How Does Cardano Work?
Cardano is built on three main layers: consensus layer, ledger layer, and network layer.
1. Consensus layer
The consensus layer performs two basic functions:

Run the Ouroboros consensus protocol.
Decides to adopt blocks, chooses between competing chains (if any), and decides when to produce its own blocks.
2. Ledger layer
The ledger class specifies the state of the ledger and how the ledger is updated for each new block. The ledger uses the extended UTXO (EUTXO) accounting model.

3. Network layer
The task of the network layer is to maintain connectivity between distributed nodes in the Cardano network. It receives new blocks from the network as they are created by block generator nodes, constructs newly minted transactions into blocks, and transmits blocks between nodes.

Reference: https://taichinh24.net/cardano-la-gi/