Cardano Founder Orders Audit Amid $619M ADA Misappropriation Allegations

Cardano founder Charles Hoskinson has announced that an audit report on the Cardano treasury holdings is in progress, following allegations of misappropriation of approximately $600 million worth of ADA tokens. The allegations, made by nonfungible token artist Masato Alexander, claim that Hoskinson manipulated the ledger using a “genesis key” to rewrite the Cardano ledger and take control of $619 million worth of ADA during the network’s 2021 Allegra hard fork.

Hoskinson has responded to these allegations, stating that a secondary transaction, “Move Instantneous Rewards,” dated Oct. 24, 2021, involved a transfer of over 318 million ADA tokens. This transaction allowed the funds to flow from reserve pools into staking or treasury allocations. Hoskinson also clarified that ADA redemptions remained open for another three years after the transaction, and that the “vast majority of that 350 million ADA was redeemed by the original buyers,” a process that took a total of seven years.

Hoskinson expressed his disappointment with the community’s reaction to the allegations, stating that he is “deeply hurt” by the mistrust. He wrote in a May 18 X post, “To not be given the benefit of the doubt here without strong evidence to the contrary means I don’t have the connection I thought with some people.” Hoskinson also mentioned that after the audit report is released, he plans to turn his X account over to a media team and change the format of his AMAs and X spaces.

Hoskinson, who is also one of the co-founders of Ethereum, is a prominent figure in blockchain development. He recently spoke at Paris Blockchain Week 2025, emphasizing the importance of collaborative economics in the crypto industry to counter growing competition from traditional tech firms entering the blockchain space due to increasing regulatory clarity.