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2 Key Catalysts that Could Take Cardano Much, Much Higher

By Chris MacDonald – Nov 13, 2021 at 8:15AM

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How one cryptocurrency sets itself apart in a field full of contenders.

Cardano (ADA -1.86%) emerges as a potential top cryptocurrency to watch in this conversation between contributor Chris MacDonald and The Motley Fool's Eric Bleeker on "The Crypto Show," from Backstage Pass, recorded on Oct. 20.

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Eric Bleeker: Let's move on to the last one, which is Cardano, is another potential theory on competitor and now it's now Ethereum (ETH -0.03%) on this list. Similar to Solana (SOL 1.14%), but a little bit larger. So do you want to talk about why Cardano made the list?

Chris MacDonald: Yeah. Cardano is similar to Solana. Probably the two things that intrigue me about Solana are scalability and it's interoperability. I think those are the two unique factors that are focused on with Cardano.

So one of the things about Cardano that's interesting is the Cardano network has an intriguing way to validate blocks and how blocks are validated. They're split up into various slots where the nodes will validate certain -- it's chopped up, essentially, like the entire blockchain is chopped up and divided. As it grows, it gets divided more and more. So as more users come onto the network, the validators in theory will increase as well to allow the network to speed up over time, whereas a lot of other blockchain networks will see a slowing in fees ramp up over time.

So it's very scalable. It's one of the most scalable out there in that regard.

In terms of interoperability, Cardano allows for the bridging between its network and other cryptocurrencies and other blockchain networks via the KMZ side chain protocol. That allows for larger scale projects to be taken on by developers crossing over various blockchains. It suggests that perhaps we're moving toward more of an integrated crypto community right now. It's pretty siloed, when you're on one blockchain, developers are forced to stay on that blockchain, but Cardano provides some real interesting utility in that regard.

Eric Bleeker owns shares of Ethereum. The Motley Fool owns shares of and recommends Cardano, Ethereum, and Solana. The Motley Fool has a disclosure policy.

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