IOHK and Emurgo break relations with Cardano Foundation
CEO IOHK responsible for the development of a set of basic protocols blockchain project Cardano, Charles Hoskinson and CEO Emurgo, the units agreements and the outsourcing of projects to participate in the ecosystem Cardano, Ken Kodama published an open letter to the community, which has officially announced the severance of relations with the third key structure – Cardano Foundation.
Task Cardano Foundation was the promotion of the Protocol Cardano, raise awareness about it in the community and the solution of various problems of this community.
“For more than two years, the community and ecosystem Cardano felt immense irritation. It was due to low activity Cardano Foundation and its Board of Directors in their assigned duties. Moreover, we did not notice any obvious signs of improvements, despite the many fruitless attempts to reach the Chairman of the company and its Board” – write Hoskinson and Kodama.
They describe in detail the causes and events that preceded the decision to break with Cardano Foundation.
The lack of strategic vision. Foundation does not have key performance indicators (KPI) or the documentation that would have described ways of solving the tasks.
The lack of a clear plan that described how the Foundation would spend its funds for the benefit of the community.
The lack of transparency in the operating activities of the Foundation.
Misrepresentation of the merits and false declarations of the Council of the Foundation, including the claim that he owns the trademark Cardano. Also, the Council tried to dispose of those who must submit a Protocol that should it be developed and how the media should present the relationship between Emurgo, IOHK, Foundation and third parties.
“The unpredictable behaviour of the Board of Directors of the Foundation has caused difficulties. For example, when IOHK went to Ethiopia to sign a Memorandum of understanding with the Ministry of science and technology, the Foundation originally agreed to attend. Suddenly, the Foundation decided to abandon a visit to a week before the event and in a letter to the Director of IOHK in public relations without any reason and prior agreement written, which is the sole custodian of the brand and protocols Cardano”.
The lack of financial transparency. As of October, despite numerous requests Foundation continues to refuse to disclose the addresses at which is stored its share of ADA. Also he does not publish audited financial reports.
Incomplete and poorly diversified the Board of Directors of the Foundation. Over 2 years of existence the number of members of its Board of Directors has reduced from four to two. In fact, since the middle of last year, the Foundation is controlled by its Chairman, Michael Parsons. In addition, the organization is not regulated and does not pass audits, in addition to those required by the laws of Switzerland, where she was.
The lack of a concept of the distribution of millions of dollars transferred to the Foundation, for the benefit of the community Cardano. Instead of engaging in standards development for ICO and STO (offers security tokens) in the context of assets issued on the basis of Cardano, the Foundation launched the program Distributed Futures, the value of which for the record Cardano and ecosystems remains uncertain, the authors of the letter.
Thus, Emurgo and IOHK urge the Council Cardano Foundation voluntarily submit to the Swiss authorities, to conduct a full audit of its financial transactions and key decisions and to submit audit results to the wider public.
“Cardano Foundation is an independent legal education, managed by its own Board of Directors, so the community Cardano, IOHK and Emurgo can’t force its Chairman to resign. However, we can only hope that we will be able to convince Parsons to voluntarily surrender credentials. This would provide regulatory oversight and would allow the Foundation to cease to be an ineffective organization,” the document says.
With his hand IOHK and Emurgo promised to seek personnel who will assume the functions originally assigned to Cardano Foundation. They also noted that the funding attracted by IOHK and Emurgo for a project that remains in their possession and does not depend on Foundation.
Cardano Foundation has not commented on the situation.
Note that this is not the first case when a Swiss-registered financial division causes difficulties cryptocurrency startups. Earlier proceedings between the founders of blockchain project Tezos and Chairman Tezos Foundation became the cause of annual delay in the launch of the main network platform.