Ondo Faces Governance Dispute After Founder's Sudden Death

Author | Azuma (@azuma_eth)

With the U.S. Securities and Exchange Commission (SEC) officially issuing relevant exemption guidelines, asset tokenization has become the most prominent theme in the current cryptocurrency recovery.

Over the past few years, an increasing number of traditional financial assets—from U.S. Treasuries and funds to stocks—have been brought onto the blockchain, and Ondo, with its earlier strategic positioning and faster execution, quickly established itself as the market leader. However, just as Ondo’s focus began to gain momentum, the project unexpectedly encountered an issue entirely outside its business plan—the founder passed away suddenly, and the ensuing battle over control of his estate is gradually evolving into a complex dispute involving corporate governance, family members, and even cross-state courts.

The story begins in May of this year.

In May of this year, Ondo's founder, Nathan Allman, unexpectedly passed away at the age of 32.

At the time of his passing, Nathan was not only the founder and CEO of Ondo, but also the sole director and controlling shareholder. His sudden death has left Ondo with a very immediate question— who will take over the company?

On May 26, Ondo officially released a statement confirming Nathan’s passing and announced that Ian De Bode, who had long served as president, would assume the role of CEO. At the time, the company clearly stated that De Bode had been responsible for the company’s strategy, products, and day-to-day operations over the past two years and had earned the full trust of the management team; he would lead Ondo in continuing the work Nathan had begun.

From a corporate operations perspective, this appears to be a smooth leadership transition; however, the issue is that while a CEO can be replaced, the equity left by the founder cannot be inherited merely through a company announcement—and this is precisely critical to the company’s long-term stability.

More critically, Nathan’s death was so sudden that he left no will regarding arrangements for his estate.

After Nathan's passing, the court ruled that his mother, Kathleen Allman, and his father, Lawrence Allman, are the legal heirs. According to subsequent court filings, Nathan's estate includes his controlling interest in Ondo, as well as a significant number of ONDO tokens, including both already vested tokens and those scheduled to vest over the coming years.

In June, a Hawaii court appointed Kathleen as the personal representative of Nathan’s estate. Subsequently, she began engaging in Ondo’s corporate governance.

The conflict between the two parties quickly became public. In July, Kathleen announced a restructuring of Ondo’s board as a shareholder, appointing herself as chairman and interim CEO, while attempting to remove De Bode from his position. Nathan’s sister, Tahnee Towill, was also appointed by Kathleen as a board member.

Kathleen subsequently filed a lawsuit in the Delaware Court of Chancery, alleging that De Bode assumed the role of CEO without valid board authorization following Nathan’s death and attempted to further consolidate his control.

One point of contention involves the compensation and equity incentive package received by De Bode following Nathan’s death. According to court filings from Kathleen’s side, the package includes an annual salary and bonus of $900,000, a signing bonus of $1 million, and 26 million restricted ONDO tokens, with a total value exceeding $11 million. Kathleen’s side argues that these arrangements are invalid and seeks court confirmation that the appointment and associated reward provisions are legally unenforceable.

De Bode denied the allegations, stating that Kathleen's lawsuit lacks merit, and added that the company has received support from major stakeholders and investors.

At this point, the original management transition has officially become a battle for corporate control.

The situation was already complicated enough, but in September, the competition took on a new twist: De Bode also gained an unexpected ally.

On September 16, Nathan’s half-sister Lani Clinton, along with Ondo early investor David Chen (previously proposed by De Bode for the board), applied to a Hawaiian court to establish a limited guardianship over Kathleen’s inherited share of Nathan’s estate.

In the application, Lani made a series of allegations regarding her mother Kathleen’s cognitive capacity, long-term alcohol use, and financial management behaviors, arguing that Kathleen may no longer be capable of properly managing this inheritance. In addition to claiming that her mother has a decades-long history of “pathological alcoholism,” Lani requested that the court obtain Kathleen’s medical records and conduct a dementia assessment.

The application also mentioned Kathleen’s long-standing lavish lifestyle, including her purchase or attempted purchase of a $4 million Zeelander yacht in Florida; private jet travel; requesting Ondo to reimburse a six-figure flight expense from Hawaii to California; and staying in luxury accommodations costing approximately $4,000 per night…

Chen also disclosed a text message from Kathleen, who, just nine days after her son’s death, reached out to the company demanding money: “Hi, I believe everything will work out over time, but what I’m most concerned about right now is cash flow and liquidity—the faster, the better! For example, I currently have a $200,000 invoice from a Newport pool contractor. I really want to buy that… yacht and other things.”

Because the estate represented by Kathleen includes a controlling interest in Ondo and a large number of ONDO tokens, these allegations ultimately pertain directly to Ondo’s control.

It should be emphasized that the above content constitutes a unilateral allegation currently under litigation and has not been established as fact by the court. Kathleen’s side denies the allegations, stating they are entirely without factual basis. Kathleen also believes this lawsuit is merely another move by De Bode’s camp in their struggle for control of the company, alleging that De Bode and Chen are colluding to replace her with a more compliant trustee.

Thus, a corporate governance dispute originally centered on the CEO appointment evolved into two interwoven legal fronts: one in Delaware over control of Ondo, and the other in Hawaii over the administration of Nathan’s estate… with both sides vying for the same core asset—Nathan’s shares and token interests in Ondo.

As of now, this struggle remains unresolved. Pursuant to a court order issued in early September, De Bode continues to serve as Ondo’s interim CEO and retains his seat on the board; new litigation that emerged in mid-September has further publicized the internal disputes within the Allman family.

Ondo continues to advance its asset tokenization business. An increasing number of traditional assets—such as U.S. Treasuries, funds, and stocks—are coming on-chain, and the industry itself is still rapidly evolving.

For a project at the forefront of this space, the founder’s sudden passing has had far-reaching consequences beyond mere leadership succession. Issues of corporate control, inheritance, and family dynamics are deeply intertwined, and it remains unclear where things will ultimately lead. But for all ONDO holders, we clearly do not want to see a rapidly growing, outstanding project stalled by this unexpected battle over legacy.