Cardano has received much attention since its public launch as what many consider to be one of the most exciting cryptocurrencies of 2018. In the past several weeks, Cardano has kept a fairly consistent hold on its place as the fifth largest cryptocurrency in the world in terms of market cap.
However, not all of the buzz has been positive. By some accounts, ninety-five percent of buyers in Cardano’s ICO were of Japanese origin; conspiracy theories and accusations of foul play have arisen in relation to Cardano’s decision to establish itself in Japan. Additionally, Cardano has been named by some significant voices in crypto community as ‘vaporware.’
Recently, we spoke with Charles Hoskinson, Founder of Cardano, to ask for Cardano’s side of the story.
Why was Cardano AD marketed so specifically to Japanese investors? It’s estimated that 90 percent of ADA’s ICO buyers were of Japanese origin.
Hoskinson noted that this “Japanese bias” is due to the project’s origin, but also because of their sales strategy.
According to Hoskinson, there are three Asian crypto markets that “matter”: China, Japan and South Korea. Of these three, Cardano decided to focus on Japan, because it’s “the friendliest, most favorable, and [offers] the most long term growth”
Once Japan sales gained traction, they decided to postpone their plans for South Korea.
As for China, they decided to avoid it due to regulatory perils. Hoskinson noted that they feared that someone in the Chinese government would say “hey, maybe this Crypto thing is not such a great idea, let’s try to control it.”
As for European and US markets, Hoskinson said they considered it as a “secondary offering”.
Thanks to these tactics, the coin was at a whole different point when it was officially launched: ”It launched at around 700 million on Bittrex, and now the whole world is participating. We’re starting to see a churning of supply throughout.”
Moreover, they saved big money on taxes: “If you make a quick buck, you have to give more than half of it to the government. I think it’s better to wait a little bit to liquidate.”
Some other reports have emerged that as far as some of the marketing of ADA in Japan, that it was marketed as an “investment to retire on”. Do you know anything about that?
In response to this question, Charles acknowledged that he was aware of a wide variety of rumours and accusations of illicit activity and immoral marketing with regards to the Cardano ICO, including a story that “[Cardano] had people dressed up in panda suits to convince children to start gambling.”
He categorically denied that Cardano itself had any responsibility in any of the controversy surrounding the ICO, although he did not deny that such things may have taken place: “The reality was that the sale was done by other entities, not us. We didn’t write any of the marketing materials, and there were 1400 people involved in the sale. And guess what? You can cherry pick when you have 1400 people involved in something–at least one person is not gonna be a good person.”
Charles said that similar problems have affected Ripple and Ethereum, and that “this is an invasive, pervasive problem throughout the entire cryptocurrency space,” one that often casts the cryptos associated with this issue in a sinister light–accusations that Cardano “preyed upon the elderly, that this is a pump and dump, and that this is just a cash grab for people.”
He also provided some specific examples with regards to how Cardano took steps to protect ICO participants, saying that “everyone went through compliance.” He added that “less than five percent of the people who bought it [Cardano] were over the age of 65.”
Furthermore, Charles noted that Cardanos’ was “the only crowdsale that ever did consumer protection.” Participants in the Cardano ICO “could ask to have [their certificates that were vended in the month of March] backed up.”
“We did it because we cared,” he added.
He also spoke of Cardano’s ‘Help Desk’ tour of Japan, in which Cardano representatives went to different cities and taught people “how to install Daedalus [the Cardano wallet], how to redeem their ADA, and how to use the wallet, including how to use an exchange if they wanted to sell.”
Trading Places: Finding The Best Jurisdiction for Your BrokerageGo to article >>
Despite the efforts that Charles said that Cardano has taken to protect and educate users, there are still plenty of voices in the crypto community who are ready to through it under the bus: “there are some people in the cryptocurrency space, who privately have purposely, for competitive reasons, pushed these rumors and these allegations, amongst other things, out there.”
He continued, “It is bizarre. It is patronizing, it is insulting, it’s slander, and it has to stop. You can dislike the technology, you can dislike people, you can think I’m an asshole. Great, let’s have that conversation. But don’t say I defrauded people, and don’t say I defrauded the elderly. That’s wrong, and it’s slander.”
Another thing that Cardano has received criticism for is its association with Tadashi Izumi, who has been closely linked with the NoahCoin. NoahCoin has been criticized as a ‘scamcoin’. How do you respond to that?
