Cardano Founder Faces $620M ADA Misappropriation Allegations—Crypto’s ’Ethical’ Darling Under Fire

Charles Hoskinson, founder of Cardano, hits turbulence as explosive claims surface about diverted ADA funds. The $620 million question: genius allocation or creative accounting?

Inside the allegations: Whistleblowers point to irregular treasury movements during Cardano’s 2017-2020 growth phase. Hoskinson’s team calls it ’baseless FUD’—but blockchain forensics don’t lie.

Market impact: ADA wobbles 8% on the news before recovering half its losses—because in crypto, even scandal gets priced in before breakfast. Another day, another nine-figure ’misunderstanding.’

Background: What happened during the allegra hard fork

The Allegra hard fork in December 2020 was part of Cardano’s Shelley upgrade, which introduced features such as token locking and preparation for decentralized governance. In this context, UTxOs that had remained unclaimed since the 2017 ICO were also adjusted.

Masato Alexander claims that a silent transfer of over 300 million ADA occurred within this context. He supports the claim with a 2021 transaction. Hoskinson counters that the transfer was part of automated processes within network development and did not involve personal gain. He described the allegations as “defamation and slander,” which he WOULD pursue with legal action. He further explained that 99.8% of the ADA vouchers issued during the ICO were successfully redeemed.

The remaining 0.2% (approximately 18 to 24 million ADA) went unclaimed after a seven-year redemption period and were ultimately transferred to Intersect, a governance group within Cardano. Hoskinson emphasized that he had no direct access to these tokens. Alexander, however, responded that the explanation was incomplete and did not clarify what happened to the 318 million ADA.

Division within the cardano community

The allegations have led to a split within the Cardano community. Some members are calling for greater transparency and an independent audit of the events surrounding the Allegra hard fork. Others defend Hoskinson’s actions, citing the complexity of the situation at the time, including the bankruptcy of Attain-the company that originally sold the ADA vouchers in Japan.

One party altered the Cardano blockchain to delete and transfer unredeemed ADA vouchers from the ICO, even though such processes in a decentralized network should be decided through a governance procedure-as was the case with the controversial ethereum DAO hack. IOHK and the Cardano Foundation did not immediately respond to inquiries from CVJ.CH.