Lympo cannot possibly work, and how they raised 17 million dollars for a broken concept is nuts. CryptoPanda Follow May 4, 2018 · 14 min read

Key Points:

Lympo ecosystem has three platforms: Rewards mechanism, product and data marketplace, and crowdfunding platform.

Rewards mechanism cannot work. Physical activity data is easily manipulated. It is a hardware problem, not a software problem. Additionally any meaningful payout would cause inflation.

Data marketplace cannot work. With a powerful incentive to cheat and no way to identify cheating all recorded data is useless.

Product marketplace cannot work. Using an extremely volatile crypto for an online marketplace is a stretch. Even businesses are hesitant on accepting BTC, which is far less volatile than a sub 100m token.

Crowdfunding platform makes no sense and is unrelated to everything else. This is an eye catch money grab that I won’t give credibility to.

The Lympo team is deceitful in writing and in promotional material. One of their partners recently lied in a promotional ad created by Lympo.

Problems facing Steemit, a token rewards based platform.

I come from an exercise science background. I was a personal trainer for 6 years, some of those years at pretty fancy places.

I dreamed of making a fitness rewards token, but always ran into the same issues. You can’t have a “fitness rewards token” if it is based on rewards from physical body movements as recorded by wearable tech. This data can be faked in a variety of ways, but is dependent on how complex the fitness tracking device is.

Nearly all if not all fitness devices use accelerometers. Accelerometers do exactly as they sound, measure acceleration.

More expensive fitness devices also use altimeters. These measure changes in altitude, recording vertical movements as well.

The apex of wearable tech incorporates GPS tracking and a heartbeat sensor. I contacted Apple for clarification on how the Apple watch works, and if you can cheat it. You can’t put it on your dog, the heartbeat monitor wouldn’t pick up on it. You can’t put it in your dryer, GPS would identify it as false info plus no hearbeat. Yet even with all of these lazy forms of cheating, you can still give the watch to someone else to do the work.

When used for its intended purpose, this tech works wonderfully. Once an incentive to cheat is introduced, it becomes entirely useless.

Here lies the problem. Any reward given for recorded physical activity cannot work. It is simply to easy to fake this data. This can be remedied by using more expensive tech, but even then the device can be given to someone else to complete the work.

Lympo team thinks software can solve a hardware problem:

The Lympo platform revolves around LYM tokens, used for many purposes but largely given as rewards for physical activity and meeting goals. I spoke with a team member on this obstacle, and they responded:

“Manipulating physical fitness data is not actually easy, at all, in 2018. While there may be some lesser-used apps/trackers that have not updated their tracking software and mechanics, we have already implemented a variety of measures to prevent this, on top of the advancements that have been made in the industry over the past several years.”

This is blatantly false. Software is not the problem, hardware is.

“I have a few more questions regarding fitness tracking manipulation. All affordable fitness trackers use accelerometers, nicer ones also use altimeters. These can all be manipulated in many ways, including throwing in a dryer, putting on it on your dog, shaking it with your hand, etc. There is more expensive tech, like the Apple watch which has a heart rate monitor as well as GPS tracker. This prevents easy forms of manipulation, but still can’t stop the most basic form of cheating, giving it to someone else to wear. Currently fitness data is fairly accurate, there are no incentives to cheat. With a platform such as Lympo there becomes a strong incentive to cheat, especially if its easy. This would make all data collected by Lympo useless. How will Lympo ensure users are not cheating?” “Assuming there is no cheating, the reward payout must be minimal to avoid inflation. Could you give me an estimate of tokens rewarded for the following activities?

- Running a mile

- 5 sets of chest press

- Rock climbing for an hour”

Their response was completely nonsensical and didn’t answer my question in its entirety:

“I think this is happening due to lack of understanding from support team what usecases will be integrated” “This can include not only aggregated data, but also tests about healthy lifestyle, tests for visual materials and etc. Not only data from running apps will be aggregated. Also we are already in discussion with gear engineers about preventing all kind of cheating. There is a lot of measures and standarts for that and for now we will be able to prevent this with calculations for what is legit or not and will not give LARGE rewards that will allow users get a lot from cheating. In the feature we will definitely implement data analyzer based on AI that will be able to do decisions if data is legit and suitable for challenges submission. Because there is a lot of parameters included and even more data will be collected from different gadgets this is that we do regarding raw collected data”

Again, this is a hardware problem not a software problem.

Lympo and fiat, an unbelievable conversation:

When asked about fiat on Lympo, I was repeatedly given the same deceiving answer, and even after clarification I was asked to include a lie in my previous article:

“Firstly, regarding Fiat conversion. LYM can already be found on a variety of exchanges, where tokens may be converted to USD/EUR. Additionally, on our platform we will start by allowing purchases with fiat as well to get the product going for those unfamiliar with crypto.”

“Purchases of LYMP with fiat? Can you withdraw to fiat as well?”

