Cardano’s founder, Charles Hoskinson, has cautioned that the United States could be heading toward a recession if multiple global pressures collide at the same time.
In a recent discussion, Hoskinson explained that a possible collapse of the artificial intelligence boom, along with key U.S. allies redirecting trade and investment toward China, could place serious strain on the American economy. He warned that extended economic separation from major partners would reduce U.S. consumption and could turn into a major economic crisis without swift policy responses.
🔸 Key Factors That Could Push the U.S. Toward Recession
While responding to questions about the likelihood and timing of a recession, Hoskinson outlined a domino effect driven by geopolitical and financial stress. According to him, shifting global alliances could weaken foreign direct investment flowing into the United States.
He highlighted growing economic cooperation with China among traditional Western partners, pointing to new trade agreements and increased diplomatic engagement involving countries like Canada and the United Kingdom. These developments, he said, signal a slow but meaningful change in global trade patterns.
Hoskinson also mentioned the risk of an AI-sector bubble bursting, along with rising retaliatory tariffs across Europe, as additional threats that could accelerate an economic slowdown in the U.S.
🔸 Timeframe and Economic Impact
Hoskinson suggested that if the U.S. were to lose a large portion of its trading partners over the next three to five years, domestic consumption would take a direct hit. Since consumer spending is the backbone of the U.S. economy, he argued that losing even half of its trading relationships would have serious consequences.
He emphasized that without intervention, these pressures could make a recession unavoidable. However, he also noted that timely and decisive government policies could still reduce the risk and stabilize the economy.
🔸 Recession Concerns Continue to Grow
As trade conflicts intensify globally, concerns over a potential U.S. recession are increasing. In March 2025, Goldman Sachs raised its recession outlook, estimating a 35% probability of a U.S. economic downturn within the following year, largely due to escalating trade disputes.
