Cardano Founder Plans $100 Million Liquidity Boost With Stablecoins Bitcoin

Cardano’s founder, Charles Hoskinson, has recently shared a strategic plan to enhance the liquidity of the Cardano network. During a recent live stream on YouTube, Hoskinson proposed allocating $100 million worth of ADA tokens from the network's treasury. The plan involves converting these tokens into a mix of stablecoins and Bitcoin, with the goal of bolstering the DeFi ecosystem within Cardano.

Hoskinson's strategy includes converting the ADA tokens into a blend of stablecoins such as USDM, USDA, and ADA-backed stablecoin synthetics like IUSD, as well as Bitcoin. This move is designed to prime the Bitcoin DeFi network and increase the DeFi to stablecoin ratios, aligning them with those of other leading DeFi ecosystems. The target ratio Hoskinson aims for is between 33% and 40% of stablecoin issuance to the total locked value (TLV) on the network.

Hoskinson emphasized that the daily transfer of millions of ADA tokens means that a significant transfer of funds would have minimal impact on the price of the ADA token. He suggested that liquidity could be enhanced through over-the-counter trades and other mechanisms, allowing the market to absorb a $100 million sale within 30 to 90 days without significantly affecting the ADA price.

Hoskinson's plan represents a proactive approach to strengthening the Cardano network's liquidity and DeFi capabilities. By converting a portion of the treasury into stablecoins and Bitcoin, Hoskinson aims to create a more robust and resilient DeFi ecosystem, potentially attracting more users and developers to the Cardano platform. This strategic move is part of Hoskinson's broader vision to position Cardano as a leading player in the DeFi space, despite the current challenges faced by the altcoin market.