- Charles Hoskinson believes Cardano’s billion-dollar treasury shouldn’t just sit idle anymore; it’s time to put that capital to work.
- He’s proposing a strategy similar to sovereign wealth funds used by countries like Norway and the UAE.
Last week, we reported that Charles Hoskinson made an interesting take on what Cardano (ADA) should do with its treasury. He suggested that instead of just sitting on all that ADA, about 1.7 billion worth, they could take a chunk of it, around $100 million, and swap it into stablecoins like USDM, USDA, iUSD, and some Bitcoin (BTC).
In a recent conversation with David Gokhshtein, Charles Hoskinson put things plainly: “If we’ve got a billion dollars in buying power, why not put it to work?” He pointed out that if people keep saying Cardano’s DeFi space needs more total value locked (TVL), more users, more yield-generating products, and more activity, then earning yield on that treasury makes sense. “It’s so simple,” he said.
A Wealth Fund that Grows Itself
As outlined in our recent news brief, Charles Hoskinson’s plan is to reshape Cardano’s financial backbone, starting with what he calls a “stablecoin drought.” The Cardano treasury holds roughly $1.7 billion worth of ADA, but only $30–33 million in stablecoins, an imbalance that he says is holding back DeFi development on the network. When we compare this to Ethereum (ETH) and Solana (SOL), Cardano trails behind in stablecoin-to-TVL ratios by 190% and 110% respectively.
According to DeFiLlama, ADA’s TVL recently spiked to $433.93 million, up over 71% in just 24 hours, but stablecoins still account for just $31.64 million of that. For context, Ethereum has a stablecoin market capitalization of $125 billion with a TVL of $61 billion. Solana has $10.45 billion in stablecoins and $8 billion locked in DeFi protocols.
To address this gap, Hoskinson is proposing much more than a token swap. He’s pushing for a sovereign wealth fund-style model, where a fraction of ADA is converted into stablecoins and Bitcoin, generating annual yields of 5–10%. These returns would then be reinvested into buying back ADA, feeding the treasury in a self-sustaining cycle. If done right, Hoskinson estimates this could generate between $5 million and $10 million in annual yield.
The goal? To inject the liquidity DeFi builders need today while laying the groundwork for long-term, yield-driven stability. Another component of his proposal is governance. He suggested forming a board made up of trusted community members who would oversee the fund, make decisions, and ensure transparent, responsible management.
Of course, not everyone is on board. Some community members worry that locking up ADA in yield strategies might delay the kind of explosive price moves they’re hoping for. But for others, this is a shift toward long-term stability, for Cardano as it competes with the likes of Ethereum.
Charles Hoskinson recently confirmed that Bitcoin is officially live on the Lace wallet, following a successful audit. We noted in our earlier update that it’s just another sign that Cardano is serious about branching out and becoming a real player in the DeFi space. Back in late 2024, Hoskinson said Bitcoin DeFi was coming, and the team’s been making good on that promise.
As for the market, ADA has had a bumpy ride lately. The token is trading at around $0.55, down 2.6% in the last 24 hours, with trading volume also slipping by more than 20%. Still, zoom out a bit, and ADA’s up 46% over the past year.
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