What is Cardano?
Cardano is a proof-of-stake blockchain platform designed to offer secure, scalable, and sustainable solutions for decentralized applications and systems. Developed through scientific research and peer-reviewed methods, it aims to revolutionize how blockchain technology is built and maintained. Cardano is powered by ADA, its native cryptocurrency, which fuels network transactions and staking. For more comprehensive description, visit this section on our website: Basic Concepts
What makes Cardano different from other blockchains?
From a technical standpoint, Cardano stands out due to its layered architecture, which separates the settlement layer (for ADA transactions) from the computational layer (for smart contracts), enhancing security and scalability. Additionally, Cardano uses the Ouroboros proof-of-stake consensus algorithm, making it more energy-efficient compared to proof-of-work blockchains like Bitcoin. Its commitment to peer-reviewed research and rigorous development ensures that it stays on the cutting edge of blockchain technology. Beyond the technical aspects, there are other key factors, such as Cardano’s large and highly engaged community, which actively supports its ecosystem and promotes decentralization.
What is Ouroboros?
Ouroboros is Cardano’s proof-of-stake consensus algorithm. It is designed to secure the blockchain through staking rather than energy-intensive mining, making it more environmentally friendly than proof-of-work blockchains like Bitcoin.
What is ADA?
ADA (or ₳) is the primary cryptocurrency used on the Cardano blockchain network, named after Ada Lovelace: a 19th-century mathematician who is recognized as the first computer programmer, and is the daughter of the poet Lord Byron. ADA tokens has 6 decimal places, demoninated as Lovelaces.
Where can I buy/sell ADA?
You can buy or sell ada for fiat or other cryptocurrencies using cryptocurrency exchanges, such as Binance, Binance US, Coinbase, Bittrex, and many others.
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What is a crypto wallet?
Crypto wallets store your private keys, keeping your crypto safe and accessible. They also allow you to send, receive, and spend cryptocurrencies like Cardano.
What is staking?
Staking is the process of actively participating in transaction validation on a proof-of-stake (PoS) blockchain. By helping to secure the network, you earn Staking rewards.
How do I stake?
In order to stake your ADA, you need to have your funds in a wallet. The next step is to delegate your funds to a chosen stake pool, such as 1COMM. You may check the steps on our How to delegate page.
Is there a minimum amount of ADA I can stake?
The first delegation will require a 2 ADA deposit, which is refunded if you withdraw your stake key, and the delegation will cost a transaction fee (~0.17ADA) to have it registered in the staking process.
When I delegate my stake do I lose access to my funds?
No. Your funds will not be locked to stake or leave your wallet to stake. You will always have access to your funds and may transfer it out of your wallet anytime.
Are there any risks of losing my funds by delegating my stake?
No, there are no risks for delegating. The stake pool you delegate to doesn't have access to your funds and as such, if the stake pool goes offline / closes you will not lose your funds.
What is stake pool saturation?
Saturation is the limit of ADA a stake pool should be eligible to have, defined by Cardano's governance K parameter. If a pool is saturated, its ROA (return on ADA) will be diminished>
What does it mean to mint a block?
When a stake pool mints a block, it records the transactions in that block. The pool and its delegators earn rewards from both the transaction fees and block reward.
How is it defined which stake pool mints a block?
Blocks are assigned based on a pool's stake relative to the total network, with randomness factored in. Pools must be active when their slot arrives to mint the block successfully.
What is a stake key?
A stake key is a unique identifier that connects your ADA holdings with your chosen stake pool. When you delegate your ADA, the blockchain uses this key to ensure your rewards are cor>
How often can I change my stake delegation?
You can change your stake delegation at any time. However, the new stake pool delegation will only take effect at the start of the next epoch (every 5 days).
What happens if I don't redelegate my stake when a pool closes?
If your chosen stake pool closes, your funds are still safe in your wallet. However, until you redelegate to another active pool, you won't earn rewards.
How long does it take for me to receive my first staking rewards?
This depends exactly when you staked - you will see your reward within at least 15-20 days. For more information, please check this post.
Why does my reward fluctuate so much?
The reward varies to balance the distribution of blocks in the network and according to a luck factor. In the long run, however, all pools will render the same ~3%, as long as they are not saturated and running accordingly.
What do you mean by balance the distribution of blocks in the network on the previous question?
A pool will have more blocks assigned by the network according to how much it has in stake. However, it is not always possible to mint in the exact proportion. A pool estimated to mint 1.5 block per epoch, according to the pool size, cannot mint 1.5 block as block should be a whole number. In this case, the pool would likely mint 0 or 1 block, or 2 or 3 blocks.
Does more minted blocks mean more rewards?
There is a catch in this topic. It is correct to say that more blocks means more rewards, however the correct way of analyzing this should be in relative to how much was minted according to the estimated block quantity for the pool size, not in absolute value.
If a pool has a size to generate 1.5 block per epoch and mints 2 blocks, the ROA (return on ADA) will be above ~3%.
On the same time, if a large pool has a size to generate 30 blocks per epoch and mints 27 blocks, the ROA will be below ~3%.
When I receive my reward, do I need to stake again?
No, your reward is automatically considered in the stake for the same pool your wallet is currently staking. This also applies to any additional ADA the you add to your wallet after delegating your stake.
Can I compound my staking rewards?
Yes, your rewards are automatically added to your stake, meaning they are compounded without any additional action needed from you.