What is Cardano? A Beginner’s Guide


Cardano, also known as ADA, is a blockchain-based cryptocurrency platform that works on Proof of Stake. Its aim is to offer a sustainable and secure infrastructure to develop decentralized applications (dApps) and smart contracts.

Launched in 2017 by the blockchain research and development company IOHK, a team of academics and engineers with a strong emphasis on scientific research and peer-reviewed methodologies designed The Cardano.

At the time of writing this article, Cardano is the 7th Largest Cryptocurrency in terms of market cap ($11B). 

Cypher Mind HQ

We will explore the key features, technological foundations, and future prospects of Cardano.

Blockchain Architecture

Cardano blockchain consists of two blockchains, including Cardano Computation Layer (CCL) and Cardano Settlement Layer (CSL). The responsibility of the CSL is handling the ADA cryptocurrency transactions, while the CCL is designed to support the execution of smart contracts and dApps.

This separation enhances security and flexibility by enabling the protocol to undergo updates without compromising the underlying cryptocurrency layer.

Proof-of-Stake (PoS) Consensus Mechanism

Cardano is one of the biggest cryptocurrencies to use the Proof of Stake mechanism. Cardano is committed to sustainability and reducing its environmental impact. It utilizes Ouroboros, which is an energy-efficient consensus mechanism.

Ouroboros ensures the security and integrity of the network by allowing ADA holders to participate in the block validation process in proportion to the amount of Cardano (ADA) they hold. This PoS mechanism is designed to promote decentralization and reduce the environmental impact associated with traditional proof-of-work (PoW) systems.


Cypher Mind HQ

Cardano is known as a blockchain network that addresses the scalability issues faced by many blockchains. To achieve this, Cardano employs a layered architecture combined with a technology called RINA (Recursive InterNetwork Architecture).

This approach allows for the separation of different aspects of the blockchain, enabling scalability improvements and facilitating interoperability with other blockchain networks.

Research-Driven Development

Cardano stands out for its emphasis on academic research and evidence-based development. The protocol’s development process involves peer-reviewed papers and collaborations with academic institutions to ensure the adoption of rigorous scientific principles. This commitment to scientific research enhances the platform’s robustness, security, and overall quality.

Governance and Sustainability

Cardano integrates a decentralized governance model that empowers ADA holders to participate in the decision-making process. This model allows stakeholders to vote on funding initiatives, protocol upgrades, and other important matters through a mechanism called the Cardano Improvement Proposal (CIP) system.

Additionally, Cardano embraces a treasury system that allocates a portion of ADA transaction fees to fund ongoing development, ensuring long-term sustainability.

Smart Contracts and dApp Development

Cardano’s smart contract functionality is facilitated through a programming language called Plutus. Plutus combines functional programming (Haskell) and scripting (Marlowe) to enable secure and reliable smart contract development. This approach strives to avoid common vulnerabilities and makes things easier for developers to develop decentralized applications.

Partnerships and Future Outlook

Cardano has established numerous partnerships and collaborations with governments, academic institutions, and industry leaders. These collaborations aim to explore use cases in the real-world, promote adoption, and foster innovation.

Cardano’s future roadmap includes the implementation of additional features such as sidechains, further scalability improvements, and continued research efforts to advance the ecosystem.


IOHK is committed to using Cardano in Different fields for Smart Contracts and other Uses. IOHK has signed several MOUs, including the Government of Ethiopia, the Ministry of Education (Georgia), etc. There are several other use cases as well.


Cardano has positioned itself as a promising blockchain platform with a strong focus on scientific research, scalability, sustainability, and governance. With its unique architecture, PoS consensus mechanism, and commitment to evidence-based development, Cardano strives to provide a robust and secure infrastructure for the next generation of decentralized applications and smart contracts.

As the platform continues to evolve, it is partnerships, and technological advancements pave the way for wider adoption and long-term success in the blockchain industry.

Author: Isacco Genovesi

Isacco writes news articles, reviews and guides about cryptocurrencies including technical analysis, blockchain events, coin prices marketcap and detailed reviews on crypto exchanges and trading platforms.

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