Apology to Charles (Hoskinson) and r/cc

I made a few sensationalist posts over the past week alleging that Charles was involved with the front-running of Sundae Swap.

In one of the posts, I showed that IOHK’s wallet could be traced to a huge, unstaked wallet that funded another wallet used in the alleged front-running of Sundae. The connection between IOHK’s wallet and the huge, unstaked wallet was made in about a dozen transfers, each with over 25 million ADA transfers with most transfers involving over a billion ADA.

I had said in a previous post that I did not believe this address https://cardanoscan.io/address/addr1q8g77agasft90nnrln487665tf4nz9tt0z9df0l5z637yavnfrlkaatu28n0qzmqh7f2cpksxhpc9jefx3wrl0a2wu8qu5g9nq was an exchange account since it was unstaked and had nearly a billion ADA. My thinking was that if exchanges are willing to screw over customers by withholding withdrawals for a few days to make it to the next reward epoch, then they would not leave a billion unstaked. Based on that and given that this huge, unstaked wallet was tied to IOHK in a dozen large transactions, I made the claim that Charles was involved in the front-running of Sundae.

I apologize to Charles for jumping to that conclusion. I hope that IOHK will confirm that https://cardanoscan.io/address/addr1q8g77agasft90nnrln487665tf4nz9tt0z9df0l5z637yavnfrlkaatu28n0qzmqh7f2cpksxhpc9jefx3wrl0a2wu8qu5g9nq is indeed a Coinbase address. I would ask IOHK to also consider stating whether IOHK funds are being held at this address, as was done in 2017 when IOHK disclosed its original address (https://iohk.io/en/blog/posts/2017/10/17/statement-on-iohks-ada-holdings/). That would explain the transaction path that led from IOHK’s 2017 address to the billion ADA unstaked wallet.

Secondly, I would also like to apologize to anyone who read and engaged with any of the posts I had made. Some of you spent time wrestling with the decision of whether to sell your ADA based on the allegations I made. Some of you spent time debating with me as to whether the transactions were IOHK’s. Some of you spent time correcting my misunderstanding of reading UTXO’s. I’ve fixed the mistakes in the edited post regarding change addresses, but you spent more time than you would have had to if I had just made sure I had understood how to read UTXOs properly before posting what I posted. I apologize for wasting all of your time and causing a scare to those who considered selling.

Whether I end up being correct regarding the transactions being IOHK’s transactions is irrelevant. I made these posts in bad faith and without doing my due diligence. I was not trying to make anything up. When writing the post, I genuinely believed that the transactions listed were IOHK’s/Charles’ transactions and I genuinely believed that large, unstaked address could not have been an exchange wallet. I still believe that the transactions are IOHK’s, and I believe that when IOHK comes out with a statement, then that address will be a Coinbase address with IOHK funds. However, the post was in bad faith. My intention was never to save people from a scam coin or point out some wrong I felt had been committed. It was to reduce people’s trust in Cardano. I had not participated in the SundaeSwap launch, so I was not affected by any front-running or even cared to know who was involved in it. Those of you who called me out on bad faith motivations were correct on that point.

If IOHK confirms that the large, unstaked address is a Coinbase address, then some good may come out of this. If it becomes public knowledge that either Ae2tdPwUPEZ6xYrxCgRDM2NQFM5oajHEoJN3i9ZVV2AbsbvxoJBjVu3yP7W or addr1q8g77agasft90nnrln487665tf4nz9tt0z9df0l5z637yavnfrlkaatu28n0qzmqh7f2cpksxhpc9jefx3wrl0a2wu8qu5g9nq is a Coinbase address, then that allows some victims of scammers to report ADA scams to the authorities and/or Coinbase knowing that this is a Coinbase address. For example, here are some reports of scams with that address: https://forum.cardano.org/t/report-a-youtube-fraud-give-away-scam-video/41265/64?page=4, https://twitter.com/monivong_eth/status/1448744468417441819, and https://np.reddit.com/r/cardano/comments/sp8e96/what_happened_to_my_ada/ (u/zujizu)

If you’re a victim of a scam and you see your money going to the Coinbase address, you’ll now be able to contact Coinbase as well as the FBI’s new crypto unit (https://www.reuters.com/technology/fbi-form-new-digital-currency-unit-justice-dept-taps-new-crypto-czar-2022-02-17/) knowing that Coinbase would be able to KYC the scammers and hopefully get your ADA back.

Also, anyone who was concerned about the Sundae Swap front-running transaction can report it to the SEC knowing that Coinbase would be able to KYC it as well. The transactions to look at are https://cardanoscan.io/transaction/5e495b9d447d180f5748f9c660c71f16ec993e0fd9afbdaef3ce33e357cb85ae and https://cardanoscan.io/transaction/b7418577cb7265c7a986595d57b9ae9b355b4e51dfda400e1bb0732ae6cca48f. The addresses in question are addr1qxu7ja9hduaqllh08qddamckewlhxf06vaansaacgcw864qwq3wh8ycd3n4ulgmjsd7yg99dexmrjn5jvq02zndyl53sgu4pen and addr1qxw876l6pafu63z25muwvzt7fgjf9l7qtfmh4j5dq0v44xhtj5fxf9czefjucs9nkmlyrkuguj0rdll0knagj9wull7qh79w83, with the second one being directly tied to the front-running. If Coinbase owns the address ending in 5g9nq, then they can figure out who sent transfers to either the address ending in u4pen or 79w83. Coinbase isn’t going to investigate this without a formal official inquiry, so if you care about finding out who it is, you’ll have to submit a tip to probably the SEC.

This will be my last post on Cardano. Again, I apologize for wasting everyone's time this past week.

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TLDR: I apologize to Charles and anyone who was scared, angered, or frustrated by my sensationalist posts regarding Charles’ alleged involvement in the front running of Sundae Swap.