Cardano founder Charles Hoskinson expanded his response to allegations that Input Output Global (IOG) misappropriated over 318 million ADA from unredeemed pre-sale wallets, calling the situation deeply personal and damaging.

In a May 18 post on X, Hoskinson reflected on the reputational toll of the allegations, noting that the incident has reshaped his view of his relationship with the Cardano community.

He added:

“For a decade, I’ve been on the front lines. 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 added that following the release of an external audit, he intends to hand control of his social media account to a media team and scale back his direct engagement.

Legal pushback and audit plans

Hoskinson first responded to the allegations on May 7, saying that IOG may pursue legal action against those accusing him of redirecting unclaimed ADA from Cardano’s 2017 Token Generation Event. 

According to a social media thread by X user Masato Alexander, a December 2020 protocol update introduced a function that reassigned ADA from unredeemed UTxOs to Cardano’s reserves. 

Alexander alleged that the subsequent Move Instantaneous Rewards (MIR) transaction diverted these funds without transparency or notification to the original voucher holders.

Hoskinson countered that investors redeemed 99.8% of ADA vouchers. The remaining 0.2%, recovered under protocol rules after a seven-year window, was donated to Intersect, the Cardano industry coordination body. 

He added that an externally audited report would soon document the redemption history and crowdsale process. Hoskinson also said he would “send letters to the relevant parties demanding retractions and apologies.”

Alexander disputed the claim, citing a public statement by Intersect’s interim executive director that it received only $7 million in 2024, far less than the estimated $600 million value of the disputed ADA. He also criticized the lack of a detailed audit publicly tracing the fund flows.

Foundation and Emurgo address governance process

On May 19, the Cardano Foundation issued a statement distancing itself from the operational aspects of ADA voucher redemption after 2021. The statement added that while it received general updates, it did not provide detailed accounting. 

The foundation stated: 

“The effort to locate and support remaining voucher holders has been led by the IO team over the past four years.”

The foundation welcomed IOG’s pledge to release a third-party audit and recommended that it include all MIR transactions, balances, and any returns generated during fund administration.

Cardano’s commercial arm, Emurgo, also defended IOG’s efforts in a May 19 post. It said the seven-year redemption process involved multiple campaigns, third-party investigations in Japan, and Know Your Customer (KYC) verification.

Emurgo acknowledged:

“While the vast majority of the pre-sale ADA vouchers have been successfully redeemed, there was a small percentage that had gone unredeemed.”

The company added that the Shelley hard fork would have rendered unredeemed ADA unspendable, necessitating their movement to enable further redemptions.

The firm also expressed concern over “excessive, unwarranted FUD,” saying accusations based on limited facts caused unnecessary harm to the ecosystem. It echoed IOG’s call for an audit and urged the community to remain patient.

Mentioned in this article

Ethereum co-founder Vitalik Buterin has submitted a new proposal to make the blockchain network’s nodes more efficient and accessible.

In a May 19 research blog post, Buterin argued that the network’s long-term health depends on users’ ability to run personal nodes, which is becoming increasingly complex due to rising storage and bandwidth requirements.

According to Buterin, Ethereum nodes serve as critical infrastructure for the blockchain. They store transaction data, validate activity, and help maintain decentralization.

However, running a full node has become resource-intensive as the network scales, pushing many users to rely on centralized Remote Procedure Call (RPC) services because:

“The overhead is impractically high, and even after many efficiency improvements it is likely to stay expensive.”

Buterin pointed out that this shift threatens privacy, censorship resistance, and Ethereum’s core principle of decentralization.

Due to this, he emphasized the need to preserve the ability to operate personal nodes while addressing the challenges of Ethereum’s growth.

He said:

“It’s valuable to have a full node so that you can have a local RPC server that you can use to read the chain in a trustless, censorship-resistant and privacy-friendly way.”

Buterin proposed solutions for Ethereum nodes

To ease node operation, Buterin suggested prioritizing Ethereum Improvement Proposal 4444 (EIP-4444). This would limit the amount of historical data a node needs to store to 36 days.

