Cardano rises 13% on fire mechanism rumours, Hoskinson responds
Over the past 7 days, Cardano has been one of the top performers in the crypto top 10 by market cap. Proof-of-Stake networks are leading the market, with Bitcoin and others trailing behind.
Related literature | Cardano (ADA) takes a dive after Hoskinson is accused of falsifying credentials
Avalanche (AVAX) is up nearly 30%, while Ethereum (ETH) is up 16% and Cardano (ADA) 13% over the past week. The price of ADA is trading at $0.89, as of writing, and could see further gains in the near term as the market continues to rally.
ADA’s price showing bullish momentum over the past week. Source: ADAUSDT Tradingview
ADA’s price hike could be fueled by rumors of the possible implementation of a combustion mechanism for Cardano. The news was shared on Twitter by WatcherGuru and sparked a response from the ADA community.
The source of the rumor could be a tweet from Clark Alesna, developer and CEO of a company called SAIB Inc. Alesna accepted a “challenge” from Hoskinson and said he will begin production on a smart burn contract for ADA. Alesna said†
It seems no one really took up Charles Hoskinson’s challenge to build a #Cardano $ADA burn smart contract challenge that he released some time ago. So I’m taking matters into my own hands and started planning and coding this weekend. I will update you soon.
However, the tweet and replies suggest that Alesna was just joking. The report was taken seriously by certain media outlets, prompting a response from Hoskinson himself. Cardano’s inventor shared the following meme in response to these reports.
— Charles Hoskinson (@IOHK_Charles) March 19, 2022
The ADA community seems to agree that a combustion mechanism will never be implemented on Cardano and classified the rumors as “misleading”. Most users seem to agree that this system has disadvantages for the network. A pseudonymous user said:
Misleading information. There will never be layer 1 chain burns. You cannot burn the utxo protocol, just like bitcoin. Token means that layer 2 blockchain on Cardano may need to be burned. Need to get this clear. Why burn? Because they build very differently in terms of accounting model. We won’t talk about it because they are struggling to roll out decentralized proof of stake.
The Cardano ecosystem on fire
Data shared by Hoskinson suggests that the Cardano ecosystem has expanded since the implementation of its smart contract capabilities. As can be seen below, there are more than 500 projects per Hoskinson that build on this network.
Source: @Dr_shwetaPHD via Twitter
Currently, non-replaceable tokens (NFTs) seem to dominate development on this network, and native marketplaces for these digital assets are following on a much smaller scale, with decentralized exchanges (DEX), GamiFi and wallets following.
Related literature | Cardano (ADA) ranks 9th in market valuation during ecosystem influx
He hinted at the continuation of this trend as Cardano was deepest in his third developmental era known as Basho. Hoskinson said: “The chains move. After June, a big wave comes when the Vasil hardfork takes place. This could potentially support the continuation of the current bullish trend for the price of ADA.