Bitcoin vs. Cardano – What’s the difference?

It is common for traders to compare Bitcoin and Cardano, as both projects have a strong reputation and have been operating for years. These networks share some features in common, but their overall functionality, options, and purposes are different. Learning these differences is a crucial first step in understanding which project is the best fit for your trading strategy.

What is Bitcoin?

Bitcoin is the world’s first successful cryptocurrency. This coin changed the world forever when Satoshi Nakamoto, the project’s anonymous founder, published his whitepaper in 2008. The following year, Bitcoin was released as an open source project to the world. The token was unique to its predecessors in many ways.

First, Bitcoin was the first decentralized currency that worked properly. It conquered the problem of double spending that had plagued all previous crypto attempts. The double-send problem refers to how early digital currencies can be sent, and then another transaction can be sent before the first one cleared. Nakamoto changed the game when he added a timestamp to transactions that made this hack impossible.

Source – Twitter @Bitcoin

There is a lot of speculation as to why Bitcoin was created. However, Nakamoto never clearly expresses any direct rationale only technical goals such as creating the network “a digital peer-to-peer electronic cash system.” However, he placed some information in the genesis block that refers to another bank bailout.

What is Cardano?

Cardano was created in 2015 by Charles Hoskinson – a former co-founder of Ethereum. Charles Hoskinson wanted to build a programmable blockchain network that was more secure and faster than the competition. The main goal of the project was to create a decentralized network that utilized the scientific method and academic processes during its establishment.

Today, Cardano continues to have strong integration into academic systems. Interestingly, the network is littered with clues to its overall academic goals. For example, the name Cardano comes from the famous Renaissance mathematician Gerolamo Cardano,

What problems was Bitcoin built to alleviate?

Bitcoin helped usher in a new era of decentralized finance. The token has enabled millions of people to escape the crooked economic system. The decentralized nature of the token and its unique characteristics have made it an excellent store of value and is a far more transparent alternative compared to fiat currencies.

Bitcoin eliminated the need for a central bank and enabled society to conduct secure transactions. The coin is much cheaper to send internationally and can be transferred in a permissionless way thanks to the technical capabilities of PoW blockchain networks. Users can send Bitcoin anywhere in the world without worrying about censorship. Additionally, anyone can hold and store Bitcoin. The network is set up to support non-custodial wallets, meaning you are the only one who can ever access your crypto.

What problems was Cardano built to alleviate?

Cardano was built with a more forward-looking attitude than Bitcoin as it had the advantage of entering the market long after. When Cardano entered the market, the crypto sector had already developed considerably. As a third-generation cryptocurrency, Cardano supports the creation of blockchain resources, networks and Dapps.

Cardano was built with sustainability in mind. The network uses only a fraction of the energy required to keep Bitcoin valid. This eco-friendly approach was part of the team’s long-term strategy to make Cardano the ideal programmable blockchain infrastructure provider for the academic sector.

Cardano also improved transaction throughput compared to Bitcoin or Ethereum. Scalability issues have long been a problem in the blockchain sector. Cardano was designed to provide more scalability, reduce network congestion and provide a smart alternative to other programmable networks at the time such as Ethereum.

How does Bitcoin work?

Bitcoin uses blockchain technology to remain valid. The system is designed to place blocks of transactions in sequence based on their timestamps. The network eliminates centralized groups such as banks and replaces these groups with network nodes.

The Bitcoin network nodes go by the name of miners. In the Bitcoin consensus mechanism, these groups compete against each other to be the first to answer a complex mathematical equation. The first node to complete the equitation qualifies for the reward.

This reward is the only time new Bitcoin enters the market. This strategy gives the token a predictive issuance. When you couple this issuance schedule with the limited supply of 21 million tokens, it’s easy to see why Bitcoin has gained value due to scarcity since its launch.

BTC

Bitcoin is the cryptocurrency of the Bitcoin network. This cryptocurrency can be sent internationally and is resistant to censorship. Notably, as the world’s first cryptocurrency, the Bitcoin network is limited in functionality. However, more recent additions such as the off-chain protocol, the Lightning Network, have helped the coin remain competitive in the face of newer, more capable alternatives. In addition, Bitcoin is one of the very few digital assets that has been given some degree of regulatory clarity.

How does Cardano work?

Cardano uses a Proof-of-Stake consensus mechanism. This system differs from the PoW miners needed to keep Bitcoin valid. In the Cardano ecosystem, users can stake their tokens to secure returns. Staking is the process of locking your tokens into a smart contract for a predetermined amount of time.

Source: Twitter @Cardano

Staking networks are faster, more efficient and provide better opportunities for users. The main reason is that they do not require mining rigs or technical skills to join and secure rewards. Another important reason why Cardano is so popular is that the network has a seamless upgrade process. There is no need to perform hard forks to upgrade the network that keeps the system nodes in sync.

ADA

Even Cardano’s token has an academic twist. The token ADA is named after the 19th century mathematician Ada Lovelace. Lovelace is generally regarded as the first computer programmer. ADA can be used to pay fees, access features and send value internationally.

How to buy Bitcoin (BTC) and Cardano (ADA)

Currently, Bitcoin (BTC) and Cardano (ADA) are available for purchase on the following exchanges.

Kraken – Founded in 2011, Kraken is one of the most trusted names in the industry with over 9,000,000 users and over $207 billion in quarterly trading volume.

The Kraken exchange offers trading access to over 190 countries, including Australia, Canada, Europe, and is ours most recommend exchange for US residents. (Excluding the state of New York and Washington)

Maintain – This is one of the best exchanges for US and UK residents which offers a wide range of cryptocurrencies. Germany and the Netherlands are prohibited.

Maintain disclaimer: Assets available on Uphold are subject to region. All investments and trading are risky and may lead to loss of capital. Crypto assets are largely unregulated and are therefore not subject to protection.

Binance – Best for Australia, Canada, Singapore, UK and most of the world. US residents are prohibited from buying most tokens. Use discount code: EE59L0QP for 10% cashback discount on all trading fees.

Bitcoin vs. Cardano – two good options on the market

When you look at these projects individually, you can see that they both have long-term potential and strong followings. In comparison, Cardano has Bitcoin beat in terms of sustainability and efficiency. However, Bitcoin still has more value and has a much larger following due to its scarcity, reliability, network strength and increasing functionality. The most important thing to understand is that both of these projects have the potential to stand the test of time. You can learn more about Bitcoin here and Cardano here.