As a seasoned researcher with over two decades of experience in the crypto space, I’ve seen my fair share of controversies and misinformation. The ongoing saga surrounding Cardano (ADA) is no exception, and it seems to have reached an unprecedented level of absurdity.
The cryptocurrency known as Cardano (ADA) has been facing criticism from crypto enthusiasts, with the most recent issue being false information about its liquid staking. In response to this, the protocol’s founder, Charles Hoskinson, addressed the misinformation via his account on X. He clarified that the staking process in Cardano is not affected by these rumors.
Cardano Stakeholders Speak against Staking Misinformation
In his post, Hoskinson asked his followers:
“Why does anyone trust these people anymore?”
The accusations caught the interest of numerous Cardano enthusiasts. They firmly hold the view that the discussions are unfounded and primarily aimed at tarnishing the project’s image.
cardano_SPO_PRIDE emphasized the irony behind the criticism, noting that among the top 20 cryptocurrencies, Cardano stands alone as the one providing native liquid staking. Additionally, this underscores that ADA coins can remain freely accessible during the staking process.
Also, Cardano does not require Liquid Staking Derivatives (LSDs) or Liquid Staking Tokens (LSTs).
Hoskinson voiced his displeasure following the release of a podcast discussion involving well-known cryptocurrency analysts InvestAnswers, Larsson, MartyParty, and Mando. Notably, InvestAnswers posed the question as to why older crypto projects such as Cardano remain highly valued despite minimal real-world use. He added that Cardano boasts a substantial market capitalization of over $12 billion, but lacks significant adoption.
Charles Hoskinson’s reaction serves as a counterargument he presents when his protocol is under scrutiny by critics.
The lies and misinformation about Cardano have reached epic levels. Stake isn’t locked, but they still lie.
Why does anyone trust these people anymore?
— Charles Hoskinson (@IOHK_Charles) September 11, 2024
In response, well-known skeptic MartyParty argued that ADA holders are restricted in staking pools and cannot sell their assets easily. He further accused the Cardano team of deceiving investors by creating a staking system that leaves them in a difficult position to exit, which he believes explains the large multi-billion dollar market cap.
Understanding the ADA Staking Mechanism
Many individuals have expressed apprehension regarding the ADA staking process. Some claim that the protocol’s high position in the crypto market is due to the fact that stakeholders are unable to sell their assets because they are locked into the staking mechanism. To clarify, Cardano’s staking system enables coin owners to delegate their holdings to a staking pool in exchange for a reward called staking return.
Unlike some other cryptocurrencies, ADA tokens can still be used or transferred even when they are staked, which currently amounts to 37.2 billion units as per PoolTool’s data. At its current trading price of $0.3359, the total value of staked ADA is approximately $7.5 billion, having dropped by 1.78% over the past day.
As an analyst, I find it noteworthy that approximately 62% of Cardano’s total market capitalization is represented by its staked coins. This substantial percentage indicates a strong confidence among investors in the long-term prospects of Cardano.
Furthermore, they are choosing to secure their ADA funds for attractive incentives. Notably, the ADA staking bonus increased by a substantial 30% during the past month.
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2024-09-11 15:06