The platform began development in 2015 and was launched in 2017 by Charles Hoskinson, a co-founder of Ethereum and BitShares. According to Hoskinson, he had left Ethereum after a dispute over keeping Ethereum nonprofit. After leaving he co-founded IOHK, a blockchain engineering company, whose primary business is the development of Cardano, alongside the Cardano Foundation and Emurgo. The platform is named after Gerolamo Cardano and the cryptocurrency after Ada Lovelace.
The currency debuted with a market cap of $600 million. By the end of 2017, it had a market cap of $10 billion, and reached a value of $33 billion briefly in 2018 before a general tightening of the crypto market dropped its value back to $10 billion. According to Mashable, Cardano claims that it overcomes existing problems in the crypto market: mainly that Bitcoin is too slow and inflexible, and that Ethereum is not safe or scalable. Cardano is considered a third-generation cryptocurrency by its creators.
Cardano is developed and designed by a team of academics and engineers.
Cardano uses Ouroboros proof of stake technology. In contrast, Bitcoin uses the proof of work system; the first blockchain entry and the longest blockchain (blockchain with the most computing power) is used to determine the honest blockchain. Cardano uses only the first blockchain entry, whereafter the honest chain is proven locally without the need of a trusted party.
Within the Cardano platform, Ada exists on the settlement layer. This layer is similar to Bitcoin and keeps track of transactions. The second layer is the computation layer. This layer is similar to Ethereum, enabling smart contracts and applications to run on the platform.
Atypically, Cardano does not have a white paper. Instead it uses design principles intended to improve upon issues faced by other cryptocurrencies, such as scalability, interoperability, and regulatory compliance. It is funded by an initial coin offering.
According to Hoskinson, proof-of-stake blockchains like Cardano have significantly smaller energy requirements than those associated with proof-of-work chains such as Bitcoin (see also Bitcoin#Energy consumption).
Cardano’s smart contract language allows developers to run end-to-end tests on their program without leaving the integrated development environment or deploying their code.
In 2017 IOHK helped the University of Edinburgh to launch Blockchain Technology Laboratory. In 2019, the Minister of Education of Georgia, Mikheil Batiashvili, and Charles Hoskinson, signed a memorandum of understanding with the Free University of Tbilisi to use Cardano and Atala to build a credential verification system for Georgia. In 2018 Cardano teamed up with Ethiopian government so Cardano can deploy their technology in a variety of industries throughout the country. IOHK, the company behind Cardano, donated $500,000 gift in Ada to the University of Wyoming to supports the development of blockchain technology. Footwear manufacturer New Balance Athletics will use distributed ledger blockchain to track the authenticity of its newest basketball shoe. The platform will be built atop the Cardano blockchain.