Cardano Leaders Split With Foundation, Demand Chairman Resigns
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Leading figures have called for a shakeup in the Cardano Foundation. In an open letter published today, Charles Hoskinson, founder of Input Output Hong Kong (IOHK), and Ken Kodama, CEO of Emurgo, called for the Foundation to “voluntarily subject itself to the Swiss authorities” and demanded that its chairman, Michael Parsons, resign.
The nonprofit Cardano Foundation is one of the three independent bodies which have responsibility for development and programming of the Cardano Ecosystem. The other two are IOHK and Emurgo.
In the same open letter, Hoskinson and Kodama outlined plans to expand the scope of their organizations to fill in the gaps in order to fill the Foundation’s role.
Cardano Foundation’s “Lack of Performance”
In a lengthy bulleted list, Hoskinson and Kodama enumerate their “great frustration” at the inactivity and perceived failings of the Cardano Foundation and its officers, as well as their “fruitless attempts” to persuade change from the council and its chairman.
Many of these complaints seem to be that the Foundation is underperforming. “There are no KPIs or public strategy documents,” the open letter says, alleging further that there is no “clear public plan” in the Foundation’s plan or transparency in its funds.
Other accusations are more serious, and seem to hint at a power struggle between the Cardano Foundation and the other leading bodies in the Cardano ecosystem. In a lengthy section of the letter, the writers accuse the Foundation of: “Material misrepresentations and wrongful statements… including a claim that it owned the trademark in Cardano.”
The letter continues:
The council has even tried to assume the power to decide who speaks for the protocol, what should be deployed on the protocol and how the press should represent relationships between Emurgo, IOHK, the Foundation and third party projects.
Having identified the legal dubiousness and profound consequences of the Foundation’s claims in respect of trademark ownership, IOHK ceased collaboration with the Foundation until it published a fair use policy for the trademark. This process took weeks.
IOHK & Emurgo Threaten A Coup
In addition to demanding that the chairman step down and submit the Foundation to Swiss Law, the authors of the open letter included a more radical proposal: stepping in. Because of the alleged failures of the Cardano Foundation to do its job, Hoskinson and Kodama said, their companies “are committed” to taking over its role.
As such, until 2020, the two companies have resolved to take over the functions previously reserved for the Cardano Foundation, including hiring new staff and expanding marketing efforts on behalf of the platform’s community. IOHK has also committed to replacing the Cardano Foundation with a “decentralized Foundation built as a DAO,” whose governance will be conducted directly on the Cardano computation layer.
The Foundation has not yet replied to the open letter, but it’s hard to imagine that it would let such a loud warning shot go without a response.
As one of the most respected spokespeople of the cryptocurrency world, an accusation of this magnitude from Charles Hoskinson is likely to put the Cardano Foundation instantly on the defensive. Depending on how vigorously Mr. Parsons and the Foundation council defend themselves, this could be the first shot of a bigger war ahead.
The author has an investment in Cardano.