Cardano is a cryptocurrency that flies under the radar and could be ready to be hacked.
Cardano (ADA) was launched in 2017, and is often referred to as a third generation cryptocurrency. It builds on what Bitcoin and Ethereum have done, while aiming to be more sustainable and scalable. This means that it is more environmentally friendly, faster, and safer.
Although it has a great deal of potential, Cardano has not received much attention so far and is considered one of the must-watch altcoins. If you are considering buying it, here’s what you should know first.
1. Cardano is energy-saving.
A big advantage of Cardano is that it is an environmentally friendly cryptocurrency. For an easy comparison, here is the estimated power to use Cardano, Bitcoin, and Ethereum annually:
- Cardano: Six gigawatt hours
- Bitcoin: 130 TWh
- Ethereum: 50 TWh
Keep in mind that one terawatt equals 1,000 gigawatts. In other words, Bitcoin uses the same amount of energy as Argentina, which has about 45 million people. Cardano uses up to 600 American homes.
This is because Cardano uses a different system called Proof of Stake to verify transactions. Proof of Stake limits the number of devices verifying transactions at any one time, making reasonable power use. On the other hand, Bitcoin and Ethereum use a business model guide. Proof of work does not limit the number of devices involved, and this can result in very high energy usage. Ethereum is in the process of switching to a Proof of Stake model for this reason.
2. The founder of Cardano helped create Ethereum.
Charles Hoskinson was part of the team that founded Ethereum along with its founder and inventor Vitalik Buterin. However, Hoskinson wanted it to be a business, while Buterin wanted a non-profit organization. Because of this controversy, Buterin removed Hoskinson from the Ethereum team in 2014.
Hoskinson started developing Cardano in 2015, and it has many similarities with Ethereum. Both Cardano and Ethereum are programmable blockchains that other people can use to develop applications, and both use smart contracts.
3. It can handle a large number of transactions.
Scalability has been an issue for the largest cryptocurrencies. Bitcoin processes about five transactions per second, and Ethereum processes about 15. This results in slower transactions with higher fees. On the other hand, Visa processes about 1,700 transactions per second.
In tests, Cardano processed 257 transactions per second. It also plans to add another layer, called Hydra, to its blockchain. With this technology, it can process a million transactions per second.
4. Cardano has a wide range of uses.
Cardano is an ambitious project, and there are many potential uses for his technology across a variety of industries.
For a current real-world example, we have Cardano’s partnership with the Ethiopian Ministry of Education. Cardano’s blockchain will store tamper-proof records of five million Ethiopian students. When these students pursue higher education and jobs, they will have their records and achievements available on the blockchain.
Here are other use cases for Cardano in different sectors:
- Health Care: Cardano’s blockchain can certify pharmaceutical products to avoid the risk of buying counterfeit medicines.
- finance: Cardano can be used in developing countries as a record of people’s identities and to prove their creditworthiness.
- Farming: Blockchain technology can provide reliable supply chain tracking for farmers, transport workers, and merchants.
5. The research approach takes first.
One of the special things about Cardano is that its development process is subject to peer review. Architects and academic experts specializing in blockchain technology and cryptography play an integral role in building Cardano.
The peer-review process means that Cardano is a type of cryptocurrency with slow and steady developments, rather than one with rapid changes. The advantage of Cardano’s approach is that peer review detects security issues that might otherwise lead to more serious problems later.
6. A limited number of Cardano is available.
Cryptocurrencies can have a fixed or unlimited supply. Bitcoin is the most famous example of a fixed supply cryptocurrency, as there will never be more than 21 million bitcoins.
Cardano the same way. The maximum supply is 45 billion ADA, and there are currently about 32 billion ADA in circulation. This alone does not guarantee that the price will rise. But if Cardano’s popularity spreads, a limited supply could help increase demand.
7. You will need a cryptocurrency exchange that offers Cardano.
Since Cardano is one of the biggest cryptocurrencies, you can find it on many of the best cryptocurrency exchange platforms. Here are some of the popular platforms that have been listed:
It’s not available everywhere, though. One notable site that you don’t own yet is the Gemini exchange site. You also can’t get it when you buy crypto through PayPal or Venmo.
Like every cryptocurrency, Cardano has its risks. We cannot be sure that it will succeed in achieving its goals or even that it will be of value in the future. These are the risks you are exposed to with any investment in cryptocurrency. Still, it’s easy to see why investors in Cardano are so excited. Now that you know more about it, you can decide if buying Cardano is right for you.
Related: See The Ascent’s list of the best places to buy Cardano.
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