Syscoin Moves Forward

Dear Syscoin Community, Partners, and Supporters,

We would like to take this opportunity to update you on recent developments within the Syscoin Foundation. As many of you are aware, and explained in the recent blogpost , the past few months have seen internal challenges, which we will briefly summarize below.

Recently, the Syscoin Foundation faced an internal dispute involving two of its board members, Bradley Stephenson and Willy Ko. These individuals attempted a hostile takeover of the Foundation, seeking to rebrand it as “Syscoin Red” and implement changes that would have negatively impacted token holders. Their proposals would have diluted token value, and these actions were taken without following the proper governance procedures.

In response, the majority of the Syscoin Foundation leadership acted swiftly to protect the interests of the community. Bradley and Willy were suspended from their positions, and legal proceedings were initiated to formally remove them from the board. This decisive action was necessary to safeguard the integrity of Syscoin, its governance, and the broader community from potential harm.

During this period, Bradley and Willy also made false allegations regarding the misuse of Foundation funds. These claims were aimed at discrediting the remaining three board members and undermining their legitimacy. However, the leadership of Syscoin remains committed to transparency and upholding the trust of our community.

As of today, October 17th, Willy and Bradley have been officially removed from the foundation by court order.

Despite the challenges of the past few months, we remained confident in a positive outcome. Every action we took was always in the best interest of Syscoin, and we are pleased that the court's ruling reflects this. The decision also confirms our accusations that Willy and Bradley were not acting in Syscoin's best interest by establishing Syscoin Red.

Below, we highlight a few key sections of the ruling:

Based on the above, the court is of the opinion that Ko and his associates have neglected their duties as board members. Regarding the plans for Syscoin Red and the publicity surrounding it, they were not primarily guided by the interests of the Foundation — as they initially intended to part ways with it according to the statement made to Decrypt — but by their own interests. It is important to note that Ko and his associates embarked on an entirely independent course with Syscoin Red, without prior consultation with the other board members, or at least without consultation that led to consensus. 

4.7. With regard to Ko, there is also the legitimate criticism that he siphoned off funds from the Foundation to an unknown destination, out of sight of Sidhu and his associates, on the day that Ko and his associates were suspended as board members of the Foundation. It is established that this occurred. Such actions might have been justified if there were strong indications of financial mismanagement by Sidhu and his associates, but the court is of the opinion that there are none. The court will address this further when dealing with the requests of Ko and his associates and Syscoin. This qualifies as improper performance of duties. Ko has also neglected his duties as a board member in this regard.

4.8. The conclusion is that the request from Sidhu and his associates to dismiss Ko and his associates as board members of the Foundation will be granted. 

As anticipated, the court did not find any evidence of mismanagement, as alleged by Willy and Bradley.

The court observes that there are currently no serious indications of (financial) mismanagement or gross neglect of duties on the part of Sidhu and his associates, nor of self-enrichment via SYS Labs. The fact that Ko and his associates did not receive concrete insight into the expenditure of (financial) resources of the Foundation is primarily due to the insufficient oversight they themselves, and Ko as treasurer in particular, maintained over the finances/resources of the Foundation. The refusal of Sidhu and his associates to provide transparency in the last few months, even though they could have shared this with their fellow board members Ko and his associates, can be blamed on them. However, under the circumstances of this case, this does not yet amount to financial mismanagement or gross neglect of duty. The court takes into account the fact that the board at the time had been in a conflict situation, in which Ko and his associates were at fault, at least concerning the Syscoin Red issue. This situation also does not constitute a compelling reason for dismissal/suspension, nor is there any significant change in circumstances that would make the continuation of the directorship of Sidhu and his associates (or one or more of them) intolerable. Therefore, based on the information currently available, the court finds no grounds to proceed with the dismissal and/or suspension of Sidhu and his associates (or one or more of them), and the available information does not justify the appointment of a temporary board member either. 

We regret how this situation unfolded, but we acknowledge the positive contributions Willy and Bradley have made to Syscoin in the course of its history. With this matter now behind us, it’s time to look forward to the future.

In anticipation of a positive outcome, we’ve been hard at work preparing Syscoin for what comes next. We’ve brought on new team members, engrossed ourselves in research and development, and are preparing to share a revised, detailed roadmap to ensure Syscoin’s long-term success. We look forward to soon sharing these new developments with you as we remain optimistic about the new heights we will reach as we continue to drive Syscoin further down the road to success.