This third-gen option solves previous crypto problems
James Brumley (Cardano): While Bitcoin has clearly been the poster child for the cryptocurrency movement — particularly now that it has its own ETF — the explosion of alternative digital money has thrust a major problem into the spotlight. That is, “mining” these things consumes a massive amount of electricity. Given how the green/renewable energy movement is going just as strong, this clearly creates a marketability problem.
Cardano is an exception to this norm, however.
It’s kind of complicated, but here’s the simple, condensed explanation: Bitcoin miners use their computer rigs to compete for the right to produce an eligible blockchain; this is the “mining” process you hear about. This is very energy intensive, as a mining computer must prove to all other miners that the calculations that have identified a newly found Bitcoin are legitimate.
Cardano is different in that the energy-intensive mining process doesn’t start by proving that the calculation work has been done. Rather, Cardano mining starts with stunningly simpler (although still secure) proof that the miner in question already owns a stake in Cardano. That miner then is randomly assigned the right to create a new digital coin. Not only does this process require less than 1% of the electricity needed to mine a bitcoin, Cardano’s underlying tech makes it more interoperable. That just means it’s more usable in more ways, and not stymied the way other cryptocurrencies’ 24/7 networks are.