Key Takeaways:
- Cardano founder Charles Hoskinson, says crypto market fatigue is widespread as retail investor participation in the top 100 coins has dropped over 30% since the 2021 peak.
- He states that the decline is driven by repeated boom-and-bust cycles, high-profile project failures,
- Future growth lies in AI, privacy, and user experience: Platforms that integrate AI-driven economic agents, enhanced privacy features, and next-generation wallets are better positioned to attract and retain users while driving sustainable adoption.
At the Crypto Consensus held in Hong Kong, Charles Hoskinson says the current market has seen retail participation in major cryptocurrencies drop by more than 30% compared with the highs of 2021. Hoskinson attributes this decline to repeated boom-and-bust cycles, speculative excess, and high-profile project failures, including the collapse of notable meme coins and underperforming tokens. He also criticized the growing trend of federation in crypto, where institutional entities and centralized platforms exert influence over key network decisions. According to Hoskinson, this centralization undermines the core principle of decentralization, limits retail participation, and contributes to investor fatigue as smaller participants feel increasingly sidelined in favor of larger players.
He emphasized the growing importance of long-term infrastructure over short-term speculation. With more than 10,000 tokens in circulation today, many lack meaningful adoption or economic utility. Hoskinson argued that the era of chasing 10x returns with minimal underlying value is unsustainable. The narrative that crypto is just a financial product scheme needs to change. It’s the everything product. As such, developers and companies should prioritize systems that create tangible, long-term value, making the technology easy to use and applicable across every sphere of life, including social and political spheres. People should be able to integrate it into everyday apps and systems.
On security, Hoskinson addressed concerns around quantum computing, noting that while these machines could challenge current encryption standards in the next 5 to 10 years, post-quantum cryptography tools already exist. He stressed that careful design and gradual adoption of these solutions will prevent a sudden systemic threat.
Governance remains a critical differentiator between blockchain networks. Hoskinson highlighted that on-chain governance models allow for faster upgrades and more resilient decision-making, often implementing changes 3–5 times faster than networks relying on informal social consensus. This speed, he said, will become increasingly important as blockchain platforms integrate with real-world applications and complex financial systems.
Finally, Hoskinson identified key areas for the next wave of innovation: AI economic agents, programmable privacy features, and next-generation wallet experiences. He envisions these tools combining with robust cryptography to create secure, user-centric platforms. While market speculation has slowed, he believes the crypto ecosystem still offers opportunities for developers and smaller players who focus on practical, infrastructure-driven solutions.
