Charles Hoskinson, founder of Cardano, has publicly voiced his support for the blockchain’s stablecoin ecosystem following major challenges faced by one of its key players. In a recent tweet, Hoskinson addressed the ongoing situation with USDM, a stablecoin project built on that has encountered several setbacks.
USDM CEO Matthew Plomin passed away on November 14, 2024, due to health complications. They even implemented several pre-existing disaster plans for operational needs. Despite the tragedy, Hoskinson’s message conveyed optimism about the project’s resilience and its future prospects.
His comments came in response to news that W3i Software, the company behind USDM, had filed an amendment with the SEC highlighting several material updates to its business status.
The filing disclosed three major changes to the W3i Software. This entails reorganization at the executive level, a 50% reduction in pre-money valuation from $40 million to $20 million, and an investment of $1.5 million from Input Output Global.
According to the February 2025 amendment, Input Output affiliates entered into a nonbinding term sheet with W3i Software for Series A Preferred Stock financing at $1.00 per share. The agreement includes standard preferred stock provisions such as liquidation preference, protective provisions, board representation, and seven-year redemption rights exercisable.
The investment terms also include the option to purchase an additional $500,000 worth of preferred stock at the same ratio in 18 months from closing. W3i Software’s SEC filing acknowledges several risks of building on the Cardano blockchain. The report states: “We are building our products on the Cardano blockchain and rely on its development progress.”
The company clarifies that Cardano’s incomplete roadmap introduces uncertainties to its company, which has the potential to influence its operations. Further, it creates uncertainty about future development, technological innovation, and the timeline of implementation. The public support by Hoskinson for USDM comes at a critical time for the project as it experiences a leadership transition and fiscal reorganization.
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