Cardano (ADA) is centralized, says Cyber ​​Capital founder

Justin Bons, a full-time crypto researcher and founder of Cyber ​​Capital, has sparked a debate about Cardano centralization (ADA). In a series of posts on

According to Bons, Cardano’s claim to being the “most decentralized” blockchain is undermined by its reliance on “genesis keys,” a multi-signature mechanism that controls the protocol’s rules.

Cardano Genesis Keys: the point of centralization

In his claim, Bons claims that Cardano is uniquely centralized because these genesis keys allow its parent company Input Output Global (IOG) to exert significant control over the blockchain. IOG reportedly owns five of the seven keys, allowing it to unilaterally change the protocol rules.

This control was strengthened when the Cardano Foundation (CF), one of the key holders, delegated its authority to IOG, effectively giving IOG absolute power over the blockchain. Bons emphasizes that these keys allow code changes to be implemented without a hard fork, meaning IOG could potentially stop the chain, change emission schedules, or censor transactions.

Notably, this mechanism was introduced in the 2020 Shelley update. It is not a featureless leftover from the creation of Cardano, but an active protocol feature. Specifically, blockchains without on-chain governance rely on mechanisms such as Nakamoto consensus, social consensus, or GitHub governance.

However, Cardano’s current reliance on centralized control via Genesis keys sets Cardano apart. Nevertheless, Bons acknowledges that Cardano has worked on on-chain governance as part of its policy Voltaire upgradewhich aims to eliminate these genesis keys.

Charles Hoskinson’s position on Genesis Keys

Charles Hoskinson, the founder of Cardano, has even threatened to leave the project if the Genesis keys are not removed. According to Bons’ assessment, this strengthens the commitment to decentralization. Shelley’s draft papers also clearly indicate the intention to move away from this centralized mechanism.

The Cardano community is known for its strong commitment to decentralization, and Bons applauds its agreement to remove the Genesis keys. He attributes Cardano’s slower pace of development compared to its peers to its academic approach. According to him, this is both a strong point and a point of criticism.

Bons urges users to verify, not just trust, the intentions of IOG and the broader ADA community. He expressed optimism about Cardano’s quest for true decentralization.

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