Charles Hoskinson, the founder of Cardano, is considering the development of a privacy-enabled stablecoin on the Cardano blockchain. In a recent interview on the Conversations with Leaders podcast, Hoskinson revealed potential plans to create a privacy-focused stablecoin. He pointed out that conventional stablecoins have a critical weakness: every transaction is publicly recorded on the blockchain, making them traceable. Hoskinson noted that some users might feel uneasy using traditional stablecoins due to this lack of privacy. Consequently, he proposed the development of a stablecoin that ensures users’ purchases remain confidential. **How Privacy Stablecoins Could Meet Regulatory Requirements** The Cardano founder introduced a concept he called a ‘selective disclosure and season freeze regime’ for stablecoins. This approach aims to let users hide transaction details—such as parties involved and amounts—from the general public. At the same time, regulators would retain the ability to access this information through official channels like regulatory directives or court orders.

This system would preserve users’ privacy without compromising regulatory access. Hoskinson reiterated his endorsement of privacy stablecoins employing selective disclosure, suggesting Cardano could be the first blockchain to launch such a solution. Thanks to Cardano’s privacy-centric sidechain called Midnight, it is well-positioned to introduce a stablecoin that maintains transaction privacy. **Overview of the Stablecoin Market** The stablecoin sector has expanded significantly, currently valued at approximately $245. 61 billion. Leading stablecoins such as USDT and USDC primarily operate on blockchains like Ethereum, Tron, and Solana. Cardano supports several stablecoins, including DJED, USDA, and USDM. According to DeFiLlama data, the combined market capitalization of stablecoins on Cardano stands at $31. 69 million. Presently, transactions involving stablecoins on Cardano, Ethereum, and other blockchains are publicly visible on their respective blockchains. Hoskinson believes the absence of privacy in these transactions might deter some users, prompting his interest in launching a privacy-enabled stablecoin with selective disclosure features. **Regulatory Challenges Around Privacy Stablecoins** Regulators continue to approach privacy-oriented projects like Monero and Zcash with caution. Despite attempts by these projects to balance compliance with privacy, several major exchanges including Binance and OKX have delisted them. Additionally, the European Union has recently banned exchanges and custodial platforms from handling privacy-focused tokens and anonymous wallets effective July 1, 2027.