- The founder of the Cardano blockchain commented on the legal spat between CardStarter and SundaeSwap.
- Hoskinson comments on future upgrades on the Cardano blockchain and predicts the long-term growth of the network.
- Analysts believe there could be a bullish reversal in the Cardano price trend based on historical data.
The CEO of Input Output Hong Kong and founder of the Cardano blockchain, Charles Hoskinson, recently commented on the long-term growth prospects of the network. Hoskinson shared his views on the lawsuit filed by CardStarter – a project accelerator – on SundaeSwap, a Cardano-based DEX.
Hoskinson criticizes lawsuit filed by CardStarter against SundaeSwap
In a recent YouTube video, Charles Hoskinson addressed the legal spat between two projects on the Cardano blockchain, CardStarter and SundaeSwap. Hoskinson shared his thoughts, saying a lawsuit is a “horrendously expensive” and time-consuming way to tackle a disagreement.
CardStarter took SundaeSwap to court over a disagreement on the number of SUNDAE tokens to be set aside, irrespective of a merge between the two projects. After several failed negotiations between the two Cardano-based projects, CardStarter filed a lawsuit.
The founder of the Cardano blockchain believes that builders on the blockchain network should be mindful of disagreements and tackle them before filing a lawsuit, reviewing terms of agreement and scope well ahead.
Hoskinson shared his views on the Cardano blockchain’s next update. The founder of the Ethereum-killer project revealed that a hard fork is unnecessary, given the changes in the planned upgrade.
Input Output Hong Kong(IOHK), the developers behind the Cardano blockchain, recently increased block size by 11%. Based on community feedback, the update failed to impact congestion in the Cardano network significantly.
The Cardano blockchain has several updates lined up for the next four months, ending June 2022. Analysts have evaluated the Cardano price trend and predicted a trend reversal in the altcoin.
Crypto analysts at the YouTube channel Crypto Capital Venture believe that Cardano currently offers one of the best opportunities in the ecosystem. After five consecutive months of posting losses, analysts believe the Cardano price is ready for a trend reversal.
FXStreet analysts have predicted that Cardano price will hit $1.3 soon.
Darren, a healthcare worker from Australia who asked that his last name be kept confidential to protect his privacy, said he lost about $116,000 on CSWAP itself and a further $30,000 to “impermanent loss,” as a provider of liquidity for CARDS-ETH LP, which is the liquidity pool on Uniswap that would eventually be to migrated over to SundaeSwap.
The ongoing drama between two projects built on the Cardano (ADA) blockchain escalated across multiple social media platforms Monday, much to the dismay of the ADA community.
The issues began in April when accelerator program CardStarter announced it would launch its own decentralized exchange or DEX. Shortly thereafter, its founders incentivized investors to provide liquidity for the project on Uniswap in exchange for native CSWAP tokens. The platform’s developers landed an agreement with a third-party DEX called SundaeSwap sometime later, marketing the deal as a “merger” last June. As per the agreement, CardStarter would no longer develop its promised DEX, and would instead provide liquidity to the existing SundaeSwap DEX.
As told by Reddit user “Environmental-Law768”, investors were later promised “great benefits” during a YouTube ask-me-anything session for CSWAP holders in the SundaeSwap DEX. Last week, however, it was revealed that these so-called benefits would simply be a conversion from CSWAP to CardStarter’s native CARDS tokens ($3.14 at time of writing), at a rate of 400:1. Holders who had locked in $15M (at the time of reveal) worth of liquidity on the platform seemed to feel this was a slap in the face, amounting to no meaningful reward for their efforts. Allegations of a rug pull soon followed.
Both SundaeSwap and CardStarter took to social media to place blame over the investor fallout on each other — much to the disapproval of ADA enthusiasts and Cardano founder Charles Hoskinson.
In light of SundaeSwap’s announcement, we share the following documents which we feel speak for themselves.
