Cardano Considers Exchanging US$100 Million ADA to Bitcoin to Develop DeFi
Cardano (ADA) founder Charles Hoskinson proposed that US$100 million from the project's ADA cash reserves be converted into Bitcoin (BTC) and stablecoins to boost liquidity and strengthen the Cardano DeFi ecosystem.
He referred to this move as a way to revive the DeFi sector, which is currently lagging behind other platforms.
In a live broadcast on YouTube, Hoskinson explained that the funds could be allocated to several stablecoins available on the Cardano network, such as USDM, USDA, and IUSD backed by ADA, and some could be allocated to Bitcoin to support BTC-based DeFi projects.
According to him, the ratio of stablecoins to total value locked (TVL) in Cardano is still very low, at below 10%, significantly lagging behind Ethereum (ETH) and Solana (SOL) which are above 100%.
Hoskinson emphasized that out of Cardano's total cash reserves of US$1.2 billion or about 1.7 billion ADA, only around 5–10% would be used for this strategy, so it would not have a significant impact on ADA's price in the market.
“The daily trading volume of ADA is very large, and the sale of US$100 million could be done gradually over 30 to 90 days using TWAP, OTC, and other methods, without significantly disrupting the price,” he explained.
*Disclaimer Alert. Not Financial Advice (NFA). Do Your Own Research (DYOR).*