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Cardano founder Charles Hoskinson has expressed strong confidence in the network’s RealFi initiative, arguing that it could significantly expand Cardano’s DeFi ecosystem.
His remarks come shortly after the launch of RealFi’s Phase 1 testnet, which has already attracted strong early participation and fueled community growth.
Hoskinson Explains How RealFi Can Increase Cardano’s TVL
In a statement today, Hoskinson highlighted RealFi’s ability to increase Cardano’s total value locked (TVL), one of the most important metrics for measuring capital deposited across DeFi protocols.
According to him, users who participate in RealFi must deposit assets into the protocol’s smart contracts. Those funds remain locked while generating yield, which the protocol later distributes back to participants.
As more users deposit assets and interact with the platform, Cardano’s TVL naturally grows. In addition, every deposit, withdrawal, and yield distribution generates new on-chain transactions, increasing overall network activity.
“The cool thing about RealFi is that it is gonna be a big TVL and TX generator for Cardano,” Hoskinson said.
A Catalyst for Cardano’s DeFi Expansion
Furthermore, Hoskinson described RealFi as a key pillar of Cardano’s long-term DeFi strategy. He expects it to become one of the network’s most important financial applications since the protocol revolves around yield-generating deposits.
He also argued that initiatives like RealFi will strengthen Cardano’s DeFi ecosystem by attracting more liquidity and expanding the network’s financial infrastructure.
Since users deposit assets into yield-generating smart contracts, the protocol creates additional opportunities to issue and utilize stablecoins within the network. As a result, RealFi could improve liquidity while supporting the broader growth of Cardano’s on-chain financial ecosystem.
Phase 1 Testnet Gains Strong Early Traction
Hoskinson’s optimism follows encouraging progress during RealFi’s Phase 1 testnet.
Earlier, he described the launch as a “wonderful start” after the RealFi team released participation figures from its Pioneer Season. According to the update, more than 1,000 users have joined the testnet, while nearly 500 verified wallets are actively participating in Phase 1. In addition, the project has attracted over 2,000 followers on X and more than 420 new members on its Discord server in just over a week.
The RealFi team emphasized that these numbers represent more than simple user growth. Instead, they reflect rising interest in developing a transparent stablecoin backed by real-world assets.
RealFi Aims to Connect DeFi With the Real Economy
Cardano’s RealFi is designed to connect DeFi with real-world financial services by using blockchain liquidity to support initiatives such as microfinance and small business lending. The project aims to improve financial access for underserved communities while showcasing practical blockchain applications beyond trading.
During its initial testing phase, users can swap test assets for USDr, stake USDr for sUSDr, and later redeem their tokens. Cardano founder Charles Hoskinson said RealFi is progressing toward mainnet launch, which could boost Cardano’s DeFi growth and expand its real-world adoption.
In the meantime, Cardano’s TVL stands at $71.56 million, which is significantly lower than Ethereum’s $41.09 billion and Solana’s $4.91 billion.