• Snowy Stake Pool

What is Ada? Pt. 1

Updated: Oct 13, 2021


In our last post, The Basics, we covered the fundamentals of a decentralized blockchain platform. We learned that Cardano is a decentralized blockchain platform. The next question you're probably thinking is, "What is ada and how is it related to Cardano?" Technically speaking, ada is a digital currency and the native token of Cardano. As usual, this doesn't really help us grasp the concept of what ada actually is. To help with this, we'll continue our approach of using a real-world scenario to explain.

As we jump in, it's useful to know the origin of the name in order to help with the pronunciation: Ada is named after the mathematician Ada Lovelace and pronounced as such.

In this scenario, let's imagine that ada is exactly like a physical form of currency. For the sake of our example, we'll use the USD. In fact, let's pretend that the United States uses ada as its national currency and that one ada is equal to the value of one USD.

The Haircut

It has been about a month since Joe had his hair cut last. He calls his barber and books an appointment for that afternoon. As noon comes and goes, Joe makes his way down to the local barbershop. On his way, he stops at an ATM to withdraw some ada in order to pay. He continues to the shop and as he enters, he's greeted with a familiar jingling from the bell above the door and promptly shown to his seat. The barber makes small talk while cutting Joe's hair and finally asks Joe if everything looks good. Joe looks at himself in the mirror for a moment, inspecting every angle and finally nods his approval. The barber states, "That will be 15 ada."

Joe pulls out his wallet, counts out 15 ada and hands them over to the barber. The barber accepts it and stashes it in his own wallet. The two shake hands and Joe is on his way, feeling fresh and slightly lighter around the head.


What we can gather from this story is that ada can be exchanged for goods and services just like any other currency. The story hints that ada has transaction fees associated with the transfer of funds, those transactions are recorded, it can be kept in a wallet, and it can be transferred from one wallet to another. Although these statements are true, there are key differences in the exact details of how it all works. In part two, we break apart this same story to explore those differences and show how ada can be used in its true, digital form.

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