The Cardano Foundation’s recent announcement of a partnership with the analytical blockchain company Confirm has been widely criticized by the Weiss Ratings subsidiary of the cryptocurrency rating agency Weiss Crypto.
Did they take the wrong step?
The non-profit Cardano Foundation, one of the three main pillars of building the ecosystem around cryptocurrency Cardano (ADA), announced last week a partnership with Coinfirm, an analytics firm that will analyze data from the Cardano blockchain to check what’s going on. in accordance with the 6th Anti-Money Laundering Directive (AML) and the Financial Action Task Force (FATF) regulations.
“The tools and services provided by Coinfirm allow each exchange, custody service and all other third parties to clearly track the history of the ADA coins they have stored in their wallets.” The Cardano Foundation said in a statement that immediately raised questions about the possible censorship of the cryptocurrency’s transactions.
Among the biggest critics of this move was the aforementioned rating agency Weiss Ratings, which has long described Cardano as the best cryptocurrency project in terms of technology (this is still true today, Polkadot is in second place and Ripple is in third place). The Cardano Foundation’s decision to go in this direction was described as a very bad step.
Bad move all around, disappointing. Here’s why: (THREAD)
– Weiss Crypto (@WeissCrypto) August 25, 2021
“Excessive regulation leads to the banking system suffocating to death. The announcement looks like the ADA is proud to announce that it wants to follow in its footsteps. “ notes Weiss Crypto, who adds that with this step Cardano is approaching “becoming prone to censorship, politicization and manipulated networks.”
The agency also added that any decentralized network that seeks to move towards compliance with regulatory rules is on death.
Response to criticism
Cardano founder Charles Hoskinson, CEO of Input Output (IOHK), the development company working on the project, commented on Weiss Ratings. Hoskinson pointed out that “Cardano’s goal has always been to build layers, modules and ecosystems that allow local regulations to be complied with.” Examples include the cooperation already under way with governments, especially in Ethiopia and Tanzania.
“So while at the base layer, it doesn’t matter if you’re from the US, China, Japan, or anywhere else, what you can do is add identity and metadata and other things that will give you the ability to work in line with your business domain… and that is why partnerships are important. They provide many business and technical requirements and allow us to improve the software for everyone and everywhere. Cardano’s goal is greater adoption in all sectors. The regulated and unregulated ones. “
From the above, it is clear that Cardano wants to be a project that will do well with regulators, and on this blockchain, regulated institutions, perhaps even the states themselves, will be able to build their solutions. At the same time, however, it is clear that Cardano is something completely different from BTC, so we need to look at this project.
The nearest novelty is the bridge with Ethereum
The long-awaited smart contracts should be launched on Cardano as early as September 12. This date remains valid even after the latest updates, which indicates that testing of smart contracts on the Cardano blockchain is going smoothly. On the first day of September, the testnet should become publicly available, which means that 12 days before the sharp launch, virtually anyone who knows the issue can try out smart contracts.
In the meantime, however, the days before the launch of the Cardano ERC-20 converter testnet, which allows tokenizing tokens from the ETH blockchain and using them directly on Cardano, are also counting down. “People will be able to move liquidity or move their tokens to use applications that migrate from ETH to Cardano.” outlined Input Output project manager Francisco Landini.
As part of the testnet, which should be available this week, users will be able to try moving the crypto tokens of the SingularityNET (AGIX) project, which has previously confirmed that it wants to work on Cardano as well. “Users will be able to try migrating their AGIX tokens from ETH to Cardano. And also their return from Cardano back to ETH, “ Landini explained.
Charles Hoskinson said in March that he wanted to migrate at least 100 different projects from ETH to Cardano. The near future will show whether he has exaggerated this issue or will be at least partly close to reality. By launching smart contracts and a bridge to move tokens from ETH to Cardano, Cardano will go leather market. In the coming weeks, he will outline whether it can really prove to be an attractive and better alternative to ETH or will remain with ambitions and expectations.