Slower and steady wins the race
Any cryptocurrency that can grow by almost 100% in a year is worth keeping an eye on.
And Cardano most certainly is that.
While the blockchain is similar to Ethereum in that it follows a decentralised Proof of Stake (PoS) model, it is differentiated by its status as a peer-reviewed blockchain.
The vetting process for every protocol change takes the form of an academic-like discussion.
This is unique in a market where blockchain speed is considered a mark of excellence.
The thinking behind it is that moving too fast can allow costly mistakes to creep in.
The name of Cardano’s native token has also caught people’s attention.
ADA stands for “Augusta Ada King”, Countess of Lovelace.
This 19th English aristocrat is considered the world’s first computer programmer by virtue of her designing a program for Charles Babbage’s digital computer prototype.
Rise of the node leaders
While the similarities between Cardano and Ethereum can be explained by it being created by the latter’s co-founder Charles Hoskinson, it runs on its own PoS blockchain called Ouroboros.
Transaction processing is organised into epochs, which are then further broken down into time slots.
Through a selection process a node leader is then chosen to validate and add blocks to the chain.
Security of the network is also enhanced since decentralised selection of node leaders removes the risk of any single point failing.
Another major point is that Ouroboros uses far less energy than other blockchain networks.
This instantly makes it a winner on the scalability front.
Healthy long-term prospects
The Cardano price USD rate is always keenly studied.
Something that intrigues investors is that because delegations without bonding periods are accepted by stake pools, literally anyone with access to a mobile wallet can earn ADA.
Again, this differentiates it from Ethereum, where someone may only become a validator if they have invested a minimum of 32 ETH.
A further aspect in Cardano’s favour is that Cardano-based tokens and non-fungible tokens are built on the same blockchain network.
Those built via smart contracts, automation programs for blockchain transactions, face the risk of programs that cannot be changed once set in motion.
It almost goes without saying that the blockchain’s peer-review research approach also inspires investor confidence.
So too does the fact that ADA are now held in the U.S. government’s strategic crypto reserve.
Perhaps the token’s biggest selling point is that it is on course to reach zero-percent inflation by 2050.
Furthermore, there is an upward trend of more developers building decentralised applications (dApps) on the Cardano platform.
This suggests that more users will follow.
Should these applications be targeted at sectors like supply chain management or identity verification – increasingly important in today’s digital business environment – the sky could well be the limit for Cardano.
That it has embraced AI by integrating Coinbase’s x402 payment system to make onchain payments using ADA and its USDM stablecoin is further cause for optimism.