On September 9, Karma developer and Karmashares LLC operator Kosmost announced that he was taking an indefinite hiatus from the Karma community. He stated that he was disappointed with the negative reactions his leadership received from large portions of the Karma community and that the personal attacks were beginning to take a toll on his health.
I have decided today that I will take a sabbatical from Karma community and will no longer be involved in its affairs for an indefinite amount of time.
Yesterday I made the decision to shut down Karmashares LLC in order to further protect myself from being publicly and privately attacked. However, this resulted in a good majority of the active Karma members (at least, those who are currently posting) to attack me even more.
I do not have the time for this, nor the stomach. My participation in Karma has always been voluntary. I have been glad to give my time and resources in order to further the cause. But without community support there’s not much that i can do. I was literally on my way to the Philippines and Vietnam to do research regarding our new direction. But without help there’s not much I can do.
He went on to state that he was not going to abandon the coin outright–he wanted to work toward a smooth leadership transition. He announced he would accept proposals from community members who were interested in assuming leadership responsibilities.
Today, I have decided to take a break from Karma for the betterment of my own personal health. We need more active people on the team. If you’d like to join the team please reply here. Over the course of the last few weeks I’ve heard several times the phrase, “…it could have been done better”. Well, now is your chance to show everyone how it should be done.
As of September 18, several community members had put forward proposals to assume control of different aspects of Karma and Karma-based services, but no decision had been reached.
Investors responded precisely as one would expect upon hearing a coin developer was leaving–they began selling their Karma in large quantities. In the several months preceding Kosmost’s announcement, the Karma price had already fallen quite a bit, moving Karma’s market cap from a ~30th place ranking to ~55th. Upon news that Kosmost had closed Karmashares (an announcement several days prior to his decision to leave Karma), the Karma price dropped significantly, falling below 1 satoshi on September 8. Dropping below 1 satoshi is a veritable death sentence for a cryptocurrency, because it means they are confined to Litecoin trading pairs on altcoin exchanges. Over the past week, the Karma price dropped another 26%, and its daily volume has dropped to ~$1,000. At present, Karma is trading at 28 litoshis on MintPal. Karma’s market cap is ~$80,000, ranking it 124th among all cryptocurrencies.
At current prices, investors do not stand to recoup much of their original investments, so their best option is probably to hold onto their coins, hoping a competent developer assumes control of Karma and guides it back to a respectable market cap ranking. New investors should view Karma with extreme caution and should only buy it with the understanding that Karma is a penny stock with moderate potential upside.
In anticipation of the price decline following his departure announcement, Kosmost composed a Reddit post about how to accurately calculate the value of one’s Karma holdings. His post included a reminder that cryptocurrency is a volatile industry and should not be used to house long-term investments.
Don’t ever think of crypto as an “investment”, because it is not. Always assume you will lose 100% of the value of what you put in. That means never “investing” more than you can afford to lose.
Altcoin investors should take Kosmost’s words as a cautionary warning. A coin is only as strong as its development team’s skill and commitment.
Disclosure: The author has a very small amount of Karma.
Featured image from Shutterstock.
Last modified (UTC): September 21, 2014 01:54