2021-11-4 02:00 |
Speaking over the weekend in a surprise AMA from Ethiopia, Cardano founder Charles Hoskinson called a viewer “another idiot” following his question about plans to burn ADA.
Recently, rumors of an ADA burn have been building. But as explained by Hoskinson, token burning is a fruitless exercise that won’t achieve what burn proponents expect.
Why burning Cardano won’t workIn setting the record straight on ADA burning, a visibly frustrated Hoskinson pointed out that burning ADA requires someone to lose out. What’s more, the concept of token burning isn’t built into the tokenomics of Cardano.
“Why do people think it’s possible to burn ADA? It’s not, it’s not. I own some ADA, you guys have some ADA. To burn ADA you physically have to forcibly confiscate ADA from somebody and destroy it.”
Broaching the possibility of whether devs can incorporate token burning into Cardano’s tokenomics, Hoskinson dismissed the idea as contrary to what Cardano is all about – stability.
He drilled this point further by questioning why anyone would want to meddle with monetary policy retrospectively. Saying he doesn’t understand why people think a burn is possible or desirable.
“You’re destroying the integrity of the entire cryptocurrency’s monetary policy by tinkering with the monetary policy that was set years ago and that social contract is built by four years of purchasing decisions of people entering the ecosystem.”
Hoskinson believes in fundamentals over short-term gainsTypically, supporters of token burning expect the increased token scarcity to push the price higher. But Hoskinson said the history of token burns, giving Stellar an example, shows this isn’t achieved.
As mentioned on numerous occasions in the past, and again in this AMA, Hoskinson believes an obsession with price is the wrong way to look at things.
Referring to meme coins in the top 10, Hoskinson said protocols that go down the route of gimmicks and hype rarely achieve success in the long term.
“… first they seldom accomplish it in the long term and they sound a lot like the Bitconnect guys, second, the markets are very fickle.”
Instead, projects with a long-term future are committed to achieving a mission based on developing solutions to problems.
“They have real answers for what is the use and utility? Why is this thing here? What’s the point of this stuff?”
And so, while token burning may seem like a quick solution for forcing price action, that in itself isn’t what Cardano seeks to accomplish.
The post Cardano founder sets the record straight over talk of an ADA burn appeared first on CryptoSlate.
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