- May 21, 2024
- Posted by: admin
- Category: BitCoin, Blockchain, Cryptocurrency, Investments
Justin Bons, the founder and Chief Investment Officer (CIO) of Cyber Capital has called out Cardano, leveling serious accusations against the prominent blockchain and smart contracts platform. To the dismay of ADA holders, Bons alleges that Cardano is highly centralized, casting shadows over the blockchain’s reputation and foundational nature as a decentralized network.
Cardano’s Decentralization Questioned
In an X (formerly Twitter) post, Bons provided a detailed explanation of his centralization allegations against Cardano. The crypto founder disclosed that within the Cardano blockchain are mechanisms called “Genesis Keys,” which can be used to control the blockchain, thus contradicting Cardano’s claims of decentralization.
He explained that these genesis keys are part of a multi-signature arrangement that controls Cardano’s network rules and protocols. According to Bons, if a group gets hold of these keys they can unilaterally exert significant control over Cardano.
The crypto founder went further, accusing Input Output Global (IOG), the technology company behind Cardano, of holding 5 out of the 7 Cardano’s genesis keys. This implies that the IOG currently has majority control over the blockchain, and can potentially change any aspect of Cardano at their discretion and without the consent of the community.
“The IOG could halt the chain, change emission schedules, censor and far more. That is an unprecedented degree of centralized control for an L1 chain; shocking!,” Bons exclaimed.
The crypto founder clarified that the genesis keys were introduced as part of Cardano’s Shelly mainnet upgrade in 2020, emphasizing that they were not present before this time. Initially, the control over these keys was distributed among three key entities including the IOG, Emurgo and the Cardano Foundation. This was to prevent any single entity from having condensed control over the network.
However, a critical shift in the power balance occurred after the Cardano Foundation delegated its control to the IOG. This effectively turned over a significant portion of control to the IOG, grossly reducing the decentralized power of Cardano.
Community To Take Charge Of Cardano Governance
Responding to Bons centralization claims, Jaromir Tesar, a Cardano Delegate Representative (DRep) has provided reassurances about the future governance of the blockchain network. Tesar explained that very soon Cardano’s governance will be transferred to its community, significantly altering the power dynamics within the network.
He revealed that once this transition occurs the genesis keys would lose their functionality while the roles of the IOG, Cardano Foundation and Emurgo would be replaced by the DReps. To further decrease centralization within the blockchain, Tesar disclosed that any ADA holder can become a DRep, thus gaining a portion of influence over the Cardano network and ensuring the governance is not limited to a fixed number of people.
He added that the governance framework will include DReps, the Constitution Committee and the Stake Pool Operators (SPO). These three entities will collaborate to make decisions regarding Cardano’s network governance.
