Cardano is a “second generation” crypto-currency that is trying to solve a lot of the problems that plague Bitcoin. Similar to Bitcoin, it's an open source crypto-currency that launched in September 2017. Cardano uses a token (the actual currency) called ADA. However, most people simply refer to it as Cardano.
Cardano is trying to differentiate itself from Bitcoin by being designed from the ‘ground up’ to deliver a secure and sustainable blockchain that can protect user privacy whilst allowing for regulation. It also hypes up that its been designed by academics and scientists who understand the needs of the marketplace.
However, Cardano isn't the easiest crypto currency to buy, but it's getting easier all the time as more platforms support it. It requires some additional steps compared to investing in Litecoin or Ethereum. But let's break it down and show you what to do.
If you want to get a head start, investing in Cardano can be done easily directly on Coinbase. Right now, you can get $5 free when you open a Coinbase account and make your first trade. Open a Coinbase account here >>
Get started opening those up and follow the directions below.
What Is Cardano ADA?
Cardano was launched in September 2017 via ICO (initial coin offering) to be a better alternative to Bitcoin. The goal was to create a network that valued privacy and security, but at the same time meeting the needs of regulators as well.
As the currency has gained popularity, it's value has risen dramatically. Cardano, like most other crypto-currencies, has seen it's price spike in the recent months.
How Cardano Is Different
The big difference of Cardano compared to other currencies is that it maintains a two-tiered network, which allows for faster transaction processing time (similar to Dash)
Cardano’s multi-layer protocol performs advanced functions, and has at its foundation a settlement layer that is linked to a control layer. The settlement layer will have a unit of account, while the control layer will run smart contracts and will be programmed to recognize identity, assisting compliance.
It's also focused on protecting privacy rights of users, while also taking into account the needs of regulators. This is unique in the crypto-currency space.
The advocates of Cardano see it as one of the best potential currencies to gain mainstream adoption due to it's regulator friendly nature.
ADA Smart Contracts
In September 2021, Cardano launched smart contracts to directly compete against Ethereum. Smart contracts are pieces of code that can self-execute based on certain criteria. This has been a huge game-changer for the crypto and DeFi space, with Ethereum leading the charge.
However, with Cardano implementing their own version of smart contracts, it could see more adoption of the platform.
How To Invest In Cardano
It used to be difficult to invest in Cardano, as you had to start with Bitcoin or Ethereum, transfer it to specialized exchanges, and invest. However, today, you can buy ADA on basically every exchange. See our list of the best cryptocurrency exchanges here.
We're going to use Coinbase to invest in ADA to keep it easy. However, you can open an account on any exchange you prefer.
1. Create A Coinbase Account
The first thing you need to do is setup a Coinbase account. Coinbase is the place where you will hold your Cardano tokens.
What's great about Coinbase is that they support a lot of tokens, and they make it easy to invest in crypto. As we mentioned earlier, you can use any exchange today, and the following support purchasing ADA:
2. Buy Cardano ADA
Once you have your money in your account at Coinbase, you can finally buy Cardano (ADA).
On the home screen, scroll down to ADA, click trade, and you can buy or sell your ADA.
Other Options To Buy ADA
You can also find Cardano on multiple other platforms as well, including Uphold. Uphold is simple to transact in multiple currencies and tokens in one click.
You can also find it on Binance, Kraken, and others.
Final Thoughts
Like any currency, there is a high degree of risk involved if you're considering investing in Cardano. However, given the low price point, it does have the possibility for a high return with low barrier to entry.
If you don't like the idea of a digital wallet and/or all of these steps, there are no ETFs that track Cardano yet. However, GBTC is an ETF that tracks Bitcoin.
You never know, Cardano could skyrocket as high as Bitcoin is today, and you might be thanking yourself in several years. Even better, it could potentially be adopted as a more legitimate currency. But don't get your hopes up - there is still extreme risk here.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.