The situation at IOTA is not calming down: The self-declared scouts “Hund” has published a hitherto unknown paper from 2018, which is supposed to prove that the board of directors of the IOTA foundation knew to act close to the edge of legality. Facts mentioned in the leaked Memorandum of Understanding (MoU) could actually challenge the non-profit status of the IOTA Foundation.
For a good four months now, the interested cryptoscene has been occupied with the handling of investor funds at IOTA. IOTA co-founder and former board member Sergey Ivancheglo (CFB, Come-from-Beyond) got the ball rolling Early February. It quickly became clear: From the founding days of IOTA and its predecessor companies Jinn Labs and IOTA AS, IOTA, worth millions of US dollars, is still stored in accounts that David Sønstebø, head of the IOTA Foundation, seems to control. In May, an anonymous person, Hund, appeared on the scene to systematically collect information about IOTA’s operations. This “Hund” has now dug up another paper and explains on Twitter what seems piquant about the document.
1) Sergey Ivancheglo has published the Memorandum of Understanding that the Board of Directors of the IOTA Foundation signed five days after the 2018 Board leak.#cleanIOTA #IOTA #Coordicide #IOTAstronghttps://t.co/7geqN6gVtW
— Hund (@Hund_cleanIOTA) June 15, 2020
Does IOTA leadership in a confidential agreement incriminate itself?
In concrete terms, the material that “Hund” is now putting online is a Memorandum of Understanding (MoU) dated August 2018, which should pave the way for Sergey Ivancheglo and Serguei Popov to join the Board of Directors of the IOTA Foundation. At that time, this board consisted of three persons, David Sønstebø, Dominik Schiener and Ralf Rottmann. They probably already suspected that with the IOTA co-founders Ivancheglo and Popov there might be trouble from the past and therefore the MoU was written. In the present version it was also signed by all five and confidentiality was agreed upon. The authenticity of this document has not been doubted so far.
If the MoU is genuine, it proves
- Between IOTA Foundation and IOTA AS money was flowing and the parties knew that some tricks and legal advice would be needed to keep the actions legal.
- The shareholders of IOTA AS (previously Jinn Labs) at that time were Sønstebø and Ivancheglo. Now Sønstebø claims that IOTA AS is his company alone.
- The sale of the IOTA project Qubic from IOTA AS to IOTA smells like a sham deal, the MoU explicitly mentions a possible conflict of interest due to Sønstebø’s dual role.
- The transfers made between the IOTA Foundation and IOTA AS could actually challenge the non-profit status of the IOTA Foundation.
- Confidentiality statements on matters concerning the private lives of Sønstebø and Schiener in the MoU indicate that they were afraid of being blackmailed.
Individual parts of the MoU are blackened, interestingly enough also the table in which it was determined which persons should receive how many IOTA.
If one reads the MoU as a supplement to the already known details from the prehistory of IOTA, one is struck: Dominik Schiener seems to play a more central role than expected. No deal without his cooperation. In order for this to work, a company Schiener & Sønstebø was set up.
“Hund” writes that his new findings were immediately deleted on relevant IOTA forums on Reddit. On Twitter they have not found much of an audience so far, but that may change. Because the MoU, as it now stands, was certainly not intended for the public.
Conclusion: IOTA Foundation should finally show its colours
The recurring allegations about the cash flows at IOTA are damaging the entire project, and most recently early investors intervened with claims for damages.
As for the MoU: The five signatories probably know exactly what was agreed there in 2018, even between the lines. The fronts are relatively clear: Ralf Rottmann withdrew from the IOTA Foundation on April 1, 2019, and has remained silent ever since. Ivancheglo aka CFB resigned from the board a little later in the summer of 2019 and has publicly shot up Sønstebø.
On the other hand, three IOTA founders – Sønstebø, Popov and Schiener – continue to dominate the Foundation, and there is currently only a fourth person on the board – Navin Ramachandran – who did not participate in the MoU. In itself, it should be important for the IOTA Foundation to get off the defensive and create clarity. At one point in the MoU, 81 Ti, IOTA with a current value of around 20 million dollars, is at stake. This questionable sum is also mentioned by the early investors. Sønstebø, Popov and Schiener should know where this money is now stored and what is to be done with it.
But they seem to prefer to sit out the stories, which raises public suspicion of a cover-up and could jeopardise the status of the IOTA Foundation, which is registered in Berlin. By the way, the supervisory board of IOTA remains silent. From the outside, it seems very strange that IOTA has nothing to say officially about the revelations and accusations, and therefore does not contradict them. When will IOTA finally have an external audit from a neutral party?
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