Meanwhile, he recommended a distributed storage solution that fragments and spreads history across the network using erasure coding to ensure older blockchain data remains available.

According to him:

“This ensures the property that ‘a blockchain is forever’ without depending on centralized providers or putting heavy burdens on node operators.”

Buterin further proposed revisiting Ethereum’s gas pricing model. He believes increasing the gas cost for state creation, such as new storage slots, deploying contracts, and sending ETH to inactive accounts, would discourage excessive data storage.

At the same time, reducing execution costs could help ease the burden on the network.

Partially Stateless nodes

Meanwhile, a key highlight of Buterin’s proposal is the introduction of “partially stateless nodes.”

According to him, these nodes would not store the complete Ethereum state but only a subset relevant to the user’s needs.

The Ethereum co-founder added that these nodes would still verify blocks and respond to data requests, but only for the portion of the state they manage. He wrote:

“The node is capable of responding to RPC requests as long as the required data is within that subset of the state; other requests will fail.”

For other data, Buterin said node operators could use cryptographic tools or external services to preserve privacy and choice.

Mentioned in this article

Amid a recent surge in physical threats to crypto investors with substantial holdings, firms that offer personal security services are seeing increasing demand. Amsterdam-based physical security and intelligence services provider Infinite Risks International’s managing director, Jethro Pijlman, told Bloomberg:

“We’ve had more inquiries, more long-term clients, and more proactive requests from crypto investors who don’t want to be caught off guard.”

According to Pijlman, crypto investors are “realizing that intelligent security measures are part of the cost of doing business at this level.”

Growing kidnappings reaffirmed earlier concerns

In 2013, when the price of Bitcoin (BTC) surged, early investors employed an entourage of bodyguards as a display of wealth. But personal security emerged as a necessity as more and more investors became victims of kidnapping and extortion over the last decade.

Concerned investors have been trying to increase security measures since 2018, but they were not yet ready to hire bodyguards. After hardware wallet firm Ledger co-founder David Balland and his wife were kidnapped and held hostage in January this year, crypto elites started hiring bodyguards and beefing up personal security, Wired reported.

Around the globe, over 20 incidents of physical attacks on crypto holders have been documented on a running public ledger kept by Bitcoin security expert Jameson Lopp. The escalating threats have reaffirmed earlier concerns of crypto holders.

Early this month, the father of a crypto entrepreneur was abducted in France. Earlier this week, the video of the failed kidnapping attempt on the daughter and grandson of the CEO of French cryptocurrency platform Paymium struck fear among crypto executives.

The French government promised to increase security for crypto execs in the country in the wake of the recent attacks. This includes priority access to the police emergency line, home visits, and safety guidance and briefings from law enforcement, Politico reported. The decision was taken on Friday after French Interior Minister Bruno Retailleau met with wealthy crypto entrepreneurs on Friday.

Threat to crypto holders is ‘very high’

Perpetrators of the Coinbase hack earlier this week got hold of names, contact details, identity documents, and masked bank and social security information of victims. Coinbase claimed that the data breach, which took place because bribed support staff leaked sensitive information, affected less than 1% of its active monthly users.

However, the fact that hackers can track down the physical location of wealthy crypto executives has raised alarms for investors. A Columbia University professor of computer science and co-founder of blockchain security firm CertiK, Ronghui Gu, told Bloomberg:

“Crypto traders are acutely concerned about their privacy during data leaks. Cryptocurrency can be transferred with just a private key, and is extremely difficult to recover.”

This structure of access to crypto wallets makes traders “prime targets for criminals,” Gu added. This is because bad actors, amid evolving cybersecurity measures making hacks difficult, hope to access crypto by physically endangering the holders. Charles Marino, CEO of the security firm Sentinel, stated:

“Right now, the crypto threat landscape is very high.”

