Cardano Founder Denies Claims of ADA Fund Misuse Amid Legal Threats

Tensions have escalated in the Cardano community following serious accusations against its founder, Charles Hoskinson, regarding the alleged mishandling of over 300 million ADA tokens.

The claims, circulating on social media platform X, suggest that a past blockchain upgrade was used to redirect investor funds—an assertion that Hoskinson firmly denies and is now preparing to challenge in court.

The controversy stems from a post by NFT creator Masato Alexander, who alleges that during Cardano’s 2021 Allegra hard fork, unclaimed ADA tokens from the project’s initial coin offering were erased from their original allocations and transferred into network reserves. According to Alexander, most of these tokens were staked for profit, generating millions in additional ADA rewards, while only a small portion was allocated to Cardano’s governance body, Intersect.

Critics of the project claim there is insufficient transparency around these token movements and no audit trail to validate the decisions made. The lack of detailed documentation, they argue, raises questions about internal control and accountability.

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In response, Hoskinson issued a statement refuting the allegations as entirely false. He explained that the affected tokens were part of a redemption process tied to Cardano’s Token Generation Event (TGE) and were inaccessible to users after the fork. He added that 99.8% of the tokens sold during the ICO have since been claimed by original investors, while the remaining 0.2% were eventually allocated to fund Intersect.

Hoskinson has also indicated that legal action is being considered against individuals repeating these claims, warning that defamation suits may follow once the project’s final redemption report is made public.

As the debate unfolds, Cardano’s leadership has opted not to issue further comments until formal documentation is released.

Alexander Stefanov