The cryptocurrency Cardano witnessed a price increase immediately after the news release about its likely collaboration with Coinbase cryptocurrency exchange. Cardano was witnessing a fall over 90 % since January 2018. The Cardano blockchain’s decision to adopt Ouroboros gained an all-time attention of the media. Ouroboros is an innovative Proof of Stake (PoS) protocol which aims at higher user security.
In April, The founder and CEO of IOHK, Charles Hoskinson, revealed the details of the Ouroboros (blockchain transaction verification system). According to Cardano, the newly adopted Proof of Stake aims to:
“Overcome scalability, efficiency, and composability limitations of the proof-of-work paradigm, which underlies the security of several mainstream cryptocurrencies including Bitcoin.”
Charles Hoskinson tweeted about the importance of Ouroboros and how well it can be trusted:
Of all the papers IOHK Research has written, this one is the most significant. It's a major advancement for Proof of Stake https://t.co/QNIPonatF6 now PoS has nearly identical properties to PoW. https://t.co/zAP7dSxR3y Welcome to the age of Ouroboros Genesis
— Charles Hoskinson (@IOHK_Charles) April 26, 2018
He further added that once people start using the platform in large numbers, the power of Bitcoin will start to double.
Advantage of PoS
Earlier, the Proof of Work (PoW) was widely used for transactions in the Bitcoin blockchain. PoS (Proof of Stake ) gives an advantage to the users for a stake or vote in the blockchain network. It is said that these PoS characteristics help the network to protect the user’s interest. PoS helps in turning the casual users into active members of that specific blockchain network and reduce the power consumption by the network.
In the present scenario where blockchain technology has been widely adopted, networks will definitely prefer PoS as this is a power-efficient system.
Even though adopting this system is quite advantageous, there are issues to overcome. The concept used in this system is not yet proved and PoW is considered the most validated method of verification until now.
The Bitcoin blockchain has undergone more successful rigorous testing and experimentation than Cardano and the native coin ADA. The impact of Ouroboros on the cryptocurrency market will be tested and proved in the coming days. It is too early to draw a final take as the concept is new and open to challenges. Stay tuned for more updates.