Charles Hoskinson Wants to Fix Cardano’s $5Bn DeFi Problem

Charles Hoskinson, the founder of Cardano, is sounding the alarm for the network. While the network boasts a healthy 1.3 million active users, decentralized finance (DeFi) activity on Cardano remains thin — far below the scale needed to reach $5-10 billion in TVL.

In his live X stream, he said, “how can we ask Solana and Ethereum users to come and use our DeFi if our own users are not using DeFi. Do they not feel safe? Do they feel experiences are not good enough or the yield isn’t coming?” He also said there can be tonnes of reasons for it and we need a debate on it with these users to try and understand.

However, in a later video, he said “ofcourse that’s not to blame users for the Defi woes. We need a debate with these users to come and solve the problem.” His conviction comes as the network recently released Ourobors Phalanx upgrade to enhance network safety by tackling “grinding attacks”.

BREAKING NEWS:

CHARLES CALLS OUT CARDANO USERS FOR IGNORING CARDANO DEFI 😱😱😱@IOHK_Charles addressed a critical issue on the lack of user participation within Cardano’s DeFi ecosystem.

If our own people used our DeFi protocols, our TVL would be $5–10 billion not $680… pic.twitter.com/1wiKsSUV4Q

— Mintern (@MinswapIntern) November 2, 2025

Cardano’s DeFi Problem

Cardano has millions of active wallets and ~1.3 million staking/governance participants, but only tens of thousands of daily on-chain actors actually using DeFi — and DeFi liquidity (TVL) on Cardano is measured in the low hundreds of millions, not billions.

Low TVL generally means big trades suffer slippage and yields – making the network unattractive for professional market-makers and institutions. That discourages both retail traders and capital allocators from moving funds on-chain.

Cardano does have a large, active community – but most of those users are stakers, holders or governance participants, not DeFi liquidity providers or traders.” – Charles Hoskinson

Converting that base into DeFi users requires deeper stablecoin supply – something that Charles Hoskinson still says “he isn’t about how they’ll help DeFi.” Cardano’s native stablecoin ecosystem is small compared with Ethereum/Tron; bridged USDC/USDT exist but aren’t as deep or trusted, so many users avoid building larger positions in yield or lending markets on Cardano.

As of writing, the network only powers only $37 million of the beyond $300 billion market cap of the stablecoin supply.”

That makes sense about why Charles Hoskinson has recently been making efforts towards RealFi – bringing in dollar liquidity, tokenized real-world assets and BitcoinDefi by Cardinal protocol. Those types of capital are more likely to seed deep, durable liquidity than simply hoping wallets translate into TVL overnight.

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Who leads the DeFi Race

According to DefiLlama, Ethereum leads by a wide margin with roughly $165.7B in on-chain stablecoins. It boasts of about 515,279 24-hour active addresses and about $47.4B in lending TVL — the dollar liquidity that underpins deep DeFi markets.

Solana shows very high on-chain activity too with 2.6M 24-hour active addresses but far less dollar liquidity. It has about $14.3B in stablecoins and $4.0B in lending TVL.

Cardano, by contrast, has almost no stablecoin footprint – at $36.9M and only 26,542 24-hour active addresses, with lending TVL near $76M. These are the numbers that themselves help explain why Cardano’s users aren’t translating into large DeFi flows. Now with Charles Hoskinson’s bid to solve the DeFi woes of Cardano and bring the TVL to 5-10 billion, there are significant network challenges that will require consideration.

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