensus mechanism that runs on Proof-of-Stake. Here’s how it works:

  • People who validate transactions are called “validators” and are not miners.
  • Validators freeze part of their ADA coins. This is called staking.
  • When validators verify the transaction, they will receive additional bonuses as a reward.
  • The higher the stake, the greater the chance to receive the winning reward
  • The amount in the bonus is proportional to the value of the stake.
  • The Ouroboros is more efficient and PoW friendly (algorithm used by BTC). It requires less electricity to operate and transaction fees are also kept low. The Ouroboros protocol ensures that everyone on the network has a chance to earn rewards.

5. Potential and opportunities in Ada Coin

Cardano is positioned as a financial system. Because of that, it holds a very good position in the financial services sector.

Ada Coin is still under development and not much developed in dApp form. This makes future use-case analysis much more difficult. However, both the payment transaction and remittance space are clearly Ada Coin’s potential avenues.

Ada Coin is still rated as lagging in adoption and market penetration. Dash has almost spent a lot of effort being able to build infrastructure components for the end users. Meanwhile in developing markets it is very difficult to get a foothold and Ada Coin is also struggling because of this.

Much of Ada Coin’s success depends heavily on its ability to establish a dApp ecosystem. Theoretically, today the network still has some outstanding features. Ada Coin has several major projects racing to attract users’ attention.

6. Ada Coin’s Rivals

6.1 In blockchain technology

The level of acceptance of this network seems to be low. However, it can be seen that Ada Coin has provided better values. The electronics market seems to be strengthening now. The undervalued Ada Coin doesn’t diminish its chances for technological prowess either.

Ada Coin has a lot of competition with blockchain startups and big players in the traditional sector.

6.2 In traditional finance

Currently, Ada Coin is still competing with companies with much larger financial resources. Some of these financial firms are less concerned with the open source nature and are patenting. Therefore, Ada Coin is accelerating the rate of development and adoption so that it can quickly take advantage of the market opportunity while it is still bright.

Ada Coin can catch up with other blockchains. And it is imperative for Ada Coin to gain market penetration before the opening opportunities are closed.

7. Disadvantages of Ada Coin

7.1 Ada Coin is still in development

Ada Coin currently still needs a lot of time to be ready to go into popularity. The release of the SL mainnet and the ADA token has gone further than some 3rd generation blockchains. However, as of yet, a release date has not been set for the Cl smart contract platform and the virtual machine, no. Are there any dApps being developed?

Meanwhile Ethereum already supports more than 800 dApps. Having e-card in 1 year, Ethereum will make significant progress compared to scaling solutions and there will be no place for Ada Coin. However, we cannot be sure of this and all scenarios are still possible.

7.2 About the management system and budget

Ada Coin is relying on a rather complex governance system. System features must be implemented carefully to be able to arrange incentives as well as to ensure that bad actors cannot perform system manipulations and destroy it.

What if a group of users are actively using the funds for their own benefit. This is really a factor that you need to consider.

Should invest Ada Coin?

Although Ada Coin has a great advantage, it is really difficult to evaluate the effectiveness and valuation of Ada Coin along with other blockchain platforms. No matter how advanced the technology is, without a strong and widely used community, it is difficult for any platform to get far.

Ada Coin still needs a lot of time to complete the platform.

Ada Coin is very difficult to replace NEO because the segments and goals of the two are inherently different. It is more difficult than Ethereum. Ethereum can completely overcome its weaknesses and can take the full market share of dApps and expand networks.

Conclude

It can be said that Ada Coin is a blockchain platform with smart contracts and many decentralized applications similar to Ethereum and with more improvements. Consider holding ADA as part of an asset portfolio

>>>On the same topic, please see more articles: 

Leave a Comment

Your email address will not be published. Required fields are marked *