Coincatch App
Trade smarter
Crypto MarketHot Topics
What Is Cardano (ADA)?
Beginner
2025-07-09 | 10m
Cardano (ADA) is a prominent cryptocurrency within the blockchain industry. Recognized for its innovative technology, energy efficiency, and research-oriented development approach, Cardano seeks to address several of the key challenges associated with earlier blockchain platforms such as Bitcoin and Ethereum. This guide offers a clear and accessible overview of Cardano, including its core functions, operational mechanisms, tokenomics, environmentally sustainable features, and its position relative to other leading cryptocurrencies.
What Is Cardano Blockchain?
Cardano is a broad-purpose blockchain project that uses the Proof of Stake (PoS) consensus algorithm. Cardano, which is referred to as a "third-generation" blockchain, is a solution to the common scalability concerns that plague the majority of "second-gen" blockchains (such as Ethereum and its ever-increasing gas prices).
Cardano was developed from the foundation to provide a decentralized, low-fee, high-TPS Proof of Stake (PoS) network solution. A strict scientific philosophy and a great deal of academic research and development have been put into this.
What Is Cardano (ADA)?
Cardano, or ADA, is one of the biggest cryptocurrencies by market value, designed as a flexible and scalable blockchain platform for running smart contracts and decentralized applications. It was founded in 2015 by Charles Hoskinson (a co-founder of Ethereum) and launched in 2017. Unlike Bitcoin (which was created mainly as digital money), Cardano was built to be a third-generation blockchain, aiming to improve upon earlier blockchains like Bitcoin and Ethereum. In simple terms, Cardano’s developers set out to solve issues of scalability (speed and capacity), interoperability, and sustainability that older networks faced. One of Cardano’s stated missions is to provide financial services to the “unbanked” (people without access to banking), highlighting its focus on real-world inclusion.
Cardano operates through its own cryptocurrency called ADA – named after Ada Lovelace, the 19th-century mathematician often regarded as the first computer programmer. ADA is used on the Cardano network much like ETH is used on Ethereum. You can buy or sell ADA on exchanges, but it also has important uses within the network: you can use ADA to store value, send and receive payments, pay transaction fees, and participate in the network’s operation via staking.
ADA can be used as a secure way of exchanging value by any user, no matter where they are located on the globe, and it does not require a third party to act as a middleman for this to happen.
Every person who possesses ada also possesses a stake in the Cardano network. ADA currently held in a wallet can either be delegated to a stake pool to participate in the profitable operation of the network and earn rewards, or it can be pledged to a stake pool to improve the pool's chances of being awarded rewards.
Currently, it’s trading at $0.5878(July 9, 2025, 01:18:00 (UTC)). The total market cap is around $20.8 billion, and the total supply of ADA is 45.00 billion.
History of Cardano (ADA)
Cardano was founded back in 2017, and named after the 16th century Italian polymath Gerolamo Cardano. The native ADA token takes its name from the 19th century mathematician Ada Lovelace, widely regarded as the world’s first computer programmer. The ADA token is designed to ensure that owners can participate in the operation of the network. Because of this, those who hold cryptocurrency have the right to vote on any proposed changes to the software.
The team behind the layered blockchain say that there have already been some compelling use cases for its technology, which aims to allow decentralized apps and smart contracts to be developed with modularity.
In August 2021, Charles Hoskinson announced the launch of the Alonzo hard fork, causing Cardano price to surge, gaining 116% in the following month. On Sept. 12, 2021, the Cardano ‘Alonzo’ hard fork officially launched, bringing smart contract functionality to the blockchain. Over 100 smart contracts were deployed in the following 24 hours after the launch.
Cardano is used by agricultural companies to track fresh produce from field to fork, while other products built on the platform allow educational credentials to be stored in a tamper-proof way, and retailers to clamp down on counterfeit goods.
How Cardano Works
Cardano runs on a Proof-of-Stake (PoS) consensus mechanism known as Ouroboros. In a blockchain, a
consensus mechanism is the method by which the network agrees on which transactions are valid and in what order to add them to the chain. Cardano’s approach is different from Bitcoin’s Proof-of-Work: instead of miners competing with powerful computers, Cardano uses validators who stake ADA (lock up some of their coins as a stake) to earn the right to create new blocks. This design removes the need for energy-hungry mining hardware and makes the validation process more accessible. In fact, anyone with ADA can participate by delegating their stake to a staking pool (a specialized network node) run by someone else. There is no complex setup or huge electricity bills – even a simple computer or device can help secure the network.
