The founder of Cardano – also a co-founder of Ethereum – has ‘welcomed’ new cryptocurrency investors to the bear market and blamed the collapse in part on ‘Wall Street types’.
The crypto market has recovered by 15% in the last 24 hours following a prolonged nosedive since the weekend which has seen Terra (LUNA) wiped out.
Charles Hoskinson, one of the co-founders of Ethereum, launched Cardano and its ADA token in 2017 via parent company IOHK.
A Proof-of-Stake (PoS) blockchain platform which considers itself to be an updated version of Ethereum and allows developers to create decentralised applications, the open-source project has a goal of helping to create a society that is more secure, transparent and fair.
Its stated aim is to allow “changemakers, innovators and visionaries” to bring about positive global change and “redistribute power from unaccountable structures to the margins to individuals”.
ADA is designed to allow owners to participate in the operation of the network, with those holding the cryptocurrency possessing voting rights over any proposed changes to the software.
Recognising that Proof-of-Work (PoW) networks like Ethereum are limited by the infrastructure burden of growing costs, energy use and slow transaction times, mathematician Hoskinson based it on PoS.
ADA, its native token, hit all-time high of $3.10 last year following the launch of smart contract capability, but is down to just 58 cents today.
“If this is your first cryptowinter, then welcome. Been through many since 2011 and they always hit like a cold ice bath,” Hoskinson tweeted, linking to music from Game of Thrones.
“We are in the panicked blood in the street phase. It clears in weeks to months as a bottom is found. Then a long climb up the ladder.”
Crypto adoption has skyrocketed this year, with daily news of massive VC investment into blockchain startups and ever greater numbers of people investing into tokens.
Institutional investors backing tokens to make money in the short term, rather than back projects in the long-term, could be having an effect.
Hoskinson said: “This was always the danger of inviting the Wall Street types in… and when the markets go not in the direction they want, they dump it.
“They tread crypto just like any other asset and label it as an exotic high-risk one. When the markets do not go in the direction they want, they dump it.”