Charles Hoskinson, the founder of Cardano (ADA), recently revealed that NXT was the cryptocurrency that came closest to surpassing Ethereum (ETH) during its early stages ¹. In an interview with Altcoin Daily, Hoskinson shared his thoughts on NXT, which he believed had the potential to outshine Ethereum between 2013 and 2014 when he was the CEO of Ethereum.

Hoskinson attributed NXT's rapid growth to its user-driven assets and the fact that it was built on Java. He also praised NXT's engaged community and its ability to add features to its product offering. Notably, NXT was already using a proof-of-stake (PoS) consensus algorithm, which is considered more energy-efficient compared to the proof-of-work (PoW) mechanism used by Ethereum at the time. NXT's plans to implement smart contracts on their network further highlighted its potential.

Despite its promising start, NXT ultimately failed to achieve long-term success. Hoskinson believes that NXT's token distribution wasn't well-managed, which contributed to its downfall. However, he emphasized that the more significant issue was NXT's lack of a robust governance system. This led to internal conflicts, causing the team to splinter and pursue other projects. Hoskinson hypothesized that if NXT had a better governance system, it would have become the dominant cryptocurrency, and Ethereum might not have existed.

Hoskinson's experience with NXT has led him to prioritize governance in the development of Cardano. He believes that governance is the key differentiator between successful and unsuccessful projects. Poor governance can lead to a project's demise, as seen in the case of NXT. In contrast, decentralized governance can ensure that decision-making is distributed, making the project more resilient. Cardano is currently on the verge of a significant upgrade, the Chang Hard Fork, which will usher in the "Voltaire" era. This upgrade will introduce decentralized governance, allowing the community to drive decision-making. Hoskinson envisions Voltaire as the most advanced blockchain governance system, enabling Cardano to stand out in the cryptocurrency space. The story of NXT serves as a reminder of the importance of governance in the success of a cryptocurrency project.

Cardano is a public blockchain platform that is open-source and decentralized, with consensus achieved using proof of stake. It can facilitate peer-to-peer transactions with its internal cryptocurrency, ADA. Cardano's development began in 2015, led by Ethereum co-founder Charles Hoskinson. The project is overseen and supervised by the Cardano Foundation based in Zug, Switzerland. When launched in 2017, it was the largest cryptocurrency to use a proof-of-stake blockchain, which is seen as a general alternative to proof-of-work protocols.