Staking and Selection:
ADA holders can stake their coins by delegating to a staking pool.
Validators are chosen based on the amount of ADA staked – the more you stake, the higher your chances.
This broad participation supports network security without the need for expensive hardware.
Validation:
The selected validator adds a new block.
Other validators verify the block’s accuracy before it is added to the chain.
This decentralized process prevents single-party control.
Rewards Distribution:
Validators and their delegators earn ADA as a reward for securing the network.
ADA remains in your wallet and can be moved at any time, making staking flexible.
Cardano’s Unique Architecture:
Cardano Settlement Layer (CSL): Handles transactions and transfers of ADA.
Cardano Computation Layer (CCL): Runs smart contracts and decentralized apps, isolated from the transaction layer for better efficiency.
Research-Driven Development:
Cardano’s code is based on peer-reviewed academic research.
It uses Haskell for its core, ensuring high security and reliability.
Major upgrades like Alonzo (smart contracts) and Vasil (efficiency improvements) keep evolving.
Tokenomics of ADA
ADA has a fixed maximum supply of 45 billion coins. About 80% of this supply is already in circulation, with the remaining coins gradually released as rewards to participants who help secure the network. This fixed supply ensures ADA remains a scarce asset, similar to Bitcoin’s capped supply, though on a larger scale.
A key feature of ADA’s tokenomics is the high level of participation in staking. Roughly 60 to 70 percent of ADA holders actively stake their coins at any given time. This widespread staking demonstrates confidence in the network, as holders earn rewards by helping to validate transactions rather than merely holding or trading their tokens. Notably, staking on Cardano does not require locking up tokens for long periods — ADA remains in users’ wallets and can be freely moved, making staking flexible and user-friendly.
Beyond staking, ADA is essential for all operations on the Cardano blockchain. Whenever a transaction is made or a smart contract is executed, a small fee paid by ADA is charged. These fees prevent network spam and fund ongoing maintenance. ADA also functions as a regular cryptocurrency for sending payments quickly and cheaply worldwide, with low fees and no reliance on banks.
ADA Value
The fact that Cardano is one of the largest blockchains to successfully implement a Proof of Stake (PoS) consensus mechanism is one of the things that sets it apart from other blockchains to a certain extent. Unlike Bitcoin's Proof of Work (PoW) technology, Proof of Stake (PoS) requires far less effort and power to operate.
It has been a point of pride for the creators of Cardano to ensure that every single piece of technology produced has been put through a rigorous process of research. This means any ideas about the network can be questioned before they are officially implemented. This level of academic rigor contributes to the robustness and stability of the Cardano blockchain, guaranteeing that a significant number of potential problems of the future are discovered well before their manifestation as actual issues.
How to Buy ADA Tokens?
CoinCatch is a global cryptocurrency exchange, trusted by users worldwide with 100% reserve. With its 400+ trading pairs supported, including ADA, users can now trade easily and seamlessly.
Here’s how you can buy ADA tokens from CoinCatch:
Sign up using your Google account or email. Once you sign up, you can start trading assets.
If you already have a CoinCatch account, this is how you can purchase and sell ADA coins on their exchange:
-
Enter your login information: To access your CoinCatch account, visit the website or launch the app and enter your email and password.
-
Put funds in your account to make ADA purchases. You can deposit the funds via bank transfer, credit card, etc.
-
Once you have funds in your account, you may buy ADA by going to the ADA trading page and choosing the trading pair you wish to use.
-
Tokens (USDT, BTC, ETH, and CET, etc.) can be exchanged for ADA. Put in your order and the quantity you want to buy.
Conclusion
Cardano (ADA) stands out as a forward-thinking blockchain platform that combines advanced technology, energy efficiency, and a strong focus on real-world impact. Its innovative Proof-of-Stake consensus and unique two-layer architecture make it scalable, secure, and environmentally friendly. With a growing ecosystem of decentralized applications, financial services, and identity solutions, Cardano is poised to play a significant role in shaping the future of blockchain. Whether you’re an investor, developer, or crypto enthusiast, understanding Cardano’s strengths and vision offers valuable insight into the evolving landscape of cryptocurrency.
CoinCatch Team
Disclaimer:
Digital asset prices carry high market risk and price volatility. You should carefully consider your investment experience, financial situation, investment objectives, and risk tolerance. CoinCatch is not responsible for any losses that may occur. This article should not be considered financial advice.
Share
