The free market will determine Cardano's fate: Charles Hoskinson of IOHK

The free market will determine Cardano's fate: Charles Hoskinson of IOHK - IOHKA high-priced token gives its project crucial decisive power, believes IOHK CEO Charles Hoskinson.

The market has the final say

In an 2018 interview, Ethereum creator Vitalik Buterin said he felt that the price obsession had generated confusion and wrong incentives around cryptocurrencies. "Early idealist programmers wanted blockchain to transfer power from corporations and governments to individuals.

But last year they started to be overtaken by schemes whose sole purpose was to make quick profits. Some ICOs were scams. Buterin was appalled as his blockchain was inundated with quick-earning mercenaries, "says the article.

But Hoskinson, who started out as co-founder of Ethereum before founding IOHK, the main development house behind the Cardano project, thinks otherwise. Although there are certainly other factors that count for the success of a project - a strong consensus mechanism, for example - he firmly believes that the market should have and actually have the final say.

"In the end, people do what allows them to make money," he said. Token designs with commercial success end up inspiring imitations, which means that "the market will basically decide what the standards are."

The most important thing is to be pragmatic

"I've been in the industry for so long that I remember when Peercoin [the first to use proof-of-stake] or Primecoin [which confirmed transactions 8 to 10 times faster than Bitcoin] were in the top 10," said Hoskinson .

Over time, new projects have arrived that have been based on their successes, have improved on some of their failures and have progressively overtaken them on the cap table. Now, Tezos and Cardano are the largest PoS-based currencies by market capitalization; Bitcoin Pro and Bitcoin SV are the most important projects that offer a more scalable Bitcoin.

And Peercoin and Primecoin have become obsolete over the years. Hoskinson argued that the only way to beat competitors is to do the most successful thing, and then try to do it even better.

Of course, there may be surprises. Hoskinson, for example, did not think that Tether or XRP would have been so successful on their first launch. But the market has shown him that he was wrong.

Both responded to user demand, which led them to high ratings and helped make them super tough. That's why Hoskinson thinks that the price is important for Cardano.

A higher price means that there is confirmation from a wider user base that a project has utility and intrinsic value. This gives certainty and resistance to a project.

"Sometimes the market simply appreciates something different and accepts it as a reality, because you can't really fight the market, and then you just have to do your best to work within the limits of a failed system," said Hoskinson. "The events are surprising and what I learned to do is just be pragmatic," he added.