Charles Hoskinson Ask Staking Ethereum: Similar To Regulated Products

Ethereum staking has been criticized by Cardano founder Charles Hoskinson. (Photo; Doc. Unsplash)

JAKARTA Ethereum has succeeded in transitioning to a new Proof-of-Stake model by the end of 2022. That way Ethereum allows its users to stake or lock ETH into the network to get crypto reward. This staking feature is an alternative to abandoned ETH mining.

However, this received negative comments from the founder of the cryptocurrency Cardano (ADA), Charles Hoskinson. According to him, Ethereum staking is nothing like a regulated product. He made the statement not without reason, the Cardano founder explained because the process involved user assets that were handed over to other parties for profit.

As is known, Charles Hoskinson also co-founded Ethereum at the beginning of his development. However, he chose to leave and decided to set up a Cardano smart contract platform. On February 9 yesterday, Hoskinson expressed his opinion in a Twitter post.

"LOCKing funds, encouraging centralization, and a bad protocol design is detrimental to the entire industry," Charles Hoskinson said.

In this context, Hoskinson responded to Coinbase CEO Brian Armstrong's statement that US regulators of the Securities and Exchange Commission (SEC) plan to ban crypto users access to staking services.

Hoskinson implies that Cardano's approach to staking " makes sense to sustainable proof-of-stake protocols promoting control by many people, not small and creating large decentralized environments."

SEC tightening rules

After the collapse of the leading FTX crypto exchange last November, the US government and related parties including the US Securities and Exchange Commission (SEC) began tightening regulations against the cryptocurrency industry. SEC chairman Gary Gensler stated that crypto exchanges or exchanges that offer staking services are actually no different from borrowing and borrowing systems using different terms.

The SEC chairman's statement reaped the pros and cons among the crypto community. They questioned the SEC's understanding of this crypto staking. Hoskinson considered the SEC chairman to be misunderstood.

"All proofs of the staking protocol may be equated due to a fundamental misconception about the actual [staking] operating and design facts," Hoskinson said, quoted by Cryptoslate.

On the other hand, Hoskinson is also not the first time criticizing Ethereum as mentioned above. Previously, the Cardano founder had described the Ethereum blockchain network as Crypto California Hotel.