Ardana Labs, a company that claimed to be creating a stablecoin platform on Cardano, has been accused of losing investors’ money in bad cryptocurrency trades. The company raised $10 million from investors in 2021 but closed down in November 2022, citing funding and project timeline uncertainty. However, evidence from Web3 risk-management platform Xerberus suggests that Ardana executives transferred 80% of the project’s funds to a personal wallet and made a series of bad crypto investments, resulting in a loss of approximately $4 million. The closure of Ardana coincided with the collapse of FTX and the bankruptcy of one of its backers, 3AC. Xerberus analyzed blockchain data and identified questionable money flows, including transfers through centralized exchanges. Approximately $1.82 million was spent on development costs, while $1.4 million remains in the project’s possession. The remaining funds were lost in bad trades on decentralized exchanges. This case serves as a reminder of the risks associated with investing in new Web3 startups without a functioning product.