Cardano founder Charles Hoskinson believes that the international currency should be a medium of exchange, settlement and savings, but BTC and ADA do not quite fit this description.
In the recent
interview Harvard International Review, Charles Hoskinson expressed his opinion on what characteristics an international currency should have. When asked if the ADA cryptocurrency can become part of the economic activity of any state, Hoskinson replied that it is unlikely that ADA will ever be used on a par with the state currency. He added that the international currency should simultaneously have three properties: it should be used as a medium of exchange, used for payments and be a reliable store of value. Even bitcoin doesn’t have all of these properties, according to Hoskinson.
“Suppose I am in El Salvador and want to buy food for 0.007 BTC. At the same time, the cost of a product in dollars can fluctuate significantly. People measure everything in dollars, so you need a tool that will provide price stability and predictability so that it can be used for loans. Volatility makes it difficult to use Bitcoin and other cryptocurrencies as a lending instrument, ”said Hoskinson.
He added that algorithmic stablecoins, in particular the Djed stablecoin, could solve this problem. It can maintain its value at a certain level using smart contracts, doing so in accordance with the needs of the economy, while remaining completely decentralized.
The interview also touched on the launch of digital currencies by central banks. Hoskinson believes that government cryptocurrencies will be able to “peacefully exist” alongside private cryptocurrencies, as this will allow people to gain financial freedom. The founder of IOHK explained that government cryptocurrencies are interesting products, but a lot depends on how open these systems are to the latest technologies.
“Before, people had a much more difficult time – they had no choice. Some are fortunate if they were born in a country with a predictable monetary policy, such as Switzerland. Others were born in Zimbabwe, where the monetary system leaves a lot to be desired. Now people will be able to choose what to use: private cryptocurrencies or government stablecoins, regardless of where they live, ”said Hoskinson.
Hoskinson recently criticized users for suggesting that he burn some of his ADA stocks to drive up the price, as he does with ETH. He said that he was not going to destroy people’s invested money and compared it to stealing food from a supermarket.
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