Cardano (ADA), the 8th largest cryptocurrency by market capitalisation, is the target of recent controversy stunts. A report by K33 Research has raised scepticism towards Cardano, stirring an ongoing debate within the cryptocurrency community. After a deeper analysis of the K33 Research’s report, one may ask, “Is this a report published in good faith or a mere industry ‘beef’ designed to attack Cardano and manipulate community sentiment?”

A brief overview of Cardano

Co-founded by Charles Hoskinson in 2017, Cardano is a blockchain platform that adopts a research-driven development process. It is an interoperable, scalable, and sustainable blockchain that intends to improve on Ethereum and Bitcoin, earning itself a Crypto 3.0 status.

Cardano also adopts a distributed leadership system that shares its maintenance across three independent organizations; Cardano Foundation, Input Output Hong Kong (IOHK), and Emurgo. Cardano Foundation supervises the upgrading and development of the Cardano blockchain, IOHK engineered the Ouroboros mechanism, while Emurgo ensures Cardano’s continuous adoption by companies and individuals globally.

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Despite its unique features and superiority over its competitors, critics have argued that Cardano is still lagging because of the blockchain’s limited application and adoption. They pointed out that despite the platform’s launch seven years ago, it is still in its “early” development stage and is still yet to prove its real-world use case capabilities.

It is noteworthy that there is no perfect blockchain project and even the biggest blockchain, Bitcoin, has faced massive criticisms. Cardano will not be an exception to this ravaging criticism within the decentralized world of cryptocurrencies. K33 Research’s report encouraging everyone to sell all of their ADA has emerged as the most recent fuss in the community.

What the “report” said

The 2-paged document centred around the uselessness of Cardano and its inability to become big. K33 argued that nothing is happening on the Cardano network beyond exchange transfers and “fake” blockchain activities. The company also noted a lack of significant stablecoin activity on the Cardano network. Pointing that USDC and USDT are not present on the network, K33 opined that the lack of significant DeFi activity on Cardano raises doubts about its competitive capabilities.

Source: K33 Research

Despite being valued at $19 billion, the document emphasized that ADA is living on the past glory of its “peer-reviewed research-driven blockchain network“ branding. A focal point of criticism is the lack of significant use of Cardano and its slow disappearance from the crypto world. According to the document, the market doesn’t kill coins like ADA overnight but bleeds them out till they vanish.

Source: K33 Research

Let’s look into K33 Research

K33 Research is a platform that studies the market structure and gives expert opinions to guide people in the crypto community. Their mission is to give people the confidence to own digital assets, enabling global adoption of blockchain technology. K33 is formerly Arcane Crypto, a collection of entities of which the primary company is a VC shop and investment fund.

Consensys, one of the main driving forces behind Ethereum, is one of their main investors. K33 is also affiliated with Arcario, a VC venture firm whose main investments are in Bitcoin infrastructure and the Lighting Network. It is not surprising to see a company with such a background and affiliations attacking Cardano which is Ethereum’s and Bitcoin’s major competitor.

Source: Twitter

Cardano’s response

In response to K33’s statement, Charles Hoskinson took a dismissive stance, downplaying the credibility of the research firm with a simple “Who? Never heard of them.” This response did not directly refute the specific points raised by the research company, indicating the confidence of Cardano as a strong market force in the crypto community.

This recent critique is not the first time Cardano has faced condemnation. Hoskinson has previously defended the project from claims that it is a “ghost chain”, lacks a working product, and is too decentralized. Other notable criticisms are "Cardano is finished. Charles Hoskinson is a scammer, and the platform is vaporware. ADA never moves."

Despite these challenges, Cardano stands strong as the eighth-largest cryptocurrency with a market capitalization of $17.9 billion. Additionally, it maintains its status as the second-largest crypto asset by staking market capitalization, underscoring its proven relevance in the crypto landscape.

The “report” as a targeted attack on Cardano

Owing to the cryptic background of K33, the statement published by the company raises doubts about the objectivity of the report. In fact, Hoskinson’s dismissive response resonated within the ADA community, with some criticizing K33’s report as a targeted attack on the network.

ADA Whale, a prominent ADA commentator, expressed concerns about the report, stating, “FYI: this is not how a serious research paper reads or looks like.” To further buttress his point, a good report, according to Study.com, should be objective with the aim of guiding people to decide from the discovery. The K33 paper was purposefully subjective and prejudiced, boldly swaying people from Cardano. No wonder the only reaction Hoskinson offered was “Who? Never heard of them.”

Conclusion

While Cardano, like any other successful blockchain project, continuously faces criticism over its perceived lack of significant use case and minimal activity in DeFi, the founders can utilize the statements to improve the network. Their ability to positively respond to criticisms and overcome the resulting market sentiments will determine ADA’s resilience in the competitive crypto market. While stakeholders await developments, Cardano’s evolving narrative is an interesting case study and the cryptocurrency community is anticipating what the future holds for the network.