We will continue to fight for the CSWAP community. pic.twitter.com/6oM2rdcKYF
— CardStarter (@CardStarter) January 24, 2022
According to a SundaeSwap statement cited by Hoskinson, the June deal was purely a marketing and collaboration agreement. However, the SundaeSwap team acknowledged using misguided terms on multiple occasions when communicating with users. To make matters worse, the freshly launched SundaeSwap DEX has already suffered from numerous user reports of failed transactions.
During a YouTube stream Monday afternoon, Cardano founder Hoskinson condemned the heated exchanges between the parties. Hoskinson elaborated it was unacceptable for the fiduciary organizations involved, SundaeSwap and CardStarter, to use Twitter, Reddit, Telegram, and other channels in social media to make their case. “It’s despicable. It doesn’t do anything other than try to abdicate your personal responsibility and damage the brand of the ecosystem as a whole,” said Hoskinson, continuing:
Please, people, get your shit together. Both sides come together, agree to arbitration, talk to each other, and figure out whatever the hell you agree to get done. And if you can’t somehow survive the arbitration process, the courts are always available to you.
Cardstarter and SundaeSwap find themselves embroiled in drama, with each accusing the other of foul play.
Cardano has gone to great lengths to paint itself as a more secure blockchain. For example, in basing its development and optimization on research and formal verification.
But this latest incident highlights that robust protocol is not necessarily a guarantee of security or equitable treatment on any chain.
What’s the deal with Cardstarter?
Cardstarter describes itself as a launchpad and accelerator platform enabling project access for early investors.
In April 2021, Cardstarter announced the launch of Cardswap – a decentralized exchange pitched as the Uniswap of Cardano.
With the announcement came a liquidity mining program where liquidity providers (on Ethereum’s Uniswap) earn $CSWAP tokens, making an attractive proposition for investors keen to get in early with Cardswap.
“$CSWAP tokens imbue holders with voting privileges on proposals governing the CardSwap platform. CARDS-LP along with the Incubator/Accelerator LPs will be automatically migrated to Cardswap pools upon launch…”
According to this Reddit post, the first red flag was when Cardstarter decided to scale back the plans for Cardswap. Rather than operate a standalone DEX, Cardswap would now provide liquidity for SundaeSwap.
This had $CSWAP liquidity providers wondering where they stand. Nonetheless, $CSWAP holders were led to believe the SundaeSwap deal would be “even better” for them.
Last week, the actual benefits were revealed, leading $CSWAP liquidity providers less than impressed.
“The team has 15M dollars of our liquidity now locked with them, and we now find out that our “great benefit” was just to get some more CARDS tokens at a ratio of 400 CSWAP to 1 CARDS – it’s practically a worthless benefit.”
Technically, a rug pull involves the developers abandoning the project, which is not the case with Cardstarter. However, buying $CARDS directly would have been easier and cheaper, making the Reddit poster feel like the whole scheme was “a giant rug pull.”
SundaeSwap responds
Keen to state their side of the story, the weekend saw SundaeSwap try to distance themselves from the situation.
Finally, just to correct any speculation, SundaeSwap and CardStarter entered into a “Marketing and Collaboration Agreement” in June 2021. This was not in any sense a “merger” of the two entities, as explained in our own announcement about the agreement.
— SundaeSwap Labs
(@SundaeSwap) January 22, 2022
Today, a Medium post goes into more detail, stating SundaeSwap is not responsible for how Cardstarter depicted their partnership with investors.
“SundaeSwap cannot control how any other party to an agreement may characterize it to others, including their investors.”
SundaeSwap adds that given the circumstances, they now conclude their agreement with Cardstarter. But, despite “apparent representations” by Cardstarter, SundaeSwap will airdrop 20 million $SUNDAE tokens to $CSWAP holders.
“the SundaeSwap team will provide a cross-chain airdrop of 20,000,000 SUNDAE tokens to holders of CSWAP tokens as of January 20.”
Aatash Amir, Cardstarter CEO, responded to the Medium post by revealing SundaeSwap has reneged on an earlier agreement.
According to Amir, in October 2021, SundaeSwap has agreed to set aside 150 million $SUNDAE tokens for the partnership. But come January 18, this was reduced to just 10 million.
With that, Amir said he will continue to fight for a better deal for the CSWAP community.
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