- Whale loses $6 million swapping 14.4 million ADA for USDA due to liquidity pool slippage.
- Hoskinson states Cardano Foundation, not IOG, responsible for bringing stablecoins to network.
- Cardano’s total stablecoin market cap stands at $37.8 million compared to Tether’s dominance.
Cardano founder Charles Hoskinson has addressed criticism about his reluctance to attract top-tier stablecoins to the blockchain. Tensions escalated within the Cardano community after an unidentified whale lost more than $6 million while exchanging ADA for a stablecoin.
A wallet that had been dormant for five years became active and swapped 14.4 million ADA for US Dollar Anzens, a Cardano-based stablecoin. However, instead of receiving the expected $6.9 million worth of USDA, the trader obtained just 847,696 USDA, resulting in an approximately $6.05 million loss.
Liquidity constraints cause massive slippage
Multiple sources attributed the incident to the user interacting with an illiquid liquidity pool and selecting a lesser-known stablecoin, which caused severe slippage during the swap. Cardano community members expressed mixed reactions to the development.
Some users blamed the trader for overlooking clear indicators that the swap would return far less value. Others directed frustration at Hoskinson. An X user accused him of only reacting after problems occur and demanded to know why he has yet to launch the stablecoin the community has been requesting.
Hoskinson responded emphatically that he is not responsible for bringing stablecoins to Cardano. He posted the statement dozens of times consecutively, clarifying that launching stablecoins on Cardano is not his responsibility.
While Hoskinson and his company IOG originally designed and built the network, Cardano has evolved into an ecosystem where independent teams can develop products including stablecoins. Currently, Cardano’s stablecoin market remains relatively small, with total market value around $37.8 million. This represents only a fraction compared to industry leaders like Tether’s USDT.
Foundation holds responsibility and resources
Responding to users questioning who holds responsibility, Hoskinson clarified the task falls to the Cardano Foundation. He noted that the Swiss-based nonprofit was allocated 600 million ADA, worth roughly $280.98 million, to bring stablecoins to the network.
Despite stressing it is not his obligation, Hoskinson’s IOG previously partnered with COTI to launch the Djed stablecoin. However, adoption fell short of expectations, and the token currently maintains a market cap of just $3.82 million.
Hoskinson has also attempted to attract major stablecoin issuers to Cardano. He has held discussions with Ripple executives about bringing RLUSD, which recently surpassed $1 billion valuation, to the Cardano ecosystem. While discussions continue, no official launch date has been announced.