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Decentralization in Question: Hoskinson Calls Out SEC, 'Team Orange'

The Cardano founder raised questions about the true nature of decentralization in the crypto space and the inherent challenges faced by emerging platforms like Cardano.

Charles Hoskinson (Image: screen grab/X)

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In a recent, impassioned address on a two-hour-long "surprise AMA" yesterday, Charles Hoskinson, the founder of Cardano, openly criticized the cryptocurrency industry's regulatory landscape, specifically targeting Bitcoin and the perceived preferential treatment it receives.

Hoskinson, in his characteristic fervor, questioned the regulatory differentiation between Bitcoin, Ethereum, and Cardano, demanding a clear explanation from the Securities and Exchange Commission (SEC), resonating with a broader industry confusion about the inconsistent application of regulatory frameworks.

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“It's a security. Okay, well what the hell does that mean if it's decentralized, how does Bitcoin register? Oh, it's not? Then explain to me the f*****g difference between Bitcoin and Ethereum and Cardano and the rest of the gang,” he asserted.

Further delving into the technicalities, Hoskinson raised concerns about Bitcoin's vulnerability to a 51% attack, attributing this to the way hash power is distributed.

“Tell me. Is there an expectation of return with the goddamn orange pill, moon boys? It's there. There's so many different planks and angles that you can take a look at this thing from. And by the way, if you subpoenaed an attack on about three different entities, you could perform a 51 percent attack on Bitcoin, because that's the way the hash power works,” he explained, in contrast to Cardano's proof-of-stake approach.

"But it's decentralized apparently and 'team Orange' [the bitcoin faithful] gets a complete pass. It's a pathetic f***ing joke," he added.

Price Growth Potential?

Hoskinson's criticisms come at a time when Cardano faces minimal resistance in the market, as recent analysis suggests potential for significant price growth. However, the legal and regulatory challenges that loom over the industry cast a shadow on this optimistic outlook.

Cardano/ADA's price over the past year (Data: CoinMarketCap)

Comparing the crypto industry's legal battles to historical events like the Kennedy assasination, the Vietnam, Iraq and Afghanistan wars, and Covid-19, Hoskinson expressed his frustration with the ongoing legal turmoil. “It's an absolutely pathetic joke. You know, it would be funny if not for the fact that hundreds of millions of dollars of legal fees have been exhausted in this war that's being fought on the industry,” he lamented.

"And they'll lose court case after court case as they already have, and will continue. And then at some point, it'll stop, there will not be an apology, there's not going to be any money that comes back and we'll just move on."

The broader implications of these legal struggles are profound. As Cardano and other cryptocurrencies navigate through a thicket of regulatory uncertainties, Hoskinson feels the industry’s potential for innovation and growth is being hampered.

Right now, it looks like these battles might continue, with no clear end in sight, echoing Hoskinson's sentiments about the lack of accountability and restitution in these situations.

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Regulatory scrutiny can be both beneficial and challenging for the industry. On the one hand, it can bring legitimacy, trust, and investor protection. But achieving global coordination of regulations is complex and time-consuming, across jurisdictions.

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