Taxes

Hi everyone, this is Charles Hoskinson broadcasting live from warm, sunny Colorado. We have a major milestone in the history of Cardano governance, and it has me really excited. I was talking with some people in government, and they mentioned that the number one topic in government is taxes. Our good friend Andrew Westberg has made a five-minute video, and I want to share my screen real quickly. Here it is; it's a video on his Twitter from Ner.

Andrew is discussing lowering the treasury tax from 20% to 10%. I encourage you to watch it and think about it. I'm not endorsing one way or the other; you guys are in charge, not me. More importantly, this is an example of governance flexing its muscle. It’s a real issue and a real debate, and you’re in charge.

The 20% tax was set to bootstrap and build up a large reserve in the sovereign wealth fund of Cardano. We need to have some adult conversations about not only how to spend it but also if we want to invest it for a return. It's getting to a point where it could potentially generate, if it’s $1.5 billion at a decent rate like 8 to 10% per year, similar to other sovereign wealth funds, that’s around $150 million. Think about it.

Obviously, a lot would have to be done, but you can get liquidity on an amount that high. Anyway, it raises an interesting question: do we need a tax rate as high as it is when we have such a large reserve? And what if ADA goes to $3? We’re not going to spend $450 million per year as an example, so we probably don’t need a tax rate that high. What’s happening is that your government is having a real adult conversation about this right now, trying to figure it out and put these pieces together.

That’s so cool! It gets me all tingly inside to see people having that conversation. It opens up the realization for everyone that not only are you in charge of this, but every single protocol parameter is also under your control. If you want to change something, change it. That is your government at work.

The delegates have an opinion, they broadcast it, socialize it, communicate it, and people debate. You start thinking, “Why are we doing this? Why are we doing that? What should we do in the future?” Anything that can be changed will be changed, and we’ll get there.

I just thought I’d make a quick video to share this with you guys. It gives you a sense of where we’re going and what’s happening. Cardano has a living government, and things are moving forward. We’re very close to the Constitution being ratified; we’re at that 70% threshold. Just a little 5% more—come on, guys, give it a push!

Let’s get it done. Once we reach that, we’ll move from an interim constitutional to a fully elected constitutional committee, 100% completely elected, no interim. More importantly, all these things you get to debate out in the open and talk about openly. How about that? It’s pretty amazing.

Regarding funding projects, do we need to be concerned about market dumps of ADA to convert to USD? Not really. If it’s done in the right way, it has no effect on the market. There’s far more than enough liquidity for the entire annual budget. I’m just happy, guys.

It’s cool, isn’t it? They’re talking about taxes; we’re a real government now because people are complaining about taxes. We’re real! Alright, I’ve got to get to the G show. Cheers, everybody!