Cardano founder Charles Hoskinson has issued a stark warning about the global financial system, arguing that it is a Ponzi scheme headed toward collapse.
He shared this view during a recent livestream. In it, he addressed several crypto-related initiatives and offered a broader assessment of the global financial landscape.
Global Financial System Functions Like a Ponzi Scheme
During the discussion, Hoskinson asserted that the modern financial system operates much like a Ponzi scheme. Rather than relying on genuine economic repayment, he explained, the system survives by continuously shifting liabilities from one sector to another. This creates the illusion of stability while underlying risks continue to grow.
Notably, he highlighted the massive scale of global debt, estimated at around $338 trillion. To him, this extraordinary figure is proof that the system has moved far beyond any realistic path to repayment. He warned that this figure is not only unmanageable today but is also accelerating toward $500 trillion. “No one can ever repay that,” Hoskinson remarked.
According to Hoskinson, debt is no longer treated as a real obligation; it’s used to keep the system appearing stable in the short term. Governments refinance old debts with new ones, central banks pump in liquidity, and financial institutions roll debts forward. These actions hide the system’s fragility.
Interestingly, Hoskinson compares this constant reshuffling to a Ponzi scheme, which only works as long as it keeps expanding, not because it has real value.
Hoskinson Envisions Collapse of Global Financial System
Hoskinson believes this approach only delays, not prevents, a financial collapse. As debt grows faster than global productivity, the system becomes more fragile. He warned that rising debt levels could push the global financial system toward a major crisis, echoing concerns from other experts.
JUST IN: #Cardano $ADA Founder Charles Hoskinson says “we know the global financial system is a Ponzi scheme, $338T of global debt. That is unrepayable, heading to $500T, an astronomically large amount of money that no one can ever repay. We’re headed towards a global collapse.” pic.twitter.com/8Go0DDKNf4
— Angry Crypto Show (@angrycryptoshow) December 18, 2025
In response, some see decentralized systems like blockchain and cryptocurrencies as potential alternatives, offering protection against the growing debt problem.
Can Bitcoin and Crypto Be a Savior?
In June, for instance, financial literacy author Robert Kiyosaki recommended that individuals invest in Bitcoin to build wealth when the global debt bubble eventually bursts.
Similarly, Jim Cramer, host of CNBC’s Mad Money, urged U.S. residents to consider cryptocurrencies as the country’s debt surpasses $37.63 trillion.
In addition, pro-crypto Senator Cynthia Lummis framed Bitcoin ownership at the national level as a potential strategy to address the U.S. debt. She suggested that with 1 million BTC, the U.S. could repay half of its debt over the next 20 years.
Notably, President Donald Trump also shares this sentiment and has already signed an executive order to establish a Strategic Bitcoin Reserve (SBR).