Cardano is a new player in the crypto field. What’s more, its token ADA currently ranks as the world’s sixth-largest cryptocurrency.
Bitcoin and Ethereum are leading at the front of this sphere with massive waves, but Cardano is also giving them tough competition.
About Cardano
Cardano is a popular cryptocurrency among more than 10,000 types of coins. Cardano’s individual units are known as ADA.
The cryptocurrency was created by Charles Hoskinson who also founded Ethereum- another popular coin in this market.
Blockchain technology is used to run Cardano records in every transaction, that occurs using it as an endless receipt book with chronological entries.
What makes Cardano better than other coins?
Cardano has made an indelible mark in the competitive world of cryptocurrency, largely due to its unique process and technology.
First peer-reviewed blockchain: Cardano is the first peer-reviewed blockchain to appear on the cryptocurrency scene.
Before rolling out its protocols, a nonprofit responsible for Cardano assembled a team of experts and academics from various esteemed universities to review them extensively.
Technological advancement: Cardano’s speed and rapid technological advancements make it capable of processing up to a million transactions per second. It is one of the most technologically evolved cryptocurrencies available, now ranking as the sixth-largest cryptocurrency overall.
Problem-solving algorithm: Cardano is different from its competitors in one more way, which is its proof-of-stake technology.
Created to be a less risky alternative, the POS algorithm grants miners mining power according to the number of coins they own.
Is Cardano a good investment?
Many cryptocurrencies like Cardano have been drastically volatile. For example, recently it reached its highs but now it is back down at where many other currencies are.
However, some people still made a lot of money by buying and holding from the beginning in 2017 when this currency was released.
This means they’ve already profited quite substantially on their investment, especially if they bought and held throughout that time period.
It’s important to understand what you’re actually investing your money into before looking at recent gains or losses since Cardano doesn’t have much backing yet.
From that angle, this currency isn’t backed by anything besides itself, which makes it different from almost all others out there including stocks.
A stock is an ownership stake in a company, so even if the company does get better over time, then the stock would likely appreciate too.
In contrast, Cardano investors have no such guarantees or safety nets for their investment. The value of the coin rises and falls with the optimism of traders.
What drives cryptocurrencies is sentiment, speculation, and optimism on behalf of other traders, not success from an underlying business.
Traders figure they can sell it later to someone else at a higher price, what’s called “the greater fool theory of investing” in this situation.
Oftentimes, when this happens there are no more optimistic people left, it has been seen before market crashes happen, after everyone runs away while speculators run for cover.
