#CardanoDebate Charles Hoskinson, the founder of Cardano, recently indicated a significant proposal to enhance the Cardano ecosystem, particularly in the decentralized finance (DeFi) sector. This proposal aims to convert $100 million of ADA from the Cardano treasury into a mix of stablecoins and Bitcoin.
🟢Why is this proposal a potential solution for Cardano?
✅Enhancing Liquidity in DeFi: Cardano is currently facing a liquidity shortage, especially in stablecoins. By converting a portion of the ADA treasury into stablecoins (such as USDM, USDA, and IUSD) and Bitcoin, Hoskinson aims to significantly increase liquidity in the Cardano DeFi system.
✅Stimulating Bitcoin DeFi: Hoskinson believes that utilizing Bitcoin within this transition can 'ignite' the Bitcoin DeFi sector on the Cardano network, opening new horizons for users and developers.
✅Establishing a Decentralized Sovereign Wealth Fund: Hoskinson believes that this transition can pave the way for the creation of a 'Decentralized Sovereign Wealth Fund' for Cardano. This fund would invest in less volatile assets to generate returns, which would then be used to buy back ADA over time, enhancing the value of ADA and making the ecosystem sustainable in the long term.
✅Asset Diversification: This proposal contributes to diversifying Cardano's treasury assets, reducing the risks associated with heavy reliance on the ADA currency alone.
✅Increasing Appeal for Developers and Users: Enhancing liquidity and expanding DeFi capabilities can attract more developers to build applications on Cardano, thereby attracting more users.
✅Despite the potential benefits, this proposal has sparked some discussion within the Cardano community. There are concerns about the potential impact of selling this large amount of ADA on the market price in the short term. However, Hoskinson confirms that the current trading volume of ADA can accommodate this sale without significant impact.
💡💡Official discussions about this proposal are expected to begin at the upcoming Rare Evo event, and it may be implemented before the end of the year, after obtaining the necessary community approvals.
Overall, Charles Hoskinson's proposal is seen as a bold strategic plan to enhance Cardano's position in the decentralized finance world by increasing liquidity, diversifying assets, and creating a sustainable financial model that supports the long-term growth of ADA😇😇.
