Cardano (ADA 5.68%) founder Charles Hoskinson argued this week that his blockchain will overtake Bitcoin (BTC 4.33%) despite Bitcoin's 70% decline over the last 12 months. That claim comes on the heels of Hoskinson taking a break earlier in June after warning of a "wave of failures" of crypto projects in Cardano's ecosystem. He also said that his chain has meaningful advantages over Ethereum (ETH 5.12%), especially in terms of decentralization.
So, what exactly is it that Hoskinson is getting at here, and more importantly, is he right about the future of Cardano?
Hoskinson framed Cardano's edge as stemming from its "verifiable reflexivity," which refers to the chain's ability to generate transactions that carry their own proofs of validity rather than relying on a trusted third party for certification.
His main thrust in raising the issue is that systems featuring verifiable reflexivity can be more readily scaled to larger sizes, especially with regard to transaction throughput, as there's no risk of too much influence becoming centralized in a middleman (which could harm trust in the system's neutrality).
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Separately, Hoskinson argued that Bitcoin handles payments but cannot embed smart contracts at scale, while Ethereum lacks the accounting model for what he calls local-to-global determinism. Cardano's backend, he says, is the only consensus system delivering high throughput, strong security, and decentralization at once, which could make it the future of cryptocurrency.
For Cardano to one-up Bitcoin and Ethereum, Hoskinson claims it'll need to capture some of the market for trust infrastructure, like auditing, post-trade reconciliation, and custody. He cited the Western world spending $120 to $160 billion on those services annually, meaning that Cardano would have a large market to target.
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It's unlikely that Cardano will ever be bigger than Bitcoin or Ethereum, despite most of Hoskinson's characterizations of those chains' shortfalls being accurate.
The first issue is that established bank messaging networks and rival blockchains already run the capital flows he wants Cardano to take, but with far deeper liquidity. Another problem is that the Cardano mainnet currently processes only 10 to 15 transactions per second (TPS); even with its next planned update (called Leios), the first release targets around 1,000 TPS, with further iterations aiming higher. That'd leave it a lot better off than Ethereum, but still lagging far behind speed-and-throughput-oriented chains like Solana, which was already processing 1,625 TPS as of June 22.
Then there's the math problem. For Cardano to match Bitcoin's market cap today, each token would need to trade at roughly $34, a 208x move; it's priced at $0.16 today. That simply won't happen, especially given that Cardano doesn't have much of an edge in any of the areas it's looking to enter.
In short, Hoskinson probably isn't right that Cardano will surpass Bitcoin or Ethereum. The market just doesn't seem to believe that Cardano is the chain that captures verifiable trust at scale, and the evidence supports that skepticism.