Cardano’s Hoskinson wants to win over Fortune 500 companies
Comparing countries like Ethiopia to 'China in the 80s,' Charles Hoskinson of IOHK explains Cardano’s Africa strategy and why the Fortune 500 needs crypto.
Fortune 500 companies looking to expand more into developing economies in Africa and the Middle East need a faster and cheaper payment system for local transactions. IOHK and Cardano founder Charles Hoskinson says his company is going to start “pursuing aggressively the Fortune 500” to sell them on Cardano and the ADA coin as the solution.
“A Fortune 500 company needs new tools to be able to get into that market and work with those consumers,” Hoskinson said, in an interview with Forkast.News. “We can facilitate that because we’ve been in those jurisdictions, especially Ethiopia, for example, for over three years.”
Cardano — an open-source public blockchain — is one of the leading candidates on the list of potential “Ethereum killers.” Last summer, Cardano switched to “proof of stake” — something that Ethereum started doing last month. Hoskinson — who was a co-founder of Ethereum before leaving in 2014 and launched Cardano in 2017 — envisions 2021 to be the most productive year in Cardano’s history yet. “If we can keep this momentum and extend it, we’re really going to give Ethereum and the rest of these guys a run for their money,” Hoskinson said.
Developing economies such as Africa’s have been part of Cardano’s strategy since its launch. Prior to the Covid-19 pandemic, the International Monetary Fund (IMF) estimated that the top five of the world’s fastest growing economies would be in Africa. In Ethiopia, one of the countries with the highest potential for economic growth as well as crypto adoption, has a population that is more than 70% under the age of 30.
According to Hoskinson, young Africans are already favoring digital currencies over local currencies. Because of Africa’s fractured economy and underdeveloped banking system, the region is also ripe for DeFi (decentralized finance), Hoskinson said.
“How do you attract the Fortune 500?” Hoskinson asked. “You do it by saying, ‘Hey, would you like access to the 100 million customers on my platform who now have money and would like to consume your products?’”
Not only has Cardano been expanding into Africa in the physical world, it has also been building bridges within the blockchain world, recently unveiling its cooperation with the Litecoin Foundation to achieve interoperability between the two blockchains. Litecoin, a fork of the original Bitcoin blockchain, may provide a gateway for Cardano to build bridges to other blockchains.
“If it works with Litecoin, it’s probably going to work with Bitcoin, or Dash, or any of these other guys,” Hoskinson said.
While Cardano seeks to build a future of interoperable blockchains, Hoskinson explains that cryptography needs to evolve before the emergence of quantum computing and quantum technology, as a breakthrough in mathematics and computation could decrypt encrypted data that safeguard sensitive information.
“You would like to upgrade your cryptography and start using post-quantum crypto — so cryptography that’s immune to quantum computers — as soon as possible,” he said.
In practice, a competent blockchain architect can prevent the threat that quantum computers bring to the blockchain industry, which is fueled by cryptography. Therefore, Hoskinson believes that quantum computing will not threaten the blockchain industry, but instead, cause “huge problems” to internet communications.
“They’re going to cause huge harm to nation states that are trying to preserve secrets,” he said. “Also, Satoshi’s private keys can be broken so people can start signing with Satoshi’s PGP Key, if they wanted to.”
Watch Forkast.News Editor-in-Chief Angie Lau’s full interview with Hoskinson as they dive deep into the world of Cardano, his thoughts on interoperability, his skepticism toward data privacy, plans to court Fortune 500 companies ths year, and more.
Cardano’s ADA, a “third-generation cryptocurrency:“Bitcoi is a victim of its own success. It’s very effective for what it does. But when they say, ‘Hey, let’s get smart contracts on bitcoin,’ or, ‘Hey, let’s upgrade the system so it has more transaction throughput or cheaper transactions,’ it’s damn near impossible to upgrade the system. And so, what you need is a governance layer that allows you to pay for the upgrades you want to do and finance the people who are going to change the system, evolve and grow the system, but then also be able to vote on how changes occur. If you have all three of these properties, we term this a ‘third-generation’ cryptocurrency.”
Cardan’s plans to aggressively pursue Fortune 500 companies: “For Cardano — as far as adoption — we’re just getting started with that…. this is the year that we’re going to start pursuing aggressively the Fortune 500…. In particular, what we’re interested in is when there’s globalization of [the] Fortune 500 into the developing world.
Why privacy-focused services provide false hope: “There are apps like Signal, for example. Elon Musk was recently pushing that. But I think that’s kind of a false hope. You’re encrypting on the wire so the transmission of the information is not problematic. But remember, whenever you send a message to people, it’s not just about your security standards. It’s also about the recipient’s security standards.”
Quantum computing won’t harm blockchain: “I don’t think quantum computers are going to cause much harm to our industry. They’re going to cause huge problems to internet communications. They’re going to cause huge harm to nation-states that are trying to preserve secrets. And certainly a lot of archived encrypted data can be reversed. Also, Satoshi’s private keys can be broken so people can start signing with Satoshi’s PGP key, if they wanted to.”
The importance of interoperability: “You need to inject that information into the system. Okay, so you have to move it around all these different blockchains, you have to move states and foreign information, and then finally, you have value. This is what we usually think of when we talk about sidechains or these other things. And that’s just, basically, say, I have a token living in one system and I want to move it to another system. So now we have Wrapped Bitcoin, or maybe I have a voting token. I’m going to use this and it gives me voting rights in a particular network. So the problem we have in our industry right now is we really haven’t had our WiFi moment. The miracle of WiFi is — it works everywhere.”
The Ethereum co-founder challenges Ethereum: “Now, we’re starting to talk about smart contracts [at Cardano]. We’re starting to talk about a lot more use and utility, above and beyond just metadata and store value count. So this is the age of DApps, the age of DeFi. And it’s going to be really exciting to see Cardano explore that and fight for that… All things considered, I think it’s probably the most productive year we’ve ever had. And I look forward to 2021. If we can keep this momentum and extend it, we’re really going to give Ethereum and the rest of these guys a run for their money.”
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