What is Cardano (ADA)?

Cardano is a blockchain for payments and smart contracts. Its coin is ADA. It uses proof of stake rather than mining, and since 2025 ADA holders vote on how the network changes.

Where it came from

Cardano's first block was created on 23 September 2017. Several organisations are involved, including Input Output, the Cardano Foundation, Emurgo and Intersect.

How it works

Cardano uses proof of stake, explained in Lesson 8. Block producers are called stake pools. Holders delegate their ADA to a pool, and pools with more delegated stake produce more blocks.

Cardano's version has two features that differ from many others:

• No lock-up. Delegated ADA stays in your own wallet and can be moved at any time.
• No slashing. Delegators cannot lose ADA because a pool misbehaves. A poorly run pool just earns less.

Rewards are paid every epoch, a period of about five days.

Governance

A hard fork called Plomin took effect on 29 January 2025. Since then, ADA holders can propose changes and vote on them, directly or through a delegated representative called a DRep. Votes cover protocol updates, future hard forks and withdrawals from Cardano's treasury.

One practical effect: to withdraw staking rewards, a holder must now delegate their vote to a DRep or pick one of the standard options.

Supply

• The maximum is 45 billion ADA.
• Coins not yet issued sit in a reserve. Each epoch, 0.3% of the reserve is released, together with transaction fees, to pay staking rewards.
• 20% of that goes to the treasury, which holders now control by vote. The rest pays stake pools and delegators.

Because each release is a share of what is left, new issuance shrinks over time.

What people use it for

People hold ADA, stake it and use it on Cardano's apps, and holders vote on the network's future.

Risks to know

• Staking rewards come partly from new coins. Lesson 50 explains why a yield paid in new coins is worth less than it looks.
• Governance is new. Holder voting started in 2025, and how well it works is still being tested.
• Price swings. ADA can fall far and fast, like other coins.

Learn more

Lesson 8 covers proof of stake and staking, Lesson 46 goes deeper into how staking works, and Lesson 17 explains market value.