Cardano Price Prediction, will ADA’s price hit $0.49?

Cardano (ADA): An overview

Source: Cardano community/Twitter

Cardano (ADA) is a third-generation, fully open-sourced, decentralized public blockchain that operates on a Proof-of-Stake (PoS) consensus mechanism. It creates a platform for hosting smart contracts by developing advanced features that cater to the ever-dynamic nuances of various decentralized applications (dApps).

It is seemingly the first public blockchain platform to evolve out of scientific philosophy. Built on a foundation of high-assurance formal development methods, Cardano aims to achieve the scalability, interoperability, and sustainability needed for real-world applications.

The community/team has designed the smart contracts platform to be desirable for large-scale, mission-critical dApps that could foster the future needs of the economy.

What’s ADA?

Source: Cardano community/Twitter

ADA is the native token of the Cardano network. Simply put, it's a digital currency. It is a secure exchange of value, i.e. without requiring a third party to mediate the transfer. Herein, every transaction is permanently, securely, and transparently recorded on the Cardano blockchain.

Every ADA holder is considered to be a “stakeholder” of the Cardano network. Let’s take a look at it’s diverse utility

• Transaction fees: ADA is used to pay transaction fees on the Cardano network.
• Staking: ADA holders can "stake" their tokens to earn rewards while helping secure the network. By staking, they delegate their ADA to stake pools that participate in the network's consensus process.
• Collateral: ADA is used as collateral to ensure that contracts are executed correctly.
• Governance: ADA holders can use their tokens to vote on proposals for the Cardano platform's evolution.

The total supply of ADA is capped at 45 billion. The initial distribution of ADA, which served as a pre-launch sales event, was the first in the cryptocurrency industry to adopt Know Your Customer (KYC) guidelines. It took place between October 2015 to January 2017.

The genesis block distribution added an additional 20% of the ADA vouchers sold during the sale, totaling 5,185,414,108 ADA. This was distributed among three core entities of the Cardano ecosystem:

• Cardano Foundation: 648,176,761 ADA
• EMURGO: 2,074,165,644 ADA
• IOHK: 2,463,071,701 ADA

From the public sales, 25,927,070,538 ADA were distributed. Thus, the total ADA available at launch was 31,112,484,646 ADA. As of September 2023, 35.1 billion ADA are in circulation.

ADA is derived from the name of a 19th-century mathematician, Ada Lovelace. She is widely recognized as the first computer programmer and is the daughter of the poet Lord Byron.

How does Cardano function?

Source: Iohk.io

Let’s start with the basics. Cardano employs the groundbreaking Ouroboros PoS consensus mechanism, notable for being the first blockchain consensus protocol rooted in peer-reviewed research.

Complementing this innovative approach is Cardano's native smart contract language, Plutus. Derived from Haskell, Plutus is a Turing-complete language. As a result, Plutus smart contracts function similarly to Haskell programs.

Now let’s go into detail and explore the network infrastructure. The platform has been designed with a unique two-layer architecture to separate the settlement and computation layers. This separation offers more flexibility and scalability. The two primary layers of Cardano are:

• Cardano Settlement Layer (CSL): This layer deals with transaction validation and cryptocurrency transfers.
• Cardano Computation Layer (CCL): This layer deals with the computational details, including smart contracts.

Token standards: Like Ethereum's (ETH) ERC-20 and ERC-721 tokens, Cardano has its own token standards for creating custom tokens on its platform without the need for smart contracts. This includes the native token standard, which allows for the creation of tokens directly on the ledger.

Governance and updates: Cardano's approach to governance is participatory. With Project Catalyst and the treasury system, Cardano allows its community to propose and vote on projects and changes, fostering a decentralized decision-making process. ADA holders can vote on proposals, and successful projects receive funding from the treasury.

Interoperability: One of Cardano's goals is to be interoperable with other blockchains and traditional financial systems. This is being achieved through sidechains and other mechanisms.

The evolution of Cardano

Source: Iohk.io

Cardano was founded in 2015 and launched in 2017 by Charles Hoskinson, one of the co-founders of Ethereum. Unsatisfied with some aspects of Ethereum, he envisioned a blockchain that would be built on a more secure and rigorous foundation. 

To achieve this, he founded IOHK, a research and development company. IOHK develops the technology, while the Cardano Foundation is responsible for supervising the development and promoting Cardano.

While tightly holding its spot in the top 10 cryptos by market cap, Cardano has maintained its edge vis-a-vis other smart contract platforms barring Ethereum. At the time of writing, the crypto stood at a market cap of nearly $8.6 billion.

Should it continue to register an uptick in its developmental aspects, the gradual growth could bridge the gap between Cardano and Ethereum in the time to come.

The five eras of Cardano

Source: Iohk.io

Cardano's developmental journey can be understood as follows:

1. Byron: This phase laid the groundwork for Cardano. The mainnet, starting with the Byron ledger rules, served as the foundation. It began as a federated network dominated by Input Output Global and Emurgo and introduced tools like Daedalus and Yoroi wallets and the Block Explorer.

2. Shelley: In late July 2020, the mainnet experienced a hard fork, transitioning from the Byron rules to the Shelley ledger rules. During this phase, Cardano started transitioning from the centralized Byron setup to a more decentralized one managed by the community's stake pool operators.

An essential part of Shelley was the incentivized testnet, demonstrating a blockchain sustainably managed by the community.

3. Goguen: This phase delved into dApps, smart contracts, and custom token issuance, positioning Cardano as a versatile platform for various applications. As Goguen implemented features incrementally, each new set of features came with its hard fork and distinct ledger era:

• Allegra era: Brought in token locking support.
• Mary era: Introduced native tokens and multi-asset functionality.
• Alonzo era: Enabled smart contract support.

4. Basho:  This era is focused on scaling and optimization. The goal of the Basho era is to make Cardano one of the most high-performance, resilient, and flexible blockchain platforms in the industry.

The Basho era will see the introduction of a number of new features and enhancements, including:

• Sidechains: New interoperable blockchains that boost network capacity and allow safe testing of experimental features.
• Parallel accounting styles: While Cardano retains its unspent transaction output (UTXO) model, sidechains will offer both UTXO and account-based models, broadening use cases and interoperability.

5. Voltaire: Centers on decentralized governance. This phase gives the Cardano community voting rights on network evolution, technical augmentations, and funding decisions.

It ensures that not only is the infrastructure decentralized, as introduced in Shelley but its maintenance and future evolution also remain decentralized.