Cardano founder Charles Hoskinson just dropped a bombshell: He wants to swap $100 million in ADA tokens for Bitcoin and stablecoins. This risky treasury shake-up aims to boost DeFi liquidity but sent ADA crashing 6% overnight. Here’s why this move could backfire—and what it means for your crypto holdings.
Breakdown: Cardano's Bitcoin Plan
| Term | Details |
|---|---|
| WHO | Charles Hoskinson (Cardano founder) |
| WHAT | Swap 5-10% of Cardano’s treasury ($100M in ADA) for Bitcoin + stablecoins |
| WHEN | Announced June 2025 (ADA fell 6% immediately) |
| WHERE | Cardano blockchain treasury (1.7B ADA tokens) |
| WHY | Boost DeFi liquidity to compete with Solana, Ethereum |
| HOW | Gradual over-the-counter (OTC) sales to avoid price crash |
"If management won’t keep its war chest in Cardano, why should outside investors?" — Market Analyst Reaction
Why This Could BACKFIRE on Cardano Holders
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A Confidence Crisis
Dumping $100M of ADA screams self-doubt. Crypto projects typically hold their own tokens to show faith. Hoskinson’s swap signals leaders fear ADA’s value might keep falling. No wonder investors bolted.
-
The Math Doesn’t Move the Needle
Cardano’s DeFi ecosystem is tiny vs. rivals. Even after this $100M boost:
- Total Value Locked (TVL) would only hit $360M
- Still 22x smaller than Solana’s $8.3B TVL
Blockchain Total Value Locked (TVL) Stablecoin Reserves Cardano (Current) $260 million $31 million Cardano (After $100M Plan) $360 million $131 million Solana $8.3 billion $10.8 billion -
Cardano’s Real Problem: Nobody’s Using It
More cash won’t fix these red flags:
- Top Cardano DEX, Minswap: Only $2.4M daily volume
- Cardano’s biggest stablecoin: Just $50K daily trades
- Meanwhile, Solana’s user base grew 200% in 2024
Without users or yields, this $100M could turn into idle capital—making ADA’s crash worse.
What’s Next for ADA Investors?
With ADA down 35% this year, this gamble feels desperate. Competitors like Ethereum are slashing fees, while Solana keeps growing. Until Cardano fixes its user problem, treasury tweaks won’t save it.
FAQs: Cardano’s Bitcoin Plan
Why swap ADA for Bitcoin?
Hoskinson believes Bitcoin adds "safe" liquidity to Cardano’s DeFi apps. But critics say it shows weak faith in ADA.
How will this affect ADA’s price?
Selling $100M of ADA creates downward pressure. Combined with eroded trust, it could push prices lower short-term.
Is Cardano’s DeFi ecosystem growing?
Not compared to rivals. Cardano’s TVL is < 3% of Solana’s. User activity remains sluggish despite new tech upgrades.
