Hoskinson slams proposal to burn 1.5 billion Cardano’s ADA tokens Hoskinson slams proposal to burn 1.5 billion Cardano’s ADA tokens
The Cardano community is split over burning the $500 million ADA tokens in the project's treasury.
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Updated: Sep. 6, 2024 at 10:49 am UTC
Web Summit / CC BY 2.0 / Flickr. Remixed by CryptoSlate
Charles Hoskinson, the founder ofย Cardano, has voiced opposition to burning the blockchain network’s over 1.5 billion ADA treasury tokens, which are worth around $500 million.
On Sept. 5, Hoskinson, in a social media post on X, pointed out that the treasury assets weren’t just preprinted tokens but were generated through block production and transactions.
Burning these assets, Hoskinson argued, would amount to theft from Stake Pool Operators (SPOs) and ADA holders. He stated:
“The entire treasury comes from people building blocks and economic activity. You are effectively stealing from every SPO and ADA holder if you burn the treasury.”
Hoskinson’s comments come amid growing calls to burn the 1.5 billion ADA tokens in the treasury following the recent integration of decentralized governance on Cardano.
On Sept. 1, Cardano completed the first phase of its Chang hard fork, marking a significant step toward full self-governance. This move positioned Cardano as the first layer-1 blockchain to implement a token-based governance system.
With this development, the Cardano community has begun exploring ways to utilize its newfound governance powers. A community member, Big Pey, recently asked for input on the potential burning of treasury assets, posting:
“Now that Cardano has full on-chain governance. There’s 1.5 Billion ADA in the treasury. The ADA community could vote to burn all of the ADA. Would you vote to burn all of the ADA? If not, what do you think we need to spend the funds on?”
The proposal has sparked mixed reactions. Some see burning the tokens as a positive move that would greatly benefit ADA’s price, while others warn of potential harm from such moves.
Jaromรญr Tesaล, one of the network’s decentralized representatives (DReps), stated that burning the assets would be a “terrible mistake.” He suggested the funds could be better used to support Cardano’s development.
He said:
“We could launch several more Catalyst Funds, use ADA for liquidity in DeFi, accelerate the development of scalability technologies, fund the deployment of USDC and USDT on Cardano, and even invest in marketing.”
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Cardano is a decentralized public blockchain and cryptocurrency project and is fully open source.
Charles Hoskinson, based in Colorado, stands out as a prominent figure in the blockchain and cryptocurrency sphere.
