A partnership between Cardano and Coinfirm, prompted Weiss Crypto to come under heavy criticism. But what had happened?
For Cardano (ADA), the week could hardly have gone better. First, they started with a new all-time high, then ousted BNB from the crypto podium, and to top it all off, the long-awaited “Alonzo” hard fork is just around the corner, which will finally introduce smart contracts to the crypto project. With all the positive news surrounding the Ethereum competitor, one piece of news did cause isolated excitement.
The basis was the announcement of a partnership between Cardano and the blockchain analysis company Coinfirm. In the future, the AML and CFT service of the platform will be used for monitoring purposes within its own network, the project explained in a blog post. This was to comply with international standards of the FATF or also the “6th EU Money Laundering Directive”. Among other things, the regulations lay down guidelines for preventing and combating money laundering and terrorist financing. A necessary step that every cryptocurrency must take on its way to mass adoption, according to the Cardano Foundation’s statement.
“Disappointing, bad step for Cardano”.
However, not everyone shared this opinion. For example, Weiss Crypto – a company that values crypto assets, among other things – published a thread on Twitter over seven pages, where they criticized the cooperation. Summing up, the US firm assessed the Cardano-Coinfirm collaboration as a “disappointing bad move” and began its criticism with a comparison to the banking system, which had been “strangled to death” by excessive regulations. Cardano, he said, as a “free and decentralized network, is now on the verge of being corrupted by “politicization, susceptibility to censorship and manipulation.”
The point of the crypto space, however, is to build a new financial and ecosystem “free from the control and repression of those who have brought our global economy to the brink of total failure,” Weiss Crypto says. The Cardano partnership, however, is now having the exact opposite effect:
This move is now having the exact opposite effect. It is common knowledge that the so-called “AML laws” are enacted by the high priests of the financial world to ensure that nothing escapes them. (…) The financial elites will NEVER accept the crypto industry. Playing by their rules will only mean your demise.
Weiss Crypto on Twitter
Still, he said, adherence to legal frameworks is important. However, these should not be fulfilled by the network itself, but by the individual projects. The base layer must remain neutral and apolitical, the US company stresses. </p>
Cardano Founder Responds
Due to heavy criticism of Cardano, founder Charles Hoskinson felt compelled to respond. In a video message, he defended the partnership. “The purpose of the network has always been to build layers, modules and ecosystems that enable local compliance.”
Further, the Cardano founder opines
While the base layer of the system doesn’t care if you’re from the U.S., China, Japan, or anywhere else, you can add identity and metadata and all sorts of other things, and those other things give you the ability to be compliant with your line of business, regulated or not.
And that’s why these partnerships are so important. They provide clarity and they provide a lot of business and technical requirements. They allow us to make the software better for everyone everywhere and get Cardano more accepted across all industries, regulated or not.
Cardano founder Charles Hoskinson
Weiss Crypto challenges Hoskinson to discourse
general, the response to the thread has been mixed. A large portion of users are backing the Cardano partnership, questioning how global adoption of crypto and blockchain projects will happen if AML or KYC guidelines are not followed. He added that one must also be prepared to make compromises with the traditional financial world, see Binance
Meanwhile, Weiss Crypto also responded to Hoskinson’s response. In it, they thanked him for the feedback and invited the Cardano boss to a discourse via video call. As of press time, Charles Hoskinson has yet to respond to the proposal.