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WHAT IS CARDANO?
"Cardano is a blockchain platform for changemakers, innovators, and visionaries with the tools and technologies required to create possibility for the many, as well as the few, and bring about positive global change"
Cardano is a decentralized proof-of-stake (PoS) blockchain platform designed for a sustainable future where people are empowered to work together in order to build global solutions to global problems. It is the first blockchain platform to incorporate a scientific philosophy and adopt a research-driven approach to technological development. Built and developed by an ever-expanding community of scientists, engineers, and philanthropists, Cardano aims to provide an inclusive, fair, and resilient ecosystem for financial and social applications to thrive on a global scale.
The blockchain itself is underpinned by the groundbreaking Ouroboros consensus protocol — the first PoS blockchain protocol with rigorous security guarantees backed by peer-reviewed academic research.
Want to learn more? Cardano boasts an extensive collection of official documentation and community-created resources accessible to novices and experts alike:
WHAT IS ADA?
ADA is the native token of Cardano, meaning that it serves as the blockchain’s foundational digital currency. The token’s eponym is Ada Lovelace — a 19th-century mathematician commonly considered to be the first computer programmer.
ADA can be used by anybody, anywhere in the world, as a secure exchange of value without the need for any third-party mediators involved in the transaction. Every such transaction is permanently, securely, and transparently recorded on the Cardano blockchain.
Every person who holds ADA also holds a stake in the Cardano network, i.e., the right to participate in, and earn rewards from, the network’s operations. The majority of ADA holders will earn rewards by delegating their stake to a trustworthy stake pool (such as HOLO).
Following the introduction of smart contracts on Cardano in late 2021, ADA can also be used for a variety of decentralized applications and services within the Cardano ecosystem.
HOW DO I BUY/SELL ADA?
The easiest way to trade fiat currency for ADA and vice versa is through a cryptocurrency exchange. Being a top-10 token by market cap, ADA is supported by most major exchanges — for a list, visit coinranking.
One of the most basic security measures holders of ADA (or any currency for that matter) should take is ensuring that nobody else has access to your assets. To this end, it is highly recommended that you only keep your ADA on an exchange so long as it is necessary (e.g., if you intend to sell soon), and otherwise store it in your own crypto wallet.
A hardware wallet (e.g., Ledger Nano S) is among the most secure options since it allows you to remove your private keys from the internet entirely when you’re not using them to sign a transaction. This makes it effectively impossible for anything to be done with your ADA under any circumstances without you physically connecting your wallet to an internet-enabled computer and approving a transaction.
There is also an abundance of other wallets supported on Cardano, many of which are online (light) wallets. These will typically be available through a browser extension, making it extremely quick and convenient to access your ADA for purchases, trading, staking, etc.
WHAT IS A STAKE POOL?
A stake pool is a reliable node in the Cardano network the holds the combined stake of various stakeholders in a single entity. Stake pools are responsible for producing new blocks and form the foundation of the Ourboros consensus mechanism. Pool operators dedicate time and resources to maintain a continuous connection to the Cardano network and help keep it secure by actively participating in the protocol.
The probability that a particular stake pool is chosen to produce a given block increases with the total amount of ADA held by the pool’s delegators. Each time the pool adds a new block to the blockchain, it is rewarded with ADA, and these rewards are distributed amongst the pool’s operator(s) and delegators.
In order to prevent centralization, stake pools are limited in the proportion of the network’s total stake that they can hold — after reaching the limit, any new blocks produced will earn diminishing rewards. This bolsters the overall health and security of the network by incentivizing the creation of new pools and redistribution of delegated stake.
IS STAKING ON CARDANO SAFE?
When you delegate to a stake pool, your ADA never leaves your wallet — you can spend it at any time, regardless of how you’ve chosen to delegate it. Since there is no requirement to lock up funds, staking in general is among the safest things you can do on any blockchain network. For this reason, there is essentially no reason to abstain from delegating your ADA; all stakeholders can and are encouraged to participate in staking.