Tuition Coins

Cardano NFT Marketplace Platform

Tuition Coins are native assets on the Cardano blockchain and exist in a preminted state. Why we selected Cardano as our preferred blockchain for creating Tuition Coins needs to be understood but before we do that it’s important to understand the concept of Proof of Stake.

Proof of Work vs Proof of Stake

Both Proof of Work and Proof of Stake are algorithms that secure the blockchain for users to add new cryptocurrency transactions. But there are some differences between the two. Cryptocurrencies are decentralized and require computer verification to make transactions visible.

Both proof-of-work and proof-of-stake can help users conduct secure transactions, making fraud difficult and costly for bad actors. They have participants prove that they have contributed resources such as energy, computing power or money to the blockchain. The main difference between Proof of Work and Proof of Stake is how the blockchain algorithm defines and selects users to add transactions to the blockchain.

What is Proof of Work?

Proof-of-work consensus algorithms use complex problems that miners can solve using high-performance computers. Problems are solved by trial and error. The first miner to complete a puzzle or cryptographic equation is authorized to add new blocks to the blockchain for transactions. When blocks are verified by miners, digital currency is added to the blockchain. Miners also receive payment in coins.

Proof-of-work systems require fast computers that consume a lot of power resources. As the cryptocurrency network grows, transaction times may slow down because it requires a lot of energy and electricity.

What is Proof of Stake?

Miners commit to investing in digital currency before validating transactions using proof-of-stake. In order to validate blocks, miners must use their own coins. Miners also show when they verified the transaction. Who validates each transaction is randomly selected using a weighted algorithm based on stake size and validation experience.

After miners validate a block, it is added to the chain, and miners receive cryptocurrency as their fee as well as their initial stake. If miners do not validate blocks correctly, miners’ stakes or coins may be lost. By tricking miners into betting, they are less likely to steal coins or engage in other scams – adding another layer of security.

The proof-of-stake system was developed as an alternative to proof-of-work considering energy consumption, environmental impact, and scalability.

Structure of Cardano Blockchain

Cardano is an open-source proof of stake blockchain that provides smart contract functionalities. As such, developers can use it to launch decentralized applications, making them globally available.

Created in 2017 by Charles Hoskinson, one of the co-founders of Ethereum, the Cardano blockchain tries to solve some of the issues of other projects. Namely, it aims to be faster than Bitcoin, more decentralized, and provide cheaper transactions and gas fees than Ethereum.

The Cardano blockchain is composed of two main elements:

  • The Cardano Settlement Layer (CSL) – where all the transactions are carried on.
  • The Cardano Computational Layer (CCL) – used to deploy smart contracts and govern the network. These layers can interoperate and communicate seamlessly. At the same time, they can function separately, allowing transactions to be carried on even when the network is computing smart contracts or experiencing essential updates.

Ouroboros Proof of Stake

A second unique aspect of Cardano is its proprietary consensus mechanism called Ouroboros Proof of Stake. In this validation mechanism, users can become full node validators or delegate their stake to other superusers to validate transactions on the network.

In Ouroboros, time is divided into epochs, and for each epoch, a new set of validators is voted in by the system. This allows for better diversity and decentralization of the pool of validators.

Validators are rewarded with new ADA tokens to distribute to everyone who delegated their stake, effectively creating an opportunity for passive income.

Advantages of Cardano

Cardano has a wide array of advantages. Below are 5 of the most important ones compared to competitors in the crypto sphere.

  • Fast transactions – Cardano is created to be highly scalable. At the moment, it provides 250+ transactions per second, compared to Ethereum’s 15.
  • Cheap gas fees – Additionally, the PoS model allows Cardano to offer nominal transaction fees on its network. The average cost of a transaction on Cardano costs around 0.1 ADA, which equates to a couple of cents. Compare this to the price of Ethereum of $15 per transaction.
  • A higher degree of decentralization – The network becomes increasingly decentralized because everyone can become a node validator in Ouroboros. At the moment, there are more than 1500 validator pools in Cardano.
  • Eco-friendly – one of the main concerns in the 2021 bull run is the high amount of electricity required by PoW blockchains such as Bitcoin and Ethereum. Cardano, with its PoS mechanism, consumes 99% less electricity than either of these blockchains.
  • Passive income – finally, every Cardano holder has the opportunity to gain passive income by staking their ADA coins. The procedure is as simple as purchasing ADA tokens and locking them up in a wallet such as Yoroi. Cardano is an excellent PoS blockchain that provides cheap and fast transactions. The upcoming updates could push this project’s valuation even further up. Soon, we could see ADA compete with Ethereum and Binance Coin for the top 3 cryptocurrencies by market cap.

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