Crypto firms spend millions on the personal security of CEOs

Several crypto entrepreneurs and holders of massive crypto wealth spend millions each year on personal security. The millions poured demonstrate the need for such measures.

Take Coinbase CEO Brian Armstrong, for example. In 2024, the exchange spent $6.2 million on the personal security of Armstrong, overshooting the combined budget allocated by JPMorgan Chase, Goldman Sachs, and Nvidia to ensure the protection of their CEOs.

Similarly, Circle spent $800,000 last year on security for CEO Jeremy Allaire. On the other hand, Robinhood spent $1.6 million on CEO Vlad Tenev.

Infinite Risks International offers clients a range of security services to its clients, including bodyguards, armored vehicle transports, home security, and monitoring of social media to prevent leaks of physical locations. Pijlman said:

“It often takes a close call or a story in the news to prompt action, but once they understand the threat, they want to take it seriously. People are waking up to the fact that their digital success can create very real-world risks.”

Mentioned in this article

---

Roughly 55 million US adults currently own crypto, and a substantial majority of them say digital assets have improved their lives, according to the 2025 State of Crypto Holders Report commissioned by the National Cryptocurrency Association. 

The survey, conducted by The Harris Poll, found that about 21% of the US population owns crypto, and 76% of the holders believe their experience with digital assets has had a positive personal impact.

The poll surveyed 53,805 US adults to identify a representative sample of 10,000 current crypto holders. It is the largest survey to date and reflects a broad demographic range. 

The survey revealed that 67% of holders were under 45 years old, while 15% were over the age of 55, considerably different from a few years ago, when those over the age of 45 were represented in a single-digit percentage.

Meanwhile, gender disparity is also falling, with women accounting for 31% of crypto holders, compared to men accounting for 67% of holders. 

Ownership also grew across all income levels, with households earning less than $75,000 annually now accounting for 26% of crypto-owning households. The report highlighted that the low bar of entry had helped adoption in the lower-income groups.

Beyond investment

The report highlighted that crypto use is not limited to investment. About 39% of holders use it to make purchases, and 96% of those do so at least once a year. Additionally, 31% use crypto to send money to family or friends, and 31% accept it as payment in business transactions. 

Half of all respondents said they were first drawn to crypto by curiosity about the technology, while 60% cited investing in their financial future as the primary motivation for entry.

The report also showed a diversified pattern of holdings. While 11% of holders own over $100,000 in crypto, 55% have portfolios valued under $10,000, and 15% hold less than $500. 

The most commonly known tokens include Bitcoin (99%), Ethereum (91%), and Dogecoin (91%). However, actual usage is concentrated in a smaller group, with Bitcoin held or used by 85% of the respondents, while Ethereum was held or used by 58%.

Regarding societal benefits, 45% of respondents believe crypto promotes financial inclusion and reduces poverty, and the same proportion cited improved digital transaction infrastructure. 

Others pointed to its role in advancing technology (38%) and promoting sustainable financial practices (38%).

Myriad profiles

According to the survey, respondents expressed strong interest in continued education, with 81% saying they want to learn more about digital assets. 

Popular areas of interest include investment strategies (47%), tax implications (39%), blockchain technology (38%), and safety practices (38%). The top sources of information were YouTube and traditional media outlets.

While concerns remain, particularly around scams, volatility, and tax complexities, only 3% of holders reported negative experiences. Out of the 3% negative experiences, about 30% involved fraud or security breaches. 

Meanwhile, 49% of respondents said crypto increased their financial independence, and 45% reported personal growth due to their engagement with the asset class.

Additionally, the majority of respondents view regulation favorably, with 64% supporting government oversight of the sector. 

At the same time, 67% warned that poor regulatory design could stifle innovation, while 73% said they would like to see the US take a global leadership role in crypto development.

The report concluded that US crypto holders view digital assets as personally beneficial and structurally transformative. They express optimism about crypto’s role in financial systems and remain actively engaged in expanding their understanding and participation.

Mentioned in this article