Cardano and Ethereum: Origin stories

Pioneering the Blockchain Revolution: A Tale of Two Platforms

Cardano and Ethereum, two of the most prominent blockchain platforms, have unique origin stories that set them apart not only from each other but also from other blockchain technologies around the world. Their development stories, foundational principles, and the vision of their creators have significantly influenced the evolution of the blockchain landscape.

Ethereum: The Birth of a Programmable Blockchain

Ethereum, conceptualized in late 2013 and launched in 2015, is often credited with introducing the idea of a programmable blockchain. Its origin story begins with Vitalik Buterin, a young programmer and co-founder of Bitcoin Magazine, who envisioned a platform that could go beyond the financial transactions offered by Bitcoin. The other co-founder of Bitcoin Magazine, Mihai Alisie, also became a co-founder of Ethereum. Ethereum Co-founders numbers 4 and 7, Amir Chetrit and Jeffrey Wilcke, were both core developers at other blockchain projects, Color Coin and Master Coin. These projects were trying to get Bitcoin to expand beyond financial transactions; then Ethereum came along. Charles Hoskinson, co-founder number 5, was running around the internet teaching an online class of 50,000 students eager to learn about the new internet money. The other co-founders, Anthony Di Iorio, Gavin Wood, and Joseph Lubin, were not yet consumed by the new technology but became quick converts after crossing paths with Buterin and reading the Ethereum whitepaper.

The vision set in the Ethereum whitepaper was of a blockchain that could execute smart contracts—self-executing contracts with the terms of the agreement directly written into code. This would enable not just peer-to-peer financial transactions, but also the decentralized execution of complex applications, termed as 'Decentralized Apps' (DApps).

Ethereum's launch was marked by its initial coin offering (ICO), a crowdfunding approach that was itself revolutionary at the time. At the rate of 0.31 USD per eth the public could deposit bitcoin and receive Eth in return. Over 7 million Eth was distributed during the event raising over 3,500 Bitcoin. This event not only marked the birth of the Ethereum blockchain but also popularized ICOs as a means of funding blockchain projects. This was revolutionary because for the first time unsophisticated and sophisticated retail investors alike, could participate in a new form of initial public offering where a group or company raises money from the public. Except this time, you didn’t need to get a bank account, or a special investment account, or give out personal information.

Ethereum's emphasis on programmability and its robust smart contract functionality have made it a foundational platform for numerous blockchain-based applications, from finance to gaming. Because Ethereum is open source, many other blockchain networks are created simply by copying Ethereum’s code. Copy, paste, change a few rules and configurations… and voila, a new chain is born. Even in cases where the entire code is not copied, many blockchain projects that followed after Ethereum extracted the brain of the system, then added new innovations around it. This is because Ethereum’s brain, its virtual machine (the EVM) that sits at the core, is formally specified. The formal specification provides a blueprint that, if followed, means that new EVM-based blockchain are easy to integrate with Ethereum’s vast user base, toolsets, and services.

Cardano: A Research-First Approach to Blockchain

Cardano's story is starkly different. Launched in 2017, it was founded by Charles Hoskinson, one of the co-founders of Ethereum. Dissatisfied with the direction Ethereum was taking, Hoskinson aimed to create a more secure, scalable, and sustainable blockchain. His vision was to use a research-first approach, grounding every aspect of the platform in academic research and peer-reviewed studies.

When it came time to raise money for the work, like Ethereum, Cardano too held an ICO event for some of its funding. Well, it was perhaps an ICO-like event. Cardano’s core devs and early thought leaders have always been insistent on doing things the correct way. Measure twice, cut once is a common saying amongst the Cardano community to embody this ideal. With that spirit in mind, the team was not comfortable offering what looks like a sale of shares in a company to the public, due to strict laws in many countries like the US about how such sales ought to happen. This led to many of the early entities handling the fundraising to incorporate Japan and Hong Kong. The initial sale of Cardano itself was held in Japan according to Japanese laws. Cardano founders prefer to call this initial sale a “Pre-sale” instead of an ICO. It has something to do with vouchers that were later redeemed for ada. You can read more about Cardano’s genesis event at https://cardano.org/genesis/.

The development of Cardano involves a process of continuous refinement and evolution, heavily driven by academic research. This approach sets it apart from many other blockchains that often prioritize development speed over rigorous scientific methodology. Cardano's blockchain operates using a proof-of-stake consensus algorithm called Ouroboros, which is designed to be more energy-efficient than the proof-of-work algorithm previously used by Ethereum or currently used by Bitcoin.

One of Cardano's key features is its layered architecture, which separates the settlement layer that handles transactions from the computational layer that manages smart contracts and DApps. This separation allows for more flexibility and easier upgrades. Additionally, Cardano places a strong emphasis on interoperability and regulatory compliance, aiming to bridge the gap between traditional financial systems and the new decentralized economy.

Comparison with Other Blockchains

Both Ethereum and Cardano offer contrasts not only with each other but with the broader blockchain ecosystem. Bitcoin, for instance, the first blockchain, was primarily designed as a digital alternative to traditional currencies. Its primary function is to facilitate peer-to-peer transactions without the need for a central authority. Ethereum extended this concept by introducing programmability, allowing for a multitude of decentralized applications beyond simple transactions.

Other blockchains like Ripple (XRP) and Stellar (XLM) were created with a specific focus on cross-border financial transactions and payment systems, aiming to streamline and speed up the process that traditional banking systems offer. In contrast, blockchains like EOS and Tron were developed to address some of Ethereum's challenges, such as scalability and speed, by using different consensus mechanisms and architectural designs. Polkadot and Cosmos are developed exclusively with interoperability in mind, a central nervous system that can coordinate and secure distinct interconnected blockchains. Blockchains like Midnight and Monero are aiming to be platforms for building privacy-preserving DApps.

Conclusion

The origin stories of Ethereum and Cardano reflect the diversity and dynamism in the blockchain world. Ethereum's emergence as a programmable blockchain opened up myriad possibilities beyond mere currency transactions, laying the groundwork for the decentralized application space. On the other hand, Cardano’s research-driven and methodical approach represents a shift towards a more sustainable and scientifically grounded development in blockchain technology.

Blockchain is a technology, and the way it’s used doesn’t have to be just one thing!

In the future, you will keep hearing about different blockchains, and it can be confusing to understand why there are so many and which you should pay attention to. Looking at the origin story of a blockchain can be a good way to get your bearings and understand why a given chain exists.

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