Solana Co-Founder Criticizes Cardano’s Proposal to Convert Treasury to Bitcoin

Controversy Erupts Over Cardano’s Treasury Proposal

Anatoly Yakovenko, the co-founder of Solana Labs, has voiced his disapproval of a recent initiative proposed by Cardano’s leadership, which seeks to convert a portion of its treasury into Bitcoin. In a post on June 16, Yakovenko argued that this move demonstrates poor treasury management and does not instill confidence in the Cardano community.

He emphasized that cryptocurrency projects should maintain a runway of 18 to 36 months in short-term treasury bills, rather than making significant diversions like this one.

Cardano’s Leadership Defends Their Strategy

The debate arose after Cardano founder Charles Hoskinson suggested reallocating $100 million of ADA—the network’s native token—toward Bitcoin and stablecoins. Hoskinson believes this shift aims to bolster Cardano’s decentralized finance (DeFi) capabilities and address existing challenges in its stablecoin market.

Critics, however, perceive this action as indicative of a lack of faith in the ADA token’s potential, with trader Aaron Dishner commenting that it may appear as if Cardano is conceding that Bitcoin holds greater value.

Yakovenko supported these critiques, questioning why any protocol would need to manage Bitcoin for users when individuals can purchase it on their own.

Mixed Reactions Within the Cardano Community

The proposal has sparked a divide among Cardano supporters, with concerns raised over the potential impact of a $100 million sell-off of ADA on its market price. In response, Hoskinson asserted that the ADA market is sufficiently robust to handle such a transaction without causing a significant downturn.

He further defended the initiative as a necessary move to enhance Cardano’s position within the DeFi sector, particularly concerning liquidity and stablecoin integration. Addressing the current landscape, he noted that merely $33 million in stablecoins are presently utilized within Cardano, a figure that he believes jeopardizes the network’s future viability.

Hoskinson Stands Firm Amid Criticism

Despite the backlash, Hoskinson remained resolute, arguing that criticism alone would not address the fundamental issues at hand. He stated, “We have a means to fix it. Name-calling or insults will not alter the objective reality.”

Looking ahead, Hoskinson confirmed plans to present a formal proposal regarding this strategy at Rare Evo, an annual event dedicated to discussions about the Cardano blockchain, indicating a commitment to making constructive changes within the ecosystem.