Two projects which got their start on the Cardano platform – SundaeSwap and CardStarter – are facing discord over investor issues. In April 2021, a new decentralized exchange CardStarter was announced. The program’s founders then chose to offer incentives to investors to support liquidity on UniSwap for CSWAP tokens. In June 2021, developers announced a deal with a third-party DEX SundaeSwap and promoted it as a merger. Per the new agreement, CardStarter wouldn’twork on its DEX development. It was to offer liquidity to the SundaeSwap DEX.
Investors say that they were promised a lot of benefits in a YouTube meeting for CS WAP holders of the SundaeSwap DEX. Last week, revelations that these benefits were simply a conversion to CardStarter native CARDS from CSWAP. The conversion rate stands at 400:1. Holders who had put in $15 million to support the platform feel that they were shortchanged. According to them, this reward is meaningless. This then started a chain of allegations of the rug being pulled too soon.
Both startups have posted on social media and blame the other for this mess and investor discontent. This, to the disapproval of ADA’s enthusiastic supporters and Cardano’s founder, Charles Hoskinson.
According to Mr. Hoskinson, the June 2021 deal was only a marketing and collaboration deal. The SundaeSwap team did admit to using the wrong terminology when answering user questions. What makes it worse is that the new SundaeSwap DEX has had numerous failed trade reports. Charles Hoskinson said that he was very unhappy with the exchanges between parties and asked them to take responsibility for damaging the ecosystem brand.