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Definition of Cardano: what is it and how does it work?

What is Cardano and how does it work? Dwain Ross ★★★★

Cardano, founded in 2015 and published in 2017, is a fully decentralized, third-generation, open-source blockchain platform. It is designed to deploy proprietary smart contracts and decentralized applications (DApps). Cardano is a research platform developed by a team of scientists, researchers and engineers who are experts in cryptography.

The ADA token, the platform's native cryptocurrency, was launched in an ICO (Initial Coin Offering) that generated over $62 million dollars and a total of 31 billion tokens were distributed.

Cardano is a blockchain consisting of three partners that play key roles in its ecosystem:

The Cardano platform is built on two tiers:

As mentioned at the beginning of this article, Cardano is a third-generation (3.0) blockchain. It was created to address the scalability, interoperability and resilience issues faced by other blockchains such as Bitcoin (BTC) and Ethereum (ETH). The Cardano blockchain is based on two fundamental principles:


Unlike Bitcoin, which uses a "proof-of-work" system, Cardano is based on a technology called "Ouroboros". Ouroboros is an algorithm that increases the number of transactions per second and checks a block every 20 seconds, with that time gradually decreasing over time.

"Ouroboros ensures the continuity of each moment: gradually building an unbroken chain. Thanks to Ouroboros, every transaction, agreement and information exchange becomes part of an unchanging past."

Social aspect

Cardano's founders and engineers need money to continue developing their platform. To do this, the developers created a smart contract that is used like a decentralized bank account. It will allow the platform to charge a small fee on each transaction and rewards for mining. The money collected by the smart contract will be used to fund Cardano's ambitious projects.

The community plays a very important role in the development of the platform and the decision making of the founders.

RINA system

Cardano wants to improve the peer-to-peer system used in Bitcoin (BTC). The problem with Bitcoin is that the greater the demand for transactions, the greater the bandwidth consumed by the peer-to-peer network.

This is where the RINA (Recursive InterNetwork Architecture) solution comes to the rescue. RINA is a system designed to save bandwidth by creating "subnets" that group nodes together. This method utilizes less bandwidth and increases the flexibility of the Cardano network.

To summarize, Cardano has been marked by a number of updates and improvements aimed at making the blockchain more efficient, more secure, and more adaptable to the needs of the community. The platform has also pioneered the move to decentralized governance, giving users increased control over decisions made on the blockchain.

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