Xerberus Investigative Report Reveals Mismanagement of Ardana Labs
Xerberus, a UK-based Web3 risk management and platform, has published an investigative report shedding light on the downfall of Ardana Labs, a failed stablecoin platform for the Cardano blockchain. Despite attracting over $10 million in investments at its peak in 2021, Ardana abruptly closed its doors in November 2022, citing funding and project timeline uncertainties. However, Xerberus’ investigation suggests that mismanagement played a significant role in its demise.
Ardana Executives Accused of Misusing Funds
The Xerberus report alleges that Ardana executives, including CEO Ryan Motovu, diverted 80% of the project’s funds into a personal wallet. These funds were then used for poor crypto investments, resulting in approximately $4 million in losses. This revelation raises questions about the integrity and decision-making of the Ardana team.
Evidence of Ethereum Transactions
Xerberus uncovered a trail of Ethereum transactions related to Ardana’s initial coin offering (ICO) in November 2021. Notably, they discovered a $1 million transaction from venture capital firm Three Arrows Capital (3AC) to an address linked to Ardana. This finding suggests potential conflicts of interest or questionable financial practices within the project.
CeFi Exchanges Involved in Fund Flow
Xerberus also found evidence that $4 million of Ardana’s funds were routed through centralized exchanges like Kraken, Coinbase, and Gate.io before reaching the target wallet. Tracking these transactions became challenging due to complex deposit and withdrawal patterns on these exchanges.
Losses Due to Poor Trades on DEXs
The investigation reveals that nearly $4 million of the target wallet’s token balance was lost due to unsuccessful trades on decentralized exchanges (DEXs) such as PancakeSwap, Uniswap, SushiSwap, and GMX. Xerberus observed changes in Ardana’s on-chain behavior in March 2022, with assets being liquidated through DEXs. These liquidations continued until November 2022, aligning with the project’s closure announcement.
Hot Take: Ardana Labs’ Downfall Exposes Mismanagement and Poor Decision-Making
The Xerberus investigative report on Ardana Labs highlights serious concerns about the mismanagement of funds, questionable financial practices, and poor decision-making within the project. The diversion of funds into a personal wallet and subsequent losses from risky investments raise doubts about the integrity and competence of the Ardana team. This case serves as a cautionary tale for investors and emphasizes the importance of thorough due diligence when evaluating crypto projects. It also underscores the need for regulatory oversight to protect investors from such incidents in the future.
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