A proposal from Cardano founder Charles Hoskinson has pulled the entire crypto world into a whirlpool of public opinion:
He plans to use 140 million ADA (about $100 million) from the Cardano Foundation treasury to purchase Bitcoin and native stablecoins to 'activate the DeFi ecosystem.'
Upon the news release, ADA plummeted by 6%, and the community was torn into two major factions: radicals shouting "This is the nuclear button to break the ecological deadlock," while conservatives denounced it as "a betrayal of decentralized faith."
Behind the Gamble: The 'Fatal Flaw' of Voltaire Governance
The essence of this controversy is the first major test of Cardano's proud Voltaire governance system. According to the proposal, fund usage will bypass community voting for direct execution, which contradicts the commitment of the Voltaire phase that 'token holders decide the treasury.'
Ironically, Charles had publicly criticized the lack of transparency in the foundation's fund distribution, but now he has become a rule breaker.
On-chain data reveals a deeper crisis: Total locked value in Cardano DeFi is only $412 million, less than 3% of Solana, and the stagnation of the ecosystem has become a consensus.
Charles's logic seems reasonable—"Attract institutions with BTC and activate liquidity with stablecoins," but the cost is sacrificing the narrative foundation of ADA as a base asset.
Torn Community: Idealism vs. Pragmatism
Supporters' Roar:
"Look at those DApps on ghost chains! If we don't use the reserve funds, Cardano will be nailed to the shame column of 'academic public chains!'" a developer raged on Discord. Indeed, Cardano's NFT trading volume plummeted by 62% year-on-year, and the frequency of Plutus smart contract calls is only 0.7% of Ethereum's.
Opposition's Wail:
"If even the founder cannot abide by DAO rules, how are we different from centralized institutions?" The question from community leader Rick McCracken resonates. The Cardano treasury was supposed to achieve democratic distribution through the CIP-1694 proposal, but Charles's 'autocratic' approach has turned the governance charter to waste.
Life and Death Speed: Under the price collapse, hidden currents surge.
Behind the market's foot vote is the cognitive gap between institutions and retail investors:
Whales Bottom Fishing: The top 10 addresses on-chain increased their holdings of 32 million ADA against the trend, suspected of betting on the end of short-term bearish sentiment;
Retail Panic: Centralized exchanges saw a net outflow of 120 million ADA in a single day, and panic selling continues to ferment;
Short Selling Frenzy: The proportion of short positions in the derivatives market surged to 68%, with funding rates hitting a historical extreme of -0.023%.
More critically, Charles's political ally Trump's 'U.S. Crypto Reserve' plan has encountered obstacles, causing ADA to lose its favorable policy moat, and at this time, risk-taking radical reforms are akin to playing with fire.
Ultimate Simulation: Charles's Hidden Cards and Ecological Redemption
This gamble may hide secret calculations:
BTC Staking Leverage: If the purchased BTC is used as collateral to issue synthetic assets, it can quickly increase on-chain TVL;
Stablecoin Wars: If USDM bridges with the Bank of Japan's digital currency, it could replicate USDC's path to compliance-driven rise;
Risk Hedging: BTC holdings can buffer the impact of ADA's plunge on the foundation's assets.
But the premise of all this is whether the community can tolerate the 'original sin of centralization.' Historical experience shows that decisions that violate the spirit of DAO will eventually backfire—just as the Ethereum Foundation's sale of ETH triggered a crisis of trust.
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