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Cardano’s founder, Charles Hoskinson, faces serious allegations regarding the mishandling of 318 million ADA tokens during the 2021 Allegra hard fork.
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He asserts that the unclaimed tokens were secured in a custodial account, and an impressive 99.8% of the ICO funds have been redeemed by legitimate token holders.
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In a bold move, Hoskinson warns of legal repercussions for those perpetuating what he labels as false narratives around Cardano’s ICO distribution.
Cardano’s Hoskinson counters allegations of blockchain manipulation over 318 million ADA tokens, asserting high redemption rates for ICO funds.
Cardano’s Hoskinson Accused of Secretly Altering Blockchain to Control ADA Funds
Last week, NFT artist Masato Alexander asserted that the Cardano “Allegra” hard fork involved a deliberate overwriting of unspent token allocations from the original token sale, redirecting those assets to Cardano’s reserves.
“In 2021, the Cardano ‘Allegra’ Hard Fork (HF) wasn’t just a routine upgrade. It contained an extra payload. This HF effectively ERASED the original ICO UTxOs holding the ₳318M and swept the funds into the Cardano reserves,” Alexander stated.
Alexander’s claims extend to an assertion that although there were intentions to reissue the funds to their rightful owners, a substantial portion of the ADA tokens was allegedly withheld.
Further allegations indicate that only a fraction of the tokens contributed to Intersect, a Cardano governance initiative, while most of the funds were staked, purportedly yielding an estimated 25 million ADA in additional rewards.
“Only a tiny fraction went to Intersect… Where did the VAST majority of that ₳318 MILLION actually go after being moved from reserves? Separately, the funds were staked, earning 25m additional,” Alexander claimed.
Additionally, Alexander critiqued the lack of documentation regarding the fund’s movement, hinting at a concerning absence of a verifiable audit trail.
In an ironic twist, Hoskinson had recently emphasized the need for community participation in scaling solutions, pointing to governance’s significance.
“Yet, when ₳318M was at stake, he acted unilaterally via genesis keys to alter the ledger and control these funds,” Alexander remarked.
However, Hoskinson has firmly repudiated these allegations. In a statement on X, he branded the claims as “lies,” clarifying that the ADA vouchers became unspendable following the Allegra hard fork.
The Cardano founder went on to explain that these assets had been placed in a custodial account under the control of the Token Generation Event (TGE), which continued processing token redemptions for three years post-fork.
“The Ada vouchers became unspendable after the hard fork. They were rolled into a custodial account controlled by the TGE that then continued redemption for 3 more years to distribute the genesis funds to the original buyers,” he clarified.
According to Hoskinson, original buyers were able to claim an impressive 99.8% of the ADA distributed during the ICO. He detailed that only 0.2% of the tokens were directed to fund Intersect.
“After seven years, the remaining 0.2 percent were returned to the TGE and donated to Intersect through the same process that funded the Cardano Foundation,” Hoskinson added.
While a comprehensive report from the Cardano team has yet to be made public, Hoskinson underscored that the redemption process continues.
He further indicated that legal action could be forthcoming against Alexander and others continuing to promote the assertion that Input Output Global misappropriated funds.
“We are now considering litigation against those slandering us, and we will make no further statements until the closing report is published. We will then send letters to the relevant parties demanding retractions and apologies,” Hoskinson concluded.
Conclusion
In summary, Charles Hoskinson stands firm against the accusations regarding the alleged manipulation of ADA funds during the Allegra hard fork. The emphasis on transparency and ongoing redemption efforts reflects Cardano’s commitment to its community. As developments unfold, maintaining a clear and factual narrative will be paramount.
