Cardano’s Native Token

With extensive experience as an electrical/software/coding engineer along with having a diverse financial background, Thomas Wettermann’s areas of interest include Machine Learning (ML), artificial intelligence (AI), and Financial Technology (FinTech). For the past few years, Thomas Wettermann has focused on the underlying technologies that support and promote all phases of cryptocurrency, Web 3.0, and metaverse ecosystems.

Cardano (ADA) is a third-generation blockchain that builds upon Ethereum - a second-generation blockchain.

Cardano Logo (source: crowdwisdom.live)

As a third-generation blockchain, Cardano enhances those things that the second generation blockchain Ethereum excelled at: scalability, efficiency, and security.

What Is Cardano’s Ecosystem?

The Cardano blockchain is an open source blockchain which means that its records are made public and are readily available. Cardano is also a decentralized blockchain network that, like Ethereum, supports self-executing computer programs by way of smart contracts.

The code and the agreements contained within the Cardano ecosystem reside in a distributed, decentralized blockchain network. With these smart contracts, the code controls the execution, and transactions are trackable and irreversible.

As such, Cardano was created to enable developers to build and publish smart contracts and distributed applications (dApps).

Smart Contract (Source: theengineeringprojects.com)

All smart contracts residing on the Cardano blockchain have certain similar traits.

For example, because smart contracts are coded into the blockchain, they have a status. This status or “state” is shared amongst every single blockchain node across the entire network. So, each node running this blockchain has a copy of the present status of every single smart contract residing on the blockchain.

Importantly, these smart contracts are also immutable. That is, they cannot be altered. Although there are ways to extend them or replace parts, there is no way to secretively manipulate the content of a smart contract without drawing the attention of the network.

In addition, the logic of a smart contract cannot be distorted. With a smart contract, there is no room for interpretation of the terms of the agreement. That is why these coded agreements are referred to as “contracts.” They act like an agreement between parties, but one which needs no third party to initiate, interpret, or oversee the results of the contract.

Cardano is structured so as to enhance these smart contracts making them easier to scale. With such a network, almost anyone – not just developers – can create their own decentralized applications.

What is the Native Token of the Cardano Ecosystem?

The Cardano ecosystem supports peer-to-peer transactions using its cryptocurrency ADA. This token is named after Ada Lovelace, a 19th-century mathematician and who is recognized as the first computer programmer.

Cardano currently has a circulating supply of 33.5M ADA coins. The maximum supply of the ADA is limited to 45 billion tokens which are to be released over time through minting. This limit is put in place by the Cardano blockchain's code and represents the absolute maximum ADA that can be minted.

Much like the Bitcoin coin supply hard cap, ADA’s hard cap acts like a deflationary attribute to this token. ADA can be exchanged for fiat currencies such as the United States dollar and stored securely in hot and cold wallets.

ADA runs on Ouroboros which is a proof-of-stake-styled consensus protocol.

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