- Charles Hoskinson, the founder of Cardano, believes that cryptocurrency industry should differentiate itself from the unstable and volatile banking sector.
- Three leading financial institutions – Silvergate Capital, Silicon Valley Bank and Signature Bank – were shut down by regulators recently, causing losses for several crypto-focused firms.
- Hoskinson predicted a „game over“ scenario for banks when „we can digitize treasuries.“
Cardano Founder Charles Hoskinson Says Crypto Should Cut Ties With Banks
Charles Hoskinskon, the founder of Cardano, believes the cryptocurrency industry should differentiate itself from the „unstable and volatile“ banking sector. This statement comes after three of America’s leading financial institutions – Silvergate Capital, Silicon Valley Bank, and Signature Bank – were shut down by regulators earlier this month.
The Impact on Cryptocurrency Firms
The collapse of these banks caused severe losses for numerous crypto-focused firms. Circle revealed significant exposure to Silicon Valley Bank with $3.3 billion stuck in it. The asset plunged to as low as $0.87 (CoinGecko data) shortly after that but restored its $1 value in the following days.
In addition, Coinbase said it held $240 million in corporate cash at Signature Bank while Paxos had $250 million held there.
„Game Over“ For Banks?
In response to these events, Charles Hoskinson posted a tweet saying that crypto should stay away from traditional banking since the sector is full of „unstable and volatile“ institutions. He also predicted a „game over“ scenario for banks once „we can digitize treasuries.“
What’s Next for Crypto?
As regulations tighten across various parts of the world, it is yet to be seen how much more pressure will be put on traditional banking systems and how this could affect cryptocurrency markets in turn. What remains clear is that Hoskinson’s sentiment represents an increasingly popular opinion among industry professionals: cryptocurrencies need to find ways to de-risk themselves from traditional finance if they are ever going to reach mainstream adoption.
Even though some investors have been burned due to bad decisions or unexpected regulatory actions against certain financial institutions, it looks like digital currencies are here to stay despite all challenges they face along the way — making it even more important for them to distance themselves from traditional banking systems.
Comments are disabled