Substratum, the project that has been dogged by controversy for months, has “reached the end of its funding” according to the lead developer who has been laid off from the company. The project, which raised $13.8 million during its ICO two years ago, gained notoriety when the CEO Justin Tabb admitted that they had hired a day trader to trade ICO funds before the project was delisted by Binance in February. Dan Wiebe, who announced the news on Twitter, stated that three other developers have also left the project, but he will stay on in a voluntary capacity for now.
Last Friday I was laid off (not fired) from Substratum. Subsequently I was offered a short extension, but I had made other plans, so I declined. So my ongoing work on SubstratumNode will be as a volunteer. I’ll be at https://t.co/Zk5VfpNDbM to answer questions.
— Dan Wiebe (@dnwiebe) 9 September 2019
Gross Mismanagement of Funds
Substratum’s $13.8 million ICO raise was conducted at a time when ETH was valued at around $300. Five months later the haul would have been worth more than three times that given ETH’s ballooning value, which makes the fact that the project has already run out of funds all the more staggering, illustrating gross mismanagement of their windfall. This is less surprising however given some of Wiebe’s comments on the situation:
There was never any revenue in the business model, so of course the money had to run out sooner or later. I guess it chose a point somewhat between sooner and later, and ran out after almost two years.
Wiebe seems incredibly blasé about this, calling their money management “not bad”, but this is further evidence to back up the theories of crypto writer Brian Li, who in January investigated the Substratum ICO. Li concluded that some of the ICO money went missing around the same time as Tabb purchased a $400,000 house and some expensive “toys” during the crypto boom of 2017.
Substratum Project “Can’t Possibly Work”
Concerning the project itself, it is even less clear what the millions of dollars have bought investors:
Substratum Host? Just a little thinking. No formal planning, certainly no coding. The biggest problem there that I see is the private-key problem, which I have detailed elsewhere. It’s a real showstopper; until somebody smarter than I have been so far figures out a way around it, there’s really no use spending more effort on Host. Without a solution to that problem, it can’t possibly work.
As many have realized for some time, the Substratum project, a favorite of Nicholas Merten, host of YouTube’s ‘DataDash’ show, is circling the drain, with Wiebe describing now as a “perfectly reasonable place for the community to take over…”. The token, once riding high at $3.15 now sits at a lowly $0.009, with only the smallest exchanges hosting the coin and less than $30,000 in daily volume. It seems like only a matter of time before Substratum is put to rest in the Shitcoin Graveyard.