For many cryptocurrency investors, once you get past the big names at the top of the list of currencies by market cap, the next contenders are essentially interchangeable. For supporters of Cardano (ADA), however, there are many reasons to set the number 7 cryptocurrency by market cap apart from its competitors. Others find the ecosystem behind ADA to be overly complicated, preferring to pass it by in favor of simpler projects. Nonetheless, Cardano could potentially overshadow major players like bitcoin and ethereum in the future.
Third Generation Project in the Works
Cardano is unique in comparison with other digital currency projects for several reasons. First, it defines itself as a third generation blockchain, meaning that it attempts to solve problems which have plagued its predecessor coins and which have yet to be resolved more broadly across the industry. Second, and perhaps more importantly, Cardano is not fully implemented at this stage. It is a project in development, with a network that is not completely deployed. Supporters of ADA follow the progress made by the coin’s developers on their website, which includes detailed updates about advancements to the coin and the network. These supporters also tend to believe that, once the network is fully deployed, Cardano could topple some of the most prominent digital currencies of today.
Cardano, Ripple, and Ethereum
One of the targets that Cardano developers have in mind is Ripple (XRP). XRP has made a name for itself through its development of payment solutions which involve centralized agents like banks. XRP transactions are incredibly fast, meaning that it has wide appeal for everyday business uses at this stage.
Where Cardano could beat XRP would be in scalability. According to Zycrypto.com, Cardano in implementation has recorded 20-second periods with a processing capacity of 257 transactions per second. Although Ripple itself is built with scalability in mind, Cardano offers another approach to layer-based architecture that could give XRP a run for its money.
Another contender is ethereum. Ethereum dominates the smart contracts space; however, Cardano also aims to offer smart contracts which could prove to be more efficient than those of ethereum. Ripple is reportedly also considering a smart contracts component as well, so ethereum’s period at the top of the list may be short-lived.
Investing in cryptocurrencies and Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual’s situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns bitcoin and ripple.
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