Cardano (ADA) creator Charles Hoskinson says that meme coins have reached market caps of billions of dollars despite lacking user utility.
The CEO of the blockchain tech firm responsible for the development of Cardano, Input Output Hong Kong (IOHK), tells his 291,000 YouTube subscribers that crypto projects should be evaluated based on their mission and vision.
“… we have Dogecoin (DOGE), Shiba Inu (SHIB). They have accumulated technically tens of billions of dollars of value but there’s no real user utility outside of the fact that there’s a social network behind them.
But the adherents of these things will argue that these social networks themselves represent the value and therefore, that’s all you need.
Old school people like me say you have to have real fundamentals, real transactions, real commerce, a potential for user utility, a path to these things and a view of how these things are going to work in the world, change the world.”
The Cardano founder says that the extremely high returns of some crypto assets have resulted in unrealistic expectations in the industry.
“Every year, we will see thousands of cryptocurrency-related projects launching around the world without end, regardless of economic conditions. It’s also created a distortion about our expectations of return. And many regulatory bodies have warned people about this.
But it is unrealistic if there’s a 100x or something to expect that to happen every single year. It just can’t. Math doesn’t work that way.”
According to Hoskinson, unrealistic expectations have bred impatience in the crypto industry.
“But as a consequence of local returns, people have developed very unhealthy views on how long things should take and where value comes from. And many people are starting to subscribe to the Greater Idiot Theory of get-in-fast, get-out-fast and somehow you will have this great life.”
I
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inboxFeatured Image: Shutterstock/tutsi