- Hoskinson also discussed the latest Partner Chains framework, with Midnight being the first project to leverage the model.
- The Cardano co-founder’s comments are critical to understanding how the industry will challenge the arbitrary crypto regulatory practices across jurisdictions.
As the Cardano [ADA] Summit 2023 concluded in Dubai last week, co-founder Charles Hoskinson sat down to discuss a host of ideas on the “big pey” podcast. He spoke about a range of issues around crypto, including Cardano’s governance model and the Midnight protocol.
The Cardano co-founder listed down three major tasks that the firm aimed to accomplish in the coming years.
The first task is to create a safe and protected protocol with enough guardrails in place that doesn’t destroy everything. The aim is to employ a regulatory function to be “enshrined” in the Cardano system for a robust infrastructure.
The second task is to write Federalist Papers in the Cardano ecosystem, detailing instructions for governance in deterministic code as much as possible. The aim is to define businesses or assets on the blockchain in terms of their relation to the legacy financial world.
This brings forth the third task—connecting whatever is on-chain on Cardano to the legacy world, and creating legal definition of and giving agency to those businesses and assets.
Hoskinson underlined the need to define and describe the property of the different types of assets on Cardano.
How Hoskinson’s proposition tackles regulatory actions across the world
Hoskinson’s comments above are critical to understanding how the crypto industry is trying to develop a global governance and legal infrastructure in the face of a myriad of regulatory actions across the world.
Remember that when the United States Securities and Exchange Commission (SEC) sued Binance [BNB] and Coinbase [COIN] in early June, the regulator included ADA in its newly classified list of securities.
Cardano had vehemently dismissed the SEC’s claim that ADA can be viewed as a security, saying,
“Under no circumstances is ADA a security under U.S. securities laws. It never has been.”
Meanwhile, the European Union is bringing forth the Markets in Crypto-Assets Regulation (MiCA) next year. Many regulators in the Middle East and Asia are accommodating of crypto, but regulations are coming into place with time.
The challenge before the crypto sector is to constantly evolve its strategies in response to different sets of crypto regulation across jurisdictions.
Hoskinson underlined the importance of building a unique global governance system that can be acceptable to authorities across the world. This way, an alternate legal system around the smart contracts ecosystem can be created that will be recognized by institutions from across the world.
The transnational nature of the protocol level governance would challenge the argument that a government is sovereign over cryptocurrency, he added.
Midnight to harness Cardano’s Partner Chains program
Hoskinson also unveiled an exciting new framework called Partner Chains at the Summit. New teams of developers can build partner chains by harnessing the strengths and technologies of Cardano’s core infrastructure.
The first project to leverage this feature will be Midnight, the much-awaited data protection-focused blockchain.
13/ Midnight, a data protection #blockchain platform from IOG that securely safeguards sensitive commercial and personal data, is launching soon on devnet. Stay tuned to learn more about how Midnight will leverage ZK technology.
— Input Output (@InputOutputHK) September 12, 2023
There is a lot of noise among community members about possibly receiving the midnight airdrop. The excitement followed the podcast host teasing about ADA holders receiving the Midnight AirDrop soon.
— big pey (@bigpeyYT) November 4, 2023
Hoskinson further explained in the podcast that the attempt is to wire the entire crypto world together. He believes that it’s no longer about being the greatest layer protocol. Instead, it’s about connecting the crypto ecosystem in the spirit of interoperability.
As more and more users drift to the DeFi space, it will become critical to connect the crypto space with the legacy finance world.
Meanwhile, ADA has been performing extremely well on the charts. Since the bull run began in mid-October, its price has risen by more than 40%. At press time, it was exchanging hands at $0.345.