#CardanoDebate

Cardano Debate Today: $100M Stablecoin Liquidity Proposal Divides Community

Cardano is in the spotlight today as a new treasury proposal stirs intense discussion within the community. The plan suggests deploying 140 million ADA—worth nearly $100 million—to boost stablecoin liquidity on the network. Supporters believe this move is essential to strengthening Cardano’s DeFi ecosystem, allowing deeper market integration and broader utility for stablecoins like USDM.

However, the proposal has drawn sharp criticism. Some argue that such a large deployment risks immediate selling pressure on ADA, especially if traders try to front-run the treasury's actions. Critics suggest exploring other mechanisms, such as minting crypto-backed stablecoins, to avoid direct token liquidations.

Cardano founder Charles Hoskinson defended the proposal, calling concerns over sell pressure exaggerated. He explained that the treasury could offload ADA in a controlled, strategic manner—possibly through over-the-counter (OTC) deals or algorithmic methods like time-weighted average pricing—to reduce market disruption. He added that the initiative could generate sustainable revenue for the ecosystem and address Cardano’s current DeFi limitations.

The proposal has clearly split the community. Some see it as a necessary step to compete with other DeFi platforms, while others worry it may hurt ADA’s market performance in the short term, especially as it struggles to gain bullish momentum above current resistance levels.