Charles Hoskinson suggests that Cardano might introduce a stablecoin offering the same level of privacy as cash. During eToro’s “Conversations with Leaders” podcast on May 9, the Cardano co-founder highlighted privacy-preserving stablecoins as a promising new direction for the crypto sector. “Perhaps people don’t want a stablecoin where every purchase they make is permanently tracked by everyone everywhere, ” Hoskinson explained. Stablecoins represent a $243 billion segment in the crypto market. Although these tokens are privately issued, their transactions can be monitored on the public blockchains they run on, such as Ethereum and Solana. Cardano also hosts stablecoins on its blockchain, with a combined market capitalization of $31. 5 million.

Hoskinson mentioned that the team is already considering becoming the first ecosystem to develop a privacy-focused stablecoin. Privacy coins face regulatory challenges This idea emerges amid growing regulatory pressure against privacy coins. Privacy has been a fundamental principle of crypto for nearly twenty years, yet privacy-focused cryptocurrencies like Monero and Zcash have been delisted and banned from exchanges due to fears they enable illicit activities. The European Union plans to prohibit exchanges and custodians from handling privacy coins beginning July 2027. Nevertheless, Hoskinson believes it is possible to provide privacy without compromising regulatory compliance. For example, the stablecoin could incorporate selective disclosure features to meet anti-money laundering (AML) and anti-terrorism financing regulations that authorities require. Challenges to selective disclosures Several privacy coin projects, including Firo and Zcash, have attempted to adapt their protocols to allow some level of selective disclosure. This involves creating “whitelisted addresses” that users and exchanges can verify for certain transactions, while still supporting shielded transactions. Despite these efforts, regulators remain unconvinced, and without backing from major exchanges, the liquidity for such tokens has diminished. As key markets like the US and Europe move toward clearer cryptocurrency regulations, stablecoins—even in their current straightforward forms—are increasingly scrutinized. In the US, the Genius Act, a recent stablecoin-related bill, failed a Senate vote last week due to Democrats’ concerns that it could jeopardize consumers and the financial system.