“Purchases of LYM with Fiat. = Yes. You can withdraw your tokens right from the App/Digital Fitness wallet, to an exchange and convert them to Fiat as I mentioned; we already have several listings. (KuCoin, Gate.io, IDEX and Cobinhood), and this is possible with LYM tokens already, prior to the app being launched.”

This is a blatant lie. You absolutely cannot in anyway purchase LYM with fiat on any exchange. I am not sure why they continue to equate real U.S dollars with Tether dollars.

“There are direct USD Pairings for LYM available on our exchanges, so it is only neccessary to use a single one for the entire process, and there are a variety to choose from to suit different individuals.”

The USD pairings are for USD Tether, or are there direct LYMP to fiat?

“USD Pairings refer to the fact that within that exchange, you may directly sell LYM for USD; without having to first convert the LYM to ETH for example, making the process quite simple.”

I think the team member is as confused as someone who has never heard of Tether dollars, and tries to sell their LYM for actual cash. He then asked me to include this in my original article:

“and can you just add “LYM can already be found on a variety of exchanges, where tokens may be converted to USD/EUR.” coming soon or something? :)”

“For sure. USDT or USD? Just want to clarify if its withdrawal to cold hard cash vs. tether.”

“USDT not = USD :)”

Lympo partner lies (multiple times) in a promotional video:

The Lympo team politically sidesteps questions and lies. If that wasn’t bad enough one of their partners, Caroline Wozniacki, blatantly lied in a promotional video:

“Such a great idea with the Lympo tokens and everything so you get rewarded every time you go out and move around and I think that is so amazing. I use Lympo myself because I do so many sports obviously tennis is my main priority but you know running the NYC marathon I do a lot of boxing i do swimming I do all these things and I already track my workouts I communicate with my trainer whenever he’s not around with the devices that I have but with using Lympo its that extra motivation and I can put the two together get the best of both worlds and reward myself after a hard week of workouts.”

I’m not sure how using Lympo is motivating when the platform isn’t operational and theres nothing to use. Their roadmap doesn’t state when rewards will be introduced to the platform, or what reward payouts will look like.

Hows Steemit doing?

Lets look at Steemit as an example of a tokenized rewards system. Signing up for Steem takes 1–2 weeks as they need to verify you are a real person. Upvote bots are a very real problem. Steem rewards are click based, an extremely simple method when compared to rewards given for physical activity. Anytime there are rewards, there will be endless attempts to cheat the system.

Lets assume their right. You can’t cheat the system:

There is no incentive to invest in Lympo, but there is a strong incentive to sell Lympo. As more users enter the platform and more rewards are paid out inflation will tank the price. The only way to prevent this is to have minuscule rewards, which would destroy the concept of a fitness rewards platform.

The whitepaper has no information on how payouts will be conducted, which is shocking considering that is a staple of Lympo. Are reward payouts done in terms of USD or as a set amount of LYM? Why would a business or a personal trainer accept a highly volatile asset that can’t quickly be converted to real USD?

Disheartening and upsetting:

The problems faced by any fitness rewards platform are to great to overcome with todays wearable tech. Even if the tech was perfect, reasonable payouts would cause inflation and nothing would stop a user from passing the device to a friend.

The Lympo team must have not been aware of the shortcomings of wearable tech, as they had no mention of these issues in their whitepaper. There is no detailed information on the rewards system, even though it is the foundation of the entire LYM ecosystem.

I won’t lie. The thought of conducting an ICO for a dope sounding project crossed my mind. I have the credentials and the connections. But at the end of the day, it would have been fraud. Creating a successful fitness rewards platform, as outlined by Lympo, is impossible.

Conversation screenshots below:

Lympo team responds one day after publishing:

This response is a thread on Reddit. It may or may not be deleted in the future, in any case here is the link.

I decided to write a well thought out response here, to attract a larger audience. Their response was pitifully weak:

