Cardano, or ADA, is often touted as a popular upcoming currency within DeFi; however, have you taken a closer look at their mechanisms?
“Mathematics, however, is, as it were, its own explanation; this, although it may seem hard to accept, is nevertheless true, for the recognition that a fact is so is the cause upon which we base the proof.” ― Gerolamo Cardano, Rome, Italy - 16th Century
Cardano’s name wasn’t hard to find, it is no more theirs than Nikola Tesla’s is Elon Musks. Given the hype behind this project, I wanted to know a little more about their roots. According to Wikipedia, Cardano uses a modified PoS (Proof of Stake) consensus algorithm named Ouroboros. Gerolamo Cardano was a 16th-century mathematician with his hands in many pies such as philosophy, chemistry, physics, biology, and astronomy. It seems like an excellent choice for a coin name as many people in crypto are eclectic or multi-faceted with the same interests, myself included.
Cardano is a “third-generation” smart-contract cryptocurrency. First-generation is comprised of coins such as Bitcoin (BTC) and Litecoin (LTC). The second-generation highlights currencies such as Ethereum (ETH). EOS was the first to be dubbed a third-generation cryptocurrency. These generations are quite relevant to the changes required in software over time as we are presented with new challenges to adapt to. ADA is another potential “replacement” for Ethereum due to their gas fee crisis.
What is also curious as ouroboros is an ancient serpent symbol used to represent the cyclical renewable of life, like that of a phoenix born from the ashes; eternal, a common alchemist’s insignia (symbol). Clearly, they are incorporating ancient history and mythology dating back to Egyptian times into their business model. I can’t help but wonder if they uphold the Gerolamo Cardano name and the ouroboros concept in their project. Another interesting fact is that Cardano was conceptualized by the Ethereum co-founder Charles Hoskinson.
Cardano advertises itself as an open-source technology platform that “will ignite the positive and change the world needs.” We believe the future should not be defined with the past, and that more is possible - and, through technology, can be made possible for all.” I will grant them that it is a well-written pitch; it looks like something I would write under different contexts. The appeal to their ideals is undeniable, and if they are the real deal, my hat is off to them. Unfortunately, for an open-source, decentralized project, those holes I see are a real problem.
One major problem with this project that stands out immediately is that we currently have no way of knowing who has control over their staking pools, removing from the project’s decentralization. This immediate lack of transparency begs the question of who and how many who’s have control; it could only be a handful giving them a massive amount of manipulative ability over ADA block production.
An associate of mine has referred to this as decentralized theatre. Instead, I am calling it pretendralization - when a coin or token advertises itself to be decentralized with a lack of transparency to back its claims. There exists a similar issue within Binance Smart Chain, which I happen to support - for now. I see a lot of FOMO (Fear of Missing Out) and a lot of potential for ADA - but I also see holes. From Ethereum to Nano, I am forced to see the worst in everything, but also the best.
Cardano is currently at a modest price of $1.04 USD with a -2.55% 24-hour loss due to Bitcoin’s ongoing bull-run swings. For how little runs on ADA, I am sure investors are happy to see any growth at all. Many are turning to this currency as an excellent investment. However, I remain unconvinced; all the good intentions in the world can be foiled by a few minute details intended to go against the proposed mission statement. At the same time, they have made for a very compelling marketing scheme with a lot of truth behind it.
For those resistant to EOS, my primary pick to offer dominion to smart-contracts in the future, Algorand (ALGO) is another third-generation cryptocurrency, which clouts as “The First Pure Proof of Stake Blockchain Platform,” and they have made a complete commitment to transparency. I feel this is a safer bet than ADA due to their focus on not putting any of their users in the dark, something I don’t believe we should ever see from an open-source non-profit such as Cardano.
I’ve concluded that while Cardano has a lot of promise, they need to resolve their transparency issues to fulfill their name and back the ideals and concepts driving their mission. I commend them for choosing to run as a non-profit organization, but it would be foolish to believe no one profits from non-profits or NPOs. What if as few as five people controlled the block production for pools - how would you define that as decentralized?
I will be further researching and discussing transitions from first, second, and third-generation cryptocurrencies; any suggestions are welcome. Binance Smart Chain (BSC) is next on my list!
Cardano is being launched on CoinbasePro which will likely fuel the FOMO for investors. Be careful!
I would have allowed debate for this but I do not care for debate based on conjecture. I will not have a hand in spreading misinformation via my comments, no more than I allow scammers to hang out there; it didn't end well for the ADA fans on Voice and I don't want a repeat.
Agree with the content or don't. I recommend you do your own research, anyway!
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I am not a certified financial, tax, or legal advisor, analyst, or planner. The above information should not be considered advice but as an opinion intended to share information and ideas for entertainment and independent research purposes. Cryptowriter and its writers are not responsible for any losses or damages incurred as a result of misinterpreting personal opinions for professional advice.
This article was originally published on Voice.com
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