Recently, there has been a lot of hype surrounding cryptos newest utility darling, Wabi. According to the white paper, Wabi is a “digital cryptocurrency which supports Walimai’s anticounterfeit system and is backed by sales of products”. Walimai, in turn, is a company founded in 2014 in the wake of counterfeit infant formula scandal which left 300,000 victims hospitalized or dead in China. The companies clear need for a blockchain to create a reliable product along with its practicality in the rapidly growing Chinese market has made it a HODL for many cryptocurrency investors.
Indeed, the problem with Wabi has nothing to do with the product itself. The product is in active use around the world and has fueled revenue growth for Walimai through partner JD.com where consumers have given great feedback and shown a willingness to pay almost 20% more to make sure these products are safe. This traction is fantastic and has led to many-a-fundamental analysis praising the product.
The problem has nothing to do with the token itself. The problem with Wabi is the founding team’s complete and utter disregard for their community and investors as well as a lack of focus on the part of their team. Wabi, unlike many other cryptocurrencies, has a founding team that operates as a corporation. It’s been almost 4 years since Walamai’s official founding and reportedly 6 since the founders started discussing the idea. Their corporate structure, strictly internal communications prior to press releases, and communication cadences are firmly entrenched and not well suited to the cryptocurrency market.
Communications to the community and investors are infrequent and result in concern from the community as to whether anything is happening internally, what stage they are at in initiatives that they had clear deadlines on, and whether anything is being done on the product at all. Take for instance the Wabi website. Prominent on the website is a timeline of the team’s accomplishments. The timeline starts off in 2008 with the infant formula scandal and shows progress through September of 2017 where they show that the impressive milestone of “First sales at physical baby stores” was accomplished. However, their milestones after this date (coincidentally, also the date of the pre-sale) have been mute. The roadmap shows that milestones in November-December 2017 and December 2017 have not been completed yet.
This, combined with infrequent medium updates (compared to the weekly updated done by many other coins), and the failure to hit their self-proclaimed milestones causes me great concern.
Finally, and this is my most concerning discovery, their tech team would seem to include 2 very busy people:
The first is Roman Tronenko, identified on their website as the Mobile Lead/Blockchain Architect. He seems extremely talented but appears to have executive positions at 4 different companies. He’s a Founder/CTO at gogo.tattoo, an interesting project aiming to bring the blockchain to tattoos to ensure originality, connect clients with artists, and make portfolios permanent. He’s also a Senior Mobile Engineer at italki, an online language learning platform that appears to have raised a $3,000,000 series A round. It’s also purported to have 3 million users and 5,000 teachers. The companies LinkedIn says it has between 51-200 employees. Finally, he is the CTO at MDL, another interesting startup hoping to bring blockchain to talent sourcing. Their (Italki) latest blog post was about two weeks after Wabi’s. While this man is obviously extremely impressive, it causes one to wonder why he has so much on his plate. Is Wabi not lucrative enough? More importantly, why aren’t they paying even a single full-time software developer after all the money they’ve raised.
This brings us to our next developer, Dmitry Korzhik, who has another extraordinarily busy schedule. Dmitry is listed on Wabi’s website as “Blockchain Lead” and on his own LinkedIn as “Blockchain Development Engineer”. Either way, it’s clear he’s supposed to be doing some of the programming onWalimai’s array of products. This isn’t the first role on his LinkedIn, however. According to his own LinkedIn his primary role is “Product Development” at Rocket ICO, a pretty awesome online startup incubator and investment platform. This ICO has raised over $1 million and is looking to raise $10 million in their token sale. As if this weren’t enough, Dmitry is also the “Chief Business Development Officer” at a company called Mind development which I couldn’t find much info on but apparently is a public company located in Minsk. Finally, he purports to be an IT Consultant at a company known as “Radiation Instruments and New Components LLC” which appears to be a company he set up to do consulting for engineering firms working on new projects. Once again, I have no doubt of this developers talents, but can’t help but question if he’s spread a little thin.
Finally, we have Arthur Pinchuk the “Software development team leader”. In my experience, this doesn’t usually mean he’s writing any code but we’ll include him here anyway. Much like Dmitry, Arthur’s first role is not listed as Walimai but as the “Board Director for IT Strategy” at Rocket ICO. On this website, he’s listed right next to our friend Dmitry Korzhik, who’s listed as the “Head of Product Development” on the Rocket ICO website. On both websites, it sounds like he’s not doing much coding at all.
Wabi’s technical team concerns me. They’ve got milestones to hit which closely involve their tech team and an app which has just “previewed” on WeChat but not been shipped yet (indicating there is still much work to do). The teams lack of focus is disconcerting in a market where speed seems to be everything and competitors are entering every day. Added to the dearth of dedicated engineering talent is the lack of outreach, failure to hit milestones, and general lack of focus. Their PR team and as far as we know their business development people of which none are specified on their website consistently fail to capitalize on incidents like the recent recall of baby food in 83 countries.
All of this has caused me to significantly shrink, but not completely get rid of my position in Wabi. I still have confidence in their core product offering, and that pressure from customers will force them to build a better more focused team. Until then, I’m going to HODL my remaining position.
Disclaimer: The views expressed in the article are solely that of the author and do not represent those of, nor should they be attributed to CCN. This article was originally published in December 2017
Featured image from Shutterstock.