In a recent episode of Crypto Crossfire, which is hosted by crypto influencer Ben Armstrong, a panel of experts engaged in a passionate debate regarding the most pressing threats that Cardano (ADA) faces in the present cryptocurrency landscape. The panel comprised Ben Armstrong, JChains, AJ, and renowned crypto expert Jason Appleton, known as Crypto Crow.
The central focus of their discussion was the imminent challenges confronting the Cardano ecosystem, particularly concerning the impact of Central Bank Digital Currencies (CBDCs) and competition from other cryptocurrency projects.
Is Cardano’s Real Threat CBDC or Other Layer One Blockchain?
To kick off the conversation, JChains emphasized the critical need to thoroughly assess the potential risks that Cardano might encounter, particularly in the context of the approaching bull market. He laid the foundation for AJ to present his initial argument.
AJ initiated the discussion by expressing his profound admiration for the Cardano project and its dedicated community, acknowledging the challenge of critically assessing a project he holds in high regard. He remarked, “It’s a big project with a lot of really passionate community. It’s hard to hate on Cardano,”
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Nonetheless, AJ’s stance was unambiguous: the primary menace to Cardano emerges from other layer-one blockchain projects, with Ethereum emerging as a formidable contender.
He drew a parallel between Ethereum’s supremacy in the blockchain landscape and the industry giant, “Nike,” in the athletic equipment sector. This comparison was rooted in Ethereum’s remarkable valuation, surpassing $188 billion, whereas Cardano’s market cap remains relatively modest at $8.5 billion, placing it in the ninth position within the market hierarchy.
AJ underscored Ethereum’s dominance by highlighting that its valuation surpassed the combined market capitalization of the first 82 cryptocurrencies, excluding stablecoins.
Ben Armstrong Holds a Different View
In contrast, lightheartedly, Ben Armstrong challenged AJ’s assertion that Ethereum posed the most significant threat to Cardano. He playfully suggested that Solana was a more substantial contender.
Armstrong argued that Cardano’s primary vulnerability extended beyond the realm of Proof of Stake (POS) blockchains. He referenced Charles Hoskinson, the founder of Cardano, who appeared unperturbed by other blockchain projects, including Ethereum, XRP, and Solana.
Armstrong insisted that Hoskinson’s chief concerns were centred on potential threats from tech giants such as Google. Moreover, he voiced concerns about the looming peril of Central Bank Digital Currencies (CBDCs), viewing them as a significant menace to Cardano and the entire cryptocurrency ecosystem.
Armstrong expressed profound apprehension regarding the implications of CBDCs on personal freedoms and privacy, drawing from personal experiences to underscore the detrimental effects of financial control systems like CBDCs.
CBDCs Pose No Threat to Cardano
In response to Ben Armstrong’s concerns regarding CBDCs, AJ countered by stating that there was insufficient empirical evidence to substantiate CBDCs posing a specific threat to Cardano. He stressed the absence of concrete data, given the lack of live CBDC implementations, and raised pertinent questions about whether CBDCs would entirely replace stablecoins or coexist alongside them.
Furthermore, AJ reiterated his position that Ethereum represented the most formidable challenge to Cardano, primarily due to its substantial lead in both valuation and adoption. AJ highlighted that to surpass Ethereum in market capitalization, Cardano would need to undergo a monumental 2,100% growth.
Additionally, ongoing legal actions initiated by the U.S. Securities and Exchange Commission (SEC) against major cryptocurrency platforms like Binance and Coinbase could potentially cast a shadow over 19 tokens, including Cardano (ADA). This situation might prompt these projects to consider relocating to alternative international jurisdictions outside the United States.