The Summary 

Unliike most other cryptocurrencies, ADA did not release a Whitepaper during the launch. Cardano - a foundation based in Switzerland, released ADA with a typical approach of launching an ICO without a Whitepaper. Cardano is a decentralized third-generation proof-of-stake(PoS) blockchain platform and home to the ADA cryptocurrency. PoS is a consensus mechanism for processing transactions by staking tokens. Cardano is a fully open-source blockchain project. An open-source project means anybody is free to use, study, modify and distribute the project for any purpose.

The Problem 

Cardano was developed to address the challenges in the then existing process of designing and developing cryptocurrencies. ADA has been termed the ‘first third-generation’ cryptocurrency. Bitcoin is the first generation cryptocurrency that offered decentralised ledgers for secure cryptocurrency transfer. The major disadvantage of Bitcoin is its high consumption of energy to verify transactions, Bitcoin requires computers to solve ever more complex math problems. Ethereum is considered the second generation cryptocurrency that provided more enhanced solutions for writing and executing smart contracts, application development, and the creation of different token types. But, none of the existing blockchains supports connectivity to other networks. Cardano combines the properties of the prior generations to ensure the highest scalability, interoperability and sustainability. Existing cryptocurrencies are considered to lack these factors.

The Solution

Cardano was launched with the vision of addressing the three strategic challenges faced by all blockchain networks - Scalability, Interoperability and Sustainability.

1. Scalability - refers to the ability of a blockchain to process a higher number of transactions without affecting the network performance. Ouroboros - Cardano’s PoS protocol, is presented as a possible solution to the scaling problems. Ouroboros algorithm enables faster transactions by appointing the leader node to approve the transaction instead of having a copy of the blockchain in each node in the network.
2. Interoperability - refers to the ability of a cryptocurrency to connect with other networks. Cardano aims to enable cross-chain transfers through side chains, which conduct transactions between two parties off-chain to ensure a multi-functional environment for financial, business, or commercial operations.
3. Sustainability - refers to the self-sustaining economic model in the blockchain network. Every participant in Cardano’s blockchain will be rewarded and incentivised by the network itself. To ensure sustainability, the treasury system is controlled by the community and is refilled constantly from potential sources such as newly-minted coins being held back as funding, a percentage of stake pool rewards, and transaction fees.

The Team 

Cardano was founded in 2015 by Charles Hoskinson. He was one of the co-founders of Ethereum. He left Ethereum and co-founded IOHK, a blockchain-based company in 2014. Jeremy Wood is another co-founder of IOHK. Input Output Hong Kong is a research and development company in the fields of cryptography and distributed systems.

Charles Hoskinson

A Colorado-based technology entrepreneur, mathematician and cryptocurrency evangelist. His professional experience includes founding three cryptocurrency-related start-ups – Invictus Innovations, Ethereum and IOHK. He was the founding chairman of the Bitcoin Foundation's education committee and established the not for profit Cryptocurrency Research Group in September of 2013. He leads the research, design, and development of Cardano.

Jeremy Wood

He is the co-founder and chief strategy officer at Input Output Hong Kong. In 2013, he founded Kansai Bitcoin Meet-up in Japan to educate and build a community of crypto enthusiasts. Later, he joined as the executive assistant at Ethereum. After leaving Ethereum, Jeremy consulted on cryptocurrencies before starting Input Output with Charles Hoskinson in 2015. Jeremy stepped down from his role as chief strategy officer in 2020.

The Roadmap

Cardano was launched in 2016 with a defined structure of development phases of its blockchain network in five eras -  Byron, Shelley, Goguen, Basho, and Voltaire. Each era is a summary of Cardano's development. Each era is centred around a set of functionalities that will be delivered across multiple code releases.

1. Bryon - Development of Cardano foundation and building the community
2. Shelley - Decentralisation of Cardano’s blockchain
3. Goguen - Focussed on building Smart Contracts and Dapps
4. Basho - Optimising the scalability and interoperability of the network
5. Voltaire - Voting, Staking and treasury system to be introduced as part of governance

The Tokenomics

ADA’s Initial coin offering consisted of five rounds of public sales held between September 2015 to January 2017. Cardano raised around $25.9 billion through crowd sale

Funding Rounds

Nov 2015 - $2.66M

April 2016 - $16.49M

Sep 2016 - $ 14.32M

Sep 2016 - $19.36

Feb 2017 - $ 26.36M

Max Supply of ADA tokens that will ever be minted is 45 billion. The current circulation supply as of April 2022 is 33.74 billion. Similar to Bitcoin, the rate at which new ADA is minted decreases over time such that the circulating supply (currently ₳33.2 billion) asymptotically approaches the maximum supply.

In Conclusion

Cardano has a long-term vision for its blockchain and cryptocurrency-ADA. The development and scope of Cardano’s blockchain can be expanded to multiple uses cases from smart contracts to building decentralised applications. As Cardano is focused on improving the scaling and performance of the network, as well as rolling out supporting infrastructure for developers.