Cardano is an open-source, public smart contract platform utilizing a Proof of Stake consensus mechanism.
Cardano self-identifies as a third generation blockchain protocol, which began with an unstructured collection of ideas addressing flaws in the first generation blockchain protocol (Bitcoin) and second generation protocol (Ethereum). Cardano aims to inherit the successful features and lessons learned from earlier blockchain projects, discard flaws, and incorporate new technologies and best practices that emerge from a research based approach. Cardano identifies three major problems with the bitcoin and ethereum protocols in the areas of scalability, sustainability, and interoperability.
Cardano is being developed by an international team of academics and engineers. Three primary organizations contribute to its development including cryptocurrency research company IOHK led by Ethereum cofounder Charles Hoskinson, the Cardano foundation, and a Japan-based startup accelerator called Emurgo. Cardano is built in the Haskell programming language with peer-review and high assurance software standards baked into their development process.
Flexibility is a key consideration as development of the platform in planned in layers, to better facilitate ongoing maintenance and easier upgrades over time through soft forks. A core component differentiating their platform from other smart contract projects is “Ouroboros”, which they claim to be the first Proof of Stake consensus algorithm that is scientifically proven as secure.
The Cardano token, “ADA”, can be used to send and receive digital funds, and must be used with their digital wallet, “Daedalus”. Currently the team is working to complete the settlement layer that will run ADA, and will then shift focus to build an additional layer to handle smart contracts and dapps.