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How does Proof of Stake (PoS) solve the Byzantine Generals Problem on Cardano?
Proof of Stake (PoS) is a consensus mechanism used by blockchain networks like Cardano to solve the Byzantine Generals Problem, which is essentially the challenge of reaching agreement (consensus) in a distributed system even when some participants might act dishonestly or maliciously. Here’s how PoS helps resolve this issue on Cardano: Key Principles of Proof…
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Yield Farming
Yield farming is a decentralized finance (DeFi) practice where users lend or stake their cryptocurrency assets in liquidity pools or other DeFi protocols to earn rewards, typically in the form of additional cryptocurrency tokens. The primary goal of yield farming is to maximize returns on crypto holdings by utilizing various DeFi platforms. How Yield Farming…
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Liquidity pools
Liquidity pools are collections of cryptocurrency tokens that are locked in smart contracts and used to facilitate trading on decentralized exchanges (DEXs) like those powered by automated market makers (AMMs). These pools provide the liquidity necessary for users to trade cryptocurrencies without relying on traditional order books and intermediaries, as seen on centralized exchanges. Key…
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Automated Market Maker (AMM)
An Automated Market Maker (AMM) is a type of decentralized exchange (DEX) mechanism that allows users to trade cryptocurrencies without the need for a traditional order book and intermediaries. Instead of matching buyers and sellers like on traditional exchanges, an AMM uses a mathematical formula and liquidity pools to facilitate trades directly between users and…
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What are the types of forks in blockchain technology?
In blockchain technology, a fork refers to a change in the protocol or the software governing the blockchain, creating a divergence in the chain. Forks can happen either intentionally to upgrade the network or unintentionally due to competing versions of the blockchain. The main types of forks are: 1. Hard Fork A hard fork is…
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Mempool
A mempool (short for memory pool) is a temporary storage area where pending transactions are held before they are included in a block and confirmed on the blockchain. When a user initiates a transaction, it is broadcast to the network and first goes into the mempool of participating nodes. Here’s how a mempool works: In…
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Daedalus (Cardano)
Daedalus is a full-node desktop wallet for the Cardano blockchain, developed by IOHK (Input Output Hong Kong), one of the key organizations behind Cardano. It offers a secure, feature-rich way for users to interact with the Cardano blockchain and manage their ADA (Cardano’s native cryptocurrency). Key features of Daedalus include: As a full-node wallet, Daedalus…
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On-Chain (Validator scripts)
On-chain validator scripts in Cardano are part of the smart contract functionality within the network. These scripts are small programs that run directly on the Cardano blockchain, responsible for validating specific conditions or rules when a transaction is processed. Here’s how they work: In essence, on-chain validator scripts are the core mechanism in Cardano’s smart…
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Concurrency (Cardano)
Concurrency in Cardano refers to the ability of multiple transactions to be processed and executed at the same time, without waiting for one another, especially in the context of decentralized applications (dApps) and smart contracts. This is an important concept because, unlike traditional systems where operations happen sequentially (one after another), blockchain systems like Cardano…
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Cryptocurrency Wallet (Cardano)
A cryptocurrency wallet in Cardano is a software application or hardware device that allows users to store, send, receive, and manage their ADA (Cardano’s native cryptocurrency) as well as other tokens and assets built on the Cardano blockchain. A wallet in Cardano doesn’t physically store ADA but instead interacts with the blockchain, helping users manage…
