EMURGO, one of the founding entities of Cardano, announced its departure from the Pentad governance group after an investigation involving the SecondFi wallet. The decision comes as the company focuses its efforts on the process of recovering the funds lost by users affected by the attack.
The vulnerability in the self-custody wallet resulted in the withdrawal of approximately 16 million ADA, valued at about US$ 2,4 million at the time of the incident. The issue affected 374 digital wallets and led EMURGO to prioritize measures to compensate the affected users.
In a statement released on social media, the company explained that its withdrawal from Pentad is part of a strategy to direct resources toward solving the issue involving SecondFi.
"Our immediate priority is the SecondFi recovery process and we are concentrating our resources where they are most needed," the company said in a post on X. "We believe this is the correct decision for our users and for the ecosystem, and it reflects the standard of responsibility we maintain as a founding entity of Cardano."
Pentad was created as a governance coalition for the Cardano network, bringing together important organizations from the ecosystem, including Input Output Global, Cardano Foundation, Intersect, Midnight Foundation and EMURGO.
The group was structured to coordinate initiatives related to blockchain infrastructure, with financial support directed to projects considered strategic for network development.
The exploited failure in SecondFi was related to the wallet address generation system. After identifying the problem, EMURGO stated that it developed a plan to recover the affected values and that it intended to carry out reimbursements to users within an approximate period of two weeks.
The organization’s departure from Pentad also sparked debates among Cardano community members. Some users questioned the handling of the episode and raised doubts about the company’s continued involvement in funding programs linked to network governance.
In addition, discussions emerged about potential resources received by EMURGO within the Critical Integrations Budget approved in January, although the company did not publicly disclose whether it received amounts directly from that program.
The organization has not yet clarified whether its departure from Pentad will be definitive or temporary, while it maintains its focus on recovering funds related to the SecondFi wallet exploit and on supporting affected users.