What Was The Main Idea Behind Cardano?

The Cardano team hasn’t set out a proper roadmap or a white paper but they only focused on embracing a “collection of design principles, avenues for exploration and engineering best practices” as the main idea behind this crypto project.

The idea was that this new platform has to solve the biggest issues that one crypto-based project faces on the market. Of course, the first one is- Scalability.

When people talk about “scalability” they think of transactions processed every second or the throughput. However, Hoskinson noted that this is only one part of the problem. The total scalability contains a few elements and Cardano will take care of all of them.

The second pillar is interoperability. The long and short of it is as Hoskinson put it, there won’t be one token that will rule them all.

In the crypto space, there are different crypto coins like Bitcoin, Litecoin, or Ethereum. Similarly in the legacy financial world, there are systems like banks that use SWIFT, ACH, and more. The problem is that it is quite hard for the entities to communicate with one another. This is why crypto exchanges that provide a connection between crypto and banks are becoming even more powerful and important. But here we are facing another problem. Exchanges are not decentralized and are prone to attacks or they blackout in periods of system upgrades.

Also, there’s another area where miscommunication happens and it is ICOs. They aren’t as popular as they were a few years back so we won’t focus on them too much but in ICOs, one entity gets millions of dollars in exchange for tokens but saving the money in their bank account is quite a hard task. The banks want to know where the money came from and this detail is oftentimes impossible to provide.

This is where Cardano steps up as an elegant and risk-free solution.

The main idea behind Cardano is to create an “internet of blockchains” where there will be seamless flows without having to turn to centralized exchanges. This is why cross-chain transfers are something that Cardano wants to bring to the market without middlemen. One way to do it is by implementing sidechains.

A sidechain is a concept that has been around for quite some time now and the idea is very simple. You have a parallel chain that runs along the main chain. The side chain is then attached to the main chain via a two-way peg. Cardano will support the sidechains involving non-interactive proofs of proofs of work. The idea comes from two things mainly: a compressed version of a blockcahin and bringing more interoperability between the chains.

At last, we come to sustainability.

This is by far the hardest one to solve. It means how Cardano will pay for future growth and development. There are a few things that can happen:

ICOs or Patronage.

Both of them come with their own sets of issues. With patronage, you will have the problem of centralization because if a bigger company gives a huge amount of grants to a blockcahin company, they could direct the way of developments in their own way.

With ICOs, it will be like they’ve won the lottery without a sustainable model for the future. Something more sustainable has to be done and Cardano took the inspiration from Dash to create a treasury.