Cardano Creator Warns Of ‘Vampires’ Taking Over Crypto Space

Charles Hoskinson, the founder of Cardano, a leading blockchain platform, has expressed his concern over the dominance of a few companies in the Bitcoin and stablecoin markets. He also voiced his support for algorithmic stablecoins, which are not backed by any assets.

In a video titled “Legacy is Eating Crypto,” which he posted on X and YouTube, Hoskinson pointed out that Circle and Tether, the issuers of USDC and USDT, respectively, have a huge influence over the asset-backed stablecoin industry. He said that these two stablecoins account for 70% of the on-chain volume, while only representing 10% of the crypto industry.

Hoskinson argued that Circle and Tether are subject to the regulations of the jurisdictions where they operate, and that could affect the holders of their stablecoins as well. He said:

“I’m not diminishing or saying they’re [Tether, Circle] bad actors and that they’re evil people or something. I’m just saying that they exist within a jurisdiction [and] they’re subject to regulation. Crypto is a global asset, [and] the people who hold it are subject to their local regulations.”

He also clarified that stablecoins cannot split into two versions in the event of a hard fork on Ethereum, the network where they originate. This means that only 50 cents back every dollar of theirs.

Hoskinson added that this gives the issuers of asset-backed stablecoins the power to pick sides and harm the community of the other fork.

Bitcoin ETFs Benefit Legacy Firms, Cardano Founder Hoskinson Claims

Hoskinson also criticized the popularity of spot Bitcoin exchange-traded funds (ETFs), which have recently surpassed $10 billion in assets under management (AUM). He said that this has led to the accumulation of over 200,000 BTC by firms like BlackRock and Fidelity, which are driving the prices up, but also taking control of the Bitcoin sector.

He said that these legacy-regulated institutions could shape the crypto projects’ future with their power and punish those who disobeyed them.

“10 legacy-regulated institutions control the vast majority of your value flow and also get to decide the future of all of these projects. Why? Because if you go in a different direction, they won’t list you, they won’t give you a stablecoin, and they’ll dump your coin if you go in a different direction for a project that you love.”

Hoskinson concluded, “Crypto should have ‘eaten’ legacy, but legacy is now ‘eating’ crypto.” He urged the crypto community to support algorithmic stablecoins, which are not dependent on any assets or regulations, and which he believes are more suitable for the global and decentralized nature of crypto.

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Furthermore, the author’s views are for reference only and shall not constitute investment advice. Before purchasing, please ensure you fully understand and assess the products and associated risks.

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