When asked about Cardano’s relationship with Tidashi Izumi, Charles had some choice words: “He’s one of those 1400 distributors and I don’t have any business relationship with Izumi. He owns nothing at Emergo, nothing in the CF, nothing in IOHK. We don’t endorse NoahCoin, we don’t endorse any of his projects. He was an independent agent, working with 1400 other people. I disavow him, I want nothing to do with him. I don’t know the man.”
Charles acknowledged that he and Izumi may have been associated by happenstance: “I’ve sat in at a couple of seminars where I talked about the technology of Cardano, and we even had a contract saying no selling of ADA could be done at these seminars. Then somebody takes a picture of me with him, and then suddenly [Cardano is made up of] the worst people in the world.”
He cited the cryptosphere’s tendency to make assumptions based on the oversimplification of various pieces of informations as another pervasive problem within the industry: “They did the same thing to Vitalik [Buterin, creator of Ethereum], he was in a picture with Vladimir Putin, they said, ‘you were at a seminar and Putin was there, that must mean that Russia is backing Ethereum, and Russia is behind it, and Vitalik is a sellout to Russia.’”
On a more personal note, Charles added that he’s used to these “politics of personal destruction” because “he’s been dealing with it for a lot of years. However, he noted that he isn’t the only one affected by the various vitriolic accusations: ‘all you people who are doing that, know that you’re really pissing my mom off. You’re making her sad. She’s upset about that.”
In the past there’s been a little bit of controversy about your decision to exit Ethereum and Lisk. How can Cardano investors be certain that you are here to stay as part of this project?
Charles said that the proof was in the pudding: “Well I’ve been here for 3 years already, they keep saying that I go away in 6 months, but I’ve kind of already gone past that threshold. The other thing is that I’ve stuck around at Ethereum Classic for damn over a year, putting my own money to build a client. We’ve just released the client, so we’ve honored that commitment.”
“I firmly believe that if I’m involved in something, it has to be worth my time, and it has to be worth the ecosystem’s time. If the ecosystem is paying me money, are they getting their money’s worth?,” he said, and explained that his decision to leave Lisk was essentially because he felt that he wasn’t useful there.
He added that ultimately, his contributions to Cardano and his future role in the cryptocurrency will be evaluated by the users: “the community will get to decide who Charles Hoskinson is, and the value that I provide to the ecosystem. As for my track record, I’ve taken a company from 2 people to 100 people. We operate in ten countries, we’ve written 70,000 lines of code, and we keep accelerating. We build great processes, we have three research centers (one at University of Edinburgh, One at Tokyo Tech, and one at University of Athens).”
We are thrilled to announce that we will be integrating Ledger hardware wallet in our Cardano ecosystem. This means users will be able to hold their Ada offline, through the convenient and highly secure means of cold storage. https://t.co/yzEazs5BTS
— Cardano Foundation (@CardanoStiftung) February 3, 2018
Charles said that he is happy with the work that he’s done so far: “[Cardano has] long-term relationships and commitments, very few people leave my company, and I’ve been very honest with who I am and what I do. I’m proud of my record. People wanna go and say that I leave every six months, it’s a lie. It just reflects poorly on them, not on me.”
Where do you see Cardano in a year?
On a technical level, Charles said that “In a year, [Cardano will be] fully decentralized, we have smart contracts. We have all those things you know and love, like lots of liquidity, multisig paper wallets, hardware wallets support, delegation where it needs to be. We have some voting stuff built into it. Within a year we’ll have mobile clients as well, so they’ll be running on cell phones.”
Changing the world takes endurance, pain and hard work. Market corrections shake off weak hands and harden the resolve of the truly dedicated to continue the drudgery. Crypto isn’t dead. It’s just getting started.
— Charles Hoskinson (@IOHK_Charles) February 5, 2018
He also explained that the next year is about expanding the usage of Cardano, and taking it beyond Proof-of-Concept: “Next year is all about getting enterprise adoption where it needs to be, the next year’s all about sharding, and getting us from being a system that runs really well with 10,000s to 100,000s, to a system that works well with the millions and the billions…we’ve got a lot of documentation to write, a lot of code to clean up, a lot of partners to bring onboard.”
Charles said that one of the project’s goals is to “get the project done… making it so if I was hit with a bus, Cardano would still be okay, and I can be easily replaced, and so forth.”
“We’ll also be able to–pound-for-pound–compete with Ethereum and Bitcoin. If we get all of that done in a year, then I think that’s mission accomplished.”