Cardano founder Charles Hoskinson believes that Bitcoin could help unlock the next phase of Cardano’s decentralized finance (DeFi) growth. Despite ranking among the most actively developed blockchains, Cardano still trails far behind competitors like Ethereum and Solana in DeFi liquidity and total value locked (TVL). Hoskinson’s latest remarks suggest that the issue isn’t with technology, but with coordination, governance, and how effectively the community channels its vast user base toward productive use.
A Coordination Problem, Not a Technology Problem
Cardano has earned a strong reputation for its consistent technical progress and deep academic foundation. Yet, the network’s DeFi footprint remains small. As of early November, Cardano’s total value locked was around $271 million — a fraction of Ethereum’s $85.5 billion and Solana’s $11.29 billion.
According to Hoskinson, the numbers don’t reflect a lack of potential but rather a gap in community participation. Cardano has more than 1.3 million active users staking ADA and participating in governance, but most of them aren’t using DeFi applications. That, he says, has created a “chicken and egg” situation: without liquidity, developers and partners stay away, and without more projects and incentives, users remain inactive.
“It’s not a technology problem. It’s not a node problem. It’s not a problem of imagination and creativity. It’s not a problem of execution. We can pretty much do anything,” Hoskinson explained. “It’s a problem of governance, coordination, and ultimately accountability and responsibility.”
His comments underline a growing concern — that Cardano’s impressive technical framework isn’t being fully leveraged because of weak coordination across its ecosystem.
The Plan: Link Cardano with Bitcoin and Real-World Lending
Hoskinson’s proposed solution focuses on creating new liquidity bridges. Rather than competing directly with Ethereum and Solana in the DeFi TVL race, he envisions connecting Cardano with Bitcoin and expanding into real-world lending.
This strategy, anchored by Cardano’s Midnight and RealFi initiatives, would allow Bitcoin and other assets to flow into Cardano’s ecosystem, creating new lending, borrowing, and stablecoin opportunities backed by tangible value.
RealFi, in particular, aims to merge decentralized finance with real-world credit markets. If successful, it could make Cardano a hub for on-chain loans that are tied to off-chain assets and businesses. Hoskinson believes that this approach could unlock billions in capital from both crypto and traditional markets.
The idea is simple — by linking with Bitcoin and expanding into regulated lending, Cardano could attract liquidity and usage beyond its current base, helping it move from passive staking activity toward active financial engagement.
High Development, Low Activation
Despite its slow DeFi traction, Cardano’s developer activity remains among the highest in the industry. Data from Santiment shows that the network’s development index even surpassed Ethereum and Solana in late October, signaling that its builder community continues to innovate at a steady pace.
This points to what Hoskinson calls an “activation problem.” Cardano isn’t short on talent or progress; it’s short on economic activity. The challenge lies in converting technological strength and user participation into a thriving DeFi market.
Developers have been rolling out updates to improve scalability and user experience, while projects like SundaeSwap, Minswap, and Indigo continue to expand liquidity options. However, broader participation from Cardano’s existing users remains limited.
Price Action: ADA Still Under Pressure
At the time of writing, Cardano’s native token ADA trades around $0.60, showing weak momentum. The token remains below its key exponential moving averages — with the 20 EMA near $0.65, the 50 EMA around $0.71, and the 200 EMA near $0.74.
Technical indicators suggest that sellers still control the broader trend. The Relative Strength Index (RSI) remains in neutral-to-weak territory, while the Chaikin Money Flow (CMF) sits slightly below zero, signaling a lack of strong capital inflows.
Unless ADA can regain support above its short-term moving averages, the price could continue drifting sideways. A breakout above $0.70, however, might indicate renewed buying interest, especially if Cardano’s DeFi initiatives start to attract real liquidity.
Why Bitcoin Integration Could Be a Turning Point
Connecting Cardano with Bitcoin could be a game-changer for several reasons. Bitcoin remains the most liquid and trusted digital asset in the world, and integrating its value directly into Cardano’s ecosystem would instantly provide a stronger base of collateral and transaction activity.
Such integration could also bridge two major crypto communities — Bitcoin holders seeking yield opportunities and Cardano users in need of deeper liquidity. If done right, this move might finally give Cardano the missing piece it needs to compete in DeFi.
By enabling Bitcoin-backed lending and stablecoin creation within the Cardano ecosystem, the network could attract institutional interest while giving everyday users new ways to participate in on-chain finance.
The Road Ahead for Cardano
Cardano’s next phase appears focused on collaboration and utility rather than hype. Hoskinson’s emphasis on linking with Bitcoin and expanding into real-world lending shows a more pragmatic approach — one that aims to bridge decentralized innovation with traditional finance.
Still, success will depend on execution. Cardano must not only build the tools but also convince users and liquidity providers to actively use them. That will require better coordination, education, and incentives across the ecosystem.
If the network can solve its activation challenge and turn its development strength into DeFi adoption, it could reclaim a top spot among smart contract platforms.
For now, the foundation is strong, the developers are active, and the vision is expanding. But the real test for Cardano’s DeFi dream will be whether it can turn those ingredients into tangible economic activity — and whether Bitcoin will indeed help unlock that potential.
Post Views: 66