Cardano Explained
By NOWNodes on The Capital
Originally published in the NOWNodes blog.
The founder of Cardano, Charles Hoskinson believes that Ethereum has been quite successful when it comes to smart contracts. However, Hoskinson considers Ethereum as a second-gen blockchain. Hence, he thinks that Ethereum must evolve into a better version of itself. When it comes to Cardano, Hoskinson says that the Cardano team has put in an extreme amount of care in its development. All of which goes into the upkeep of Cardano.
As of now, three organizations are dedicated to the development and care of Cardano. They are IOHK, Emurgo, and The Cardano Foundation.
Cardano — A Third-Gen Blockchain Project?
Hoskinson considers Cardano as the third-gen blockchain project. He says that he has combined the good qualities of the first and second-generation blockchain. Later on, he added a few elements of his own. Hence, Cardano came into existence. Cardano aims to solve the issues related to sustainability, scalability, and interoperability.
Cardano is a well-balanced token that has a combination of both scientific research and philosophy. The Cardano team makes sure that they engineer the Cardano platform to only include the “High Assurance Code.” Hence, the Cardano development team puts in more hours to only input the quality development code. Hoskinson oversees that the only high-quality code is used in the Cardano platform to prevent any ETH-ETC-split-like event in the future.
Science Behind Cardano
Both IOHK and Charles Hoskinson have put in a system to ensure due diligence from the Cardano development team. They expect a very high quality of work from Cardano’s blockchain developers. The Cardano founding team has created a system that keeps Cardano’s code secure and safe. They do it through a combination of science-based principles, formal verification, and peer reviews.
The core programming language of Cardano is Haskell. It has enabled the Cardano team to formally verify the code of Cardano. The Cardano development team uses mathematical uncertainty to check the capabilities and incapabilities of the functions.
The Cardano development team also adopts the first principle of thinking in its development process. It means that they begin the development work from the fundamental level. At the fundamental level, the development team has a clear-cut idea of what is true and what is not. Hence, the Cardano team starts building from the fundamental level. The Cardano team also gets their code reviewed by experts from their domain. This part of the process is known as peer review.
Cardano — How Does it Work?
There are two core layers of Cardano. These are the settlement layer and a computing layer. The cryptocurrency transactions are overseen by the settlement layer. Whereas, the computing layer takes care of the decentralized applications and smart contract computations.
The Cardano founding team’s decision to keep payment and computation segments separate to ease the upgrades in the future. It also enables the Cardano team to make changes to the payment mechanism aka the settlement layer. At the same time, the computing layer remains unaffected. Yet, the end-users of Cardano do not realize such improvements as everything happens behind the scene.
Modified Proof of Stake
Ouroboros is the heart of Cardano blockchain network. It is a modified version of the proof-of-work protocol. The main duty of the Proof-of-Stake algorithm is to select the miner that will create the next block. This selection process is random. Every miner has an equal chance to be selected by the Proof-of-Stake algorithm to create the next block. But the chance is directly proportional to the number of native tokens held by the miner. Let’s explore how it works.
There are two further subdivisions of Time in Cardano. First of which is known as epochs. When you multiple epochs, you will get time in Cardano. Hence, you can call epoch as the sub-part of time in Cardano. Each Epoch can be further divided into slots.
Each of the slots is 20 seconds long. A slot assigned to a Slot leader can only include a single block. Each slot leader receives the distributed share of the total transaction fees pooled in the epoch. Cardano’s slot leaders are the equivalent of the Bitcoin miners.
Cardano does not require an astoundingly powerful computational system from its slot leaders. The same isn’t true when it comes to the Bitcoin miners. Cardano is also far cheaper to run compared to Bitcoin. Yet, the Cardano team says that Cardano offers security which is equal to that of the proof-of-work in bitcoin.
Cardano Roadmap
The Cardano team has segmented its roadmap in terms of eras. These are Byron, Shelley, Goguen, Basho, and Voltaire.
#1. Byron Era
Cardano’s Byron era began in September 2017. It started when Cardano’s first version was shipped. The Byron era also saw the introduction of Daedalus wallet, Emurgo’s light wallet, known as Yoroi, and the official desktop wallet for Cardano token by IOHK. Hence, the Byron era was the era when the base technologies of Cardano were in development. It also included development and building the Cardano community.
#2. Shelley Era
The Cardano team focused on developing the Cardano network in the Shelley era. In the Shelley era, the Cardano team ensured that there were no interruptions while they transition to Shelley. The Cardano team is moving towards shifting the control of nodes in the hands of the Cardano community.
With the Cardano community running the majority of nodes, Cardano will become truly decentralized. The Cardano team believes that at the end of the Shelley era, Cardano will be fifty to a hundred times ahead of other large blockchain projects in terms of decentralization. A reward system was also introduced to the Cardano community under the Shelley update. It was brought in to increase community engagement and increase adoption.
#3. Upcoming Updates
The upcoming updates after Shelley are known as Goguen, Basho, and Voltaire eras.
The Goguen era will enable Cardano to integrate with smart contracts. Hence, the Goguen era will play a monumental role in the Cardano network. Goguen update will enable developers to build DApps on the Cardano blockchain. It is one step next to the Shelley update as the core system of Cardano made a move towards decentralization.
With the Basho era, the Cardano blockchain network will see a huge improvement in terms of interoperability and scalability. The Voltaire era, on the other hand, will introduce a voting and treasury system to the Cardano community. In the Voltaire era, all final pieces will come together to build a truly self-sustaining system for the Cardano network.
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