Hoskinson Orders Cardano Audit Amid Accusations of $619M Token Misuse

Amid public allegations of a $619 million theft in ADA, Cardano founder Charles Hoskinson has initiated a full-scale independent audit of Input Output Global and the Cardano Foundation.

The audit will involve:

• McDermott, Will & Emery, an independent legal advisor;
• BDO, a top-five global auditing firm with over $15 billion in annual revenue.

Auditors will examine:

• Historical token issuances from 2015 to 2017;
• Internal records and communications from both Input Output Global and the Cardano Foundation;
• Logs from Slack and other messaging services;
• Legal notes and memos;
• Any other relevant documentation.

Transparency hinges on auditing both critical windows. The 2015–2017 phase would shed light on token genesis and voucher issuance. The 2020–2021 period, which includes MIR transactions and the Cardano hard fork, is equally vital. It's unclear whether the second phase will be reviewed, but without it, the investigation risks being incomplete.

Timeline of the Allegations

The first accusation appeared on May 7, with Masato Alexander claiming that Hoskinson:

• Shifted unspent UTXOs to project reserves during the Allegra hard fork (Dec 2020)
• Conducting a MIR transaction in October 2021, which allegedly transferred 318 million ADA into treasury pools. MIRs are a Cardano-specific mechanism for one-off ADA allocations.

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The materials shared included on-chain transactions, chart-based evidence, and emotionally charged wording, which contributed to their rapid propagation across digital platforms. In many instances, media channels reprinted the claims without due diligence. This wave of coverage led to a coordinated information attack targeting Cardano — one of the leading platforms in the blockchain space.

There are claims that Masato Alexander may have used the Cardano controversy to boost visibility for his own project, Akua, built on Ethereum. He allegedly shared the project’s white paper with investors and journalists while continuing to post accusations. Masato, however, denies any opportunism. He insists Akua had been in public discussion for more than three months, well before the May controversy erupted. 

Hoskinson Pushes Back

Cardano founder Charles Hoskinson labeled the accusations as entirely false, emphasizing that they arise from misunderstandings about Cardano’s early token distribution (2015–2017). While 99.8% of ADA was sold, a minor portion remained inaccessible due to the voucher-based issuance in Japan, handled by an outside partner, Attain.

The voucher-based distribution system required users to exchange vouchers for ADA tokens. Regulatory tightening in Japan led the intermediary to terminate operations, leaving some holders unable to redeem their tokens. These tokens remain in segregated addresses, and Hoskinson confirmed they will be resolved in full compliance with Japanese law.

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Hoskinson shared that he had repeatedly called on the Cardano Foundation to speak out and confirm the post-voucher redemption procedure, hoping to defuse rising anxiety in the ecosystem. When the Foundation declined and instead offered him a direct line to its president, Hoskinson felt the lack of a clear public stance enabled the further spread of misinformation.

What Comes Next

All eyes are now on the results of the independent audit, which many expect will reinforce Cardano’s commitment to transparency. The documentation released could serve as a central argument against the rumors and accusations circulating online. Hoskinson has also raised the possibility of a class-action lawsuit against Masato should he persist in spreading unverified claims:

As another reminder, no lawsuit has been filed against us, no voucher buyer has claimed fraud, no regulatory body has made a statement or allegation, and no one has been arrested. Multiple independent organizations and individuals have stepped forward who were directly connected to the sale and publicly stated that there was no fraud or theft.

As the situation unfolded, Hoskinson praised the media organizations that chose not to publish unverified accusations, calling it a sign of professional responsibility. He also committed to doing fully open interviews with any outlet once the audit is complete, taking on all questions without filters. In contrast, outlets that continue to host or defend inaccurate reports will be added to a public blacklist maintained by Cardano.

Blacklisted outlets will be cut off from all collaboration, including sponsorships, partnerships, and interviews — both editorially and personally. Hoskinson stressed that transparency requires shared accountability and a commitment to truth from every participant in the media space.

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