Cardano Founder Charles Hoskinson Denies Allegations of Rewriting the Ledger to Steal ₳318 Million

Charles Hoskinson, founder of Cardano, has denied allegations that he hijacked user funds and reorganized the Cardano ledger in 2021 to gain control of 318 million ADA (approximately $619 million at the time).

This claim, widely shared on X by Masato Alexander, suggests the funds were originally allocated during the Cardano ICO (Initial Coin Offering) and later moved using the project’s genesis keys. The funds were allocated to support the Cardano ecosystem and community initiatives.

However, Masato Alexander alleges that during the Cardano “Allegra” hard fork in 2021, a modification in the update removed unredeemed presale UTXOs and transferred their value into Cardano’s reserves.

According to his statement, a function called ‘returnRedeemAddrsToReserves’ in the update was used to filter out ICO-related UTXOs and sweep their balances into reserves. The new ledger state excluded the original holders of those tokens, especially older people from Japan, who had no contact or refund.

After the protocol change, the funds were moved using a type of Cardano transaction known as “MIR” (Move Instantaneous Rewards). These transactions are typically used to distribute staking rewards or allocate treasury funds. In this case, the MIR transaction moved the previously swept 318 million ADA into an account presumably controlled centrally.

Consequently, Masato Alexander claims the transparency is not documented and demands a full accounting of where the funds eventually went and how much was actually used for community or project development.

Charles Hoskinson responded to the claims on X, strongly denying that he or his team hijacked user funds. He stated that the Ada vouchers in question had become unspendable and were moved into a custodial account to continue redemption.

“These funds were not stolen. They were rolled into a custodial account controlled by the TGE that continued distributing the genesis funds to the original buyers for three more years.”

Furthermore, Hoskinson warned Masato Alexander about spreading the claim, stating that legal action would follow if the defamatory statements continued.

“If you continue to imply that IO stole funds, I will sue you. This is my last warning,” wrote Hoskinson on his X (formerly Twitter) account.

Shortly after, Hoskinson confirmed he would proceed with legal action by sending a cease and desist letter to Masato Alexander. However, Masato Alexander continued to assert insider knowledge, stating on x, “Seriously doubt Charles wants to go through discovery. Already know where to look as half his payroll has been talking to me for years.”

A portion of the ADA from reserves funded Intersect, a governance-focused entity connected to the Cardano ecosystem. According to Hoskinson, the total allocation included 350 million ADA, along with an additional 25 million ADA earned through staking.

Intersect’s leadership clarified that the entity only received $7 million in 2024. Jack Briggs, interim executive director of Intersect, confirmed this amount in an X post and pointed to the group’s annual report for further financial details.

This contrasts with a previous statement by Charles Hoskinson, who claimed that Intersect received $50 million from Cardano to support community initiatives.

This discrepancy has led to questions among community members and critics, who are asking for clear records showing the remaining ADA allocations.

Charles Hoskinson has not yet shared a full ledger or audit trail showing the final distribution of the 318 million ADA, despite repeated requests from community members.