Hoskinson: Cardano Needs an Executive Function to Drive Ecosystem Growth

The Cardano co-founder outlined the proposal during a new Markets Outlook interview, arguing that the network’s governance system must now extend beyond protocol upgrades and treasury decisions.

Hoskinson said the executive function should coordinate marketing, commercialization and ecosystem growth while operating under defined limits and community oversight. His comments followed the activation of the van Rossem hard fork, the first Cardano protocol upgrade to complete the full proposal, approval, ratification and activation process through decentralized governance.

van Rossem Shifts Cardano Governance Toward Coordination

The van Rossem hard fork moved Cardano to Protocol Version 11 and introduced improvements across Plutus functionality, ledger consistency, security and cryptographic infrastructure.

According to Intersect’s technical overview, the upgrade remained within the Conway ledger era and did not change the structure of Cardano transactions. The intra-era format allowed new functionality and protocol fixes to be activated without the integration burden of a complete ledger-era transition.

Hoskinson said the new cryptographic capabilities expand Cardano’s ability to verify Groth16 proofs, supporting future work on bridges, zero-knowledge systems and cross-chain interoperability. He also connected the upgrade with preparations for Ouroboros Leios, Cardano’s proposed Layer 1 scaling protocol.

The hard fork formed part of a longer governance transition. Cardano moved from federated block production during the Byron era to decentralized block production under Shelley, followed by smart contracts, an on-chain treasury and community-controlled protocol upgrades.

Hoskinson described van Rossem as an example of “recursive self-improvement,” in which the network can establish priorities, finance development, approve protocol changes and activate them without Input Output retaining final authority.

Responsibility for Cardano’s core software is also being distributed among a wider group of development teams. Hoskinson cited Project Blueprint, which is producing implementation-independent specifications in Agda, alongside alternative Cardano node implementations being developed in Rust, Go and JavaScript. The existing Haskell node is expected to move gradually toward a federated open-source development model.

After decentralizing block production, protocol voting and a growing share of software development, Hoskinson identified an executive function as the remaining major governance component.

He did not present a formal proposal defining its membership, powers or selection process. He said, however, that the structure would require checks and balances preventing it from becoming a permanent central authority.

Cardano Narrative Reset Targets DeFi, Interoperability and Users

Hoskinson said Cardano has already demonstrated its ability to design and maintain complex blockchain infrastructure. He identified growth in users, DeFi liquidity, transaction volume and cross-chain cooperation as the network’s next objectives.

Reaching those targets would require organizations capable of negotiating agreements, coordinating ecosystem resources and measuring results. Hoskinson credited the Pentad structure with advancing initiatives involving Circle, USDCx, LayerZero and Pyth during the past year.

The $USDCX initiative is intended to expand access to dollar liquidity on Cardano, while LayerZero and Pyth would provide broader interoperability and market data infrastructure. Hoskinson presented these projects as early examples of the coordination that a permanent executive function could provide.

Under the model he described, Cardano would establish measurable targets for total value locked, transaction volume, DeFi liquidity and user adoption. Partnership and marketing programs could then be evaluated against those targets.

Hoskinson also cited AlphaGrowth and Draper Dragon as potential contributors to this phase. AlphaGrowth is behind Cardano PRIME, a treasury proposal focused on increasing qualified DeFi liquidity and on-chain activity. Draper Dragon established the Orion Fund to invest in Cardano companies and connect ecosystem projects with external capital and commercial support.

He described the broader strategy as a Cardano “narrative reset.” Cardano’s public perception, he argued, remains influenced by its rise to third place on CoinMarketCap in 2021, its failure to overtake Ethereum and Solana’s subsequent lead in DeFi activity.

Hoskinson identified Bitcoin DeFi, RealFi, Midnight and partner chains as potential differentiators.

For Bitcoin DeFi, he outlined a structure in which Bitcoin could be used on Cardano without relying on a conventional custodial bridge. Cardano’s extended UTxO architecture could preserve properties of Bitcoin’s UTxO model, while Midnight could add privacy and abstraction for lending and other financial applications.

RealFi is designed to connect Cardano liquidity and stablecoins with real-world credit, including microfinance loans in emerging markets. Hoskinson projected that the platform could add several billion dollars in TVL to Cardano over the next several years. The figure represents his forward-looking estimate rather than liquidity already deployed on-chain.

Partner chains form another part of the strategy. Hoskinson described a model in which token distributions from connected networks could supplement the economics available to Cardano holders and stakers. Midnight’s $NIGHT token was presented as the first large-scale example of a partner chain returning value to the wider Cardano ecosystem.

He contrasted that model with Ethereum Layer 2 networks, which he called “parasitic” because he believes they can move activity and economic value away from the base layer. Cardano’s partner-chain model is intended to align connected networks with Cardano’s staking and governance system.

Cardano and Ethereum Follow Different Governance Models

Hoskinson’s criticism of Ethereum focused primarily on its governance and funding structure. He argued that Ethereum has made strategic errors by operating without a protocol-level on-chain treasury or a direct governance mechanism through which token holders determine network priorities.

Cardano directs part of its monetary expansion and transaction fees into an on-chain treasury. Funds can be released only after governance approval, creating a protocol-level mechanism for financing development, infrastructure and ecosystem programs.

Ethereum follows a different model. Its official governance documentation states that protocol decisions are made through an off-chain process involving EIP authors, core developers, node operators, validators, application teams and users. Ethereum does not use a single token-weighted vote that automatically determines which protocol changes are adopted.

The Ethereum Foundation also manages its own assets under a separate Treasury Policy. Its treasury supports the Foundation and ecosystem programs, but it is not a protocol-level fund controlled through on-chain voting by Ethereum holders.

Hoskinson argued that relying on foundations, major companies and voluntary funding can give the largest financial contributors disproportionate influence over technical priorities. Ethereum’s model avoids direct token-weighted governance and instead relies on social consensus among multiple stakeholder groups.

He extended his criticism to Ethereum’s history of changing development strategies, including Plasma, Casper, sharding and Layer 2 scaling. Hoskinson argued that Cardano has spent years developing UTxO-based architecture, formal specifications, liquid staking and on-chain governance systems that Ethereum is now reconsidering through different technical approaches.

The executive function described in the interview would not expand Input

Output’s authority. Any formal proposal would need to define who may coordinate ecosystem growth, which decisions that body may make, how its performance is measured and how Cardano governance can replace it.

The van Rossem hard fork demonstrated that Cardano’s governance system can authorize and activate a protocol upgrade. An executive structure would move the next governance test from approving code to assigning limited authority over partnerships, distribution and commercial growth, including the process through which that authority can be withdrawn.