“Dear Crypto Panda, this is a response to your erroneous and misleading post about Lympo. There are major factual errors in your Medium article. First of all, we did not collect $17 million in our ICO, instead a total sum of $14 million was raised. You shouldn’t trust the first source found on Google. Secondly, regarding the ad with Caroline Wozniacki. We understand that you might have misheard Caroline saying “I use Lympo” instead of “I would use Lympo,” but it’s a shame that you didn’t double check it. You can hear it clearly here: https://youtu.be/zLCivsUTH58?t=44 There are plenty of articles on Caroline’s engagement with Lympo saying that the app will be released later this year. It is also clearly indicated on Lympo.io, Lympo.com and in all of our communications, we are completely transparent about it. Thinking that a world-class star would risk her reputation saying something as false as this is rather incredible. These kinds of deals are discussed with multiple people representing the athlete, including written communication on every single word that Caroline would say. We are disappointed with this demonstration of complete ignorance about Lympo and bold accusations regarding our ambassador. To continue, yes, you are right — there will always be cheaters, be it fitness, taxes, gaming or any other area. Despite this, technology is constantly evolving due to innovative solutions and every day it is getting harder to cheat on all kinds of systems and platforms. With the right measures taken it inevitably comes to a point when cheating simply becomes too much of a hassle. We are already actively discussing with gear engineers about preventing all kinds of cheating. There are many measures and standards for that and for now we will be able to reduce it with programmed calculations, taking into account various factors which will serve to evaluate the validity of submitted data. In the future, we will certainly implement an AI-based data analyzer which will be able to evaluate data to an even greater degree of accuracy. Large amounts of raw data with multiple parameters will help to continuously train the AI and ensure the ever increasing accuracy of analysis results. Furthermore, token rewards will be small enough not to create an incentive to put actual effort into gaming the system — it just won’t be worth it, and so cheaters will not compromise our ecosystem. In fact, the challenges too will be designed to minimize this risk: 1. Challenges posted by a users’ personal trainer after they paid in LYM tokens will work as a cash back option. One may cheat on those, sure, but generally, this group of people is interested in getting fit rather than struggling to find a way to cheat an app. 2. Challenges by sports events where you have to provide, for example, your marathon ticket number. This group of users is genuinely interested in running. They will pay a participation fee in advance and later use Lympo as a cash back system. We believe that this too will help minimize cheating, together with other measures. Going further, we agree that there was a miscommunication regarding purchases of LYM directly with USD. There are no direct pairings like LYM/USD, LYM/EUR or LYM for any fiat. You are right; this was a communication error from our side. We would also like to add that we are, in fact, currently working with several exchanges to launch LYM/Fiat pairs. Although we appreciate your efforts to write a comprehensive critique, in this case your position on Lympo is simply mistaken, and your tone is unconstructive and accusatory. In the future, we will only engage in constructive discussions since it takes too much of our time to respond to every single baseless accusation. Lympo team”

ICO Info:

The information on the ICO was not listed on the Lympo site. I went with the closest estimate which was $17 million as listed on ICO drops. ICO bench lists Lympo as raising $8.36m, Track ICO says $11.5m. Considering this, I think I got pretty close. This is hardly a point of contention but I’m glad it was pointed out.

Caroline

Caroline was unintelligible in some parts of the interview, but is clearly heard saying “With using Lympo I think its just that extra motivation”. This is a present tense statement, clearly expressing that she uses the platform. Again, commenting on how motivating something is when it does not yet exist is an extremely bold claim to make, or just a terribly scripted statement.

Repeated claim that software will fix cheating:

Preventing cheating using software is impossible. I spoke with Apple engineers on the ways an Apple Watch and other fitness devices can be cheated. I also know this from my years working as a personal trainer, using and recommending dozens of types of fitness tech. It all comes down to hardware being vulnerable to cheating, and no amount of software upgrades will change that. The Lympo team repeatedly claims software can fix this problem, it is a complete lie.

Reward payout:

This is actually hilarious, as its an admission their platform cannot work:

“Furthermore, token rewards will be small enough not to create an incentive to put actual effort into gaming the system”

If a fitness rewards platform can’t payout rewards, what exactly is it? Yes, I understand Lympo is more than a rewards payout system, but the cornerstone of how the ecosystem works is rewards given to its users.

Reward payout example:

Challenges posted by a users’ personal trainer after they paid in LYM tokens will work as a cash back option. One may cheat on those, sure, but generally, this group of people is interested in getting fit rather than struggling to find a way to cheat an app.”

I am not sure what this means, but “cash back” is deceitful, LYM are tokens and not cash. There is no fiat gateway, and despite answers given to me suggesting otherwise, LYM cannot be exchanged to fiat.

Regarding the second point, I think any business that posts a statement based on assumptions rather than research is a business you should stay away from. Again, cheating these devices is not a struggle, its extremely easy.

Reward payout example 2:

“Challenges by sports events where you have to provide, for example, your marathon ticket number.”

The average cost of a marathon in the U.S is $60-$100. I would love to understand how the Lympo team thinks. Uploading a picture of a $60 bib to get a minuscule reward is a joke. At this point I think Lympo is flying by the seat of their pants trying to answer hard hitting questions.

Closing:

“Although we appreciate your efforts to write a comprehensive critique, in this case your position on Lympo is simply mistaken, and your tone is unconstructive and accusatory. In the future, we will only engage in constructive discussions since it takes too much of our time to respond to every single baseless accusation.”

Rewards are small enough to not incentivize cheating. Essentially rewards are very, very small. For a rewards based platform, this is a pretty destructive statement.

Lympo thinks their software engineers are more experienced, talented, and understand more about tech than Apple engineers.

Lympo is upset I pointed out the horrible script Caroline read for the promotional video.

Lympo assumes users won’t cheat, because “…this group of people is interested in getting fit rather than struggling to find a way to cheat an app.” Last time I checked, successful businesses were not based off of assumptions.

The Lympo team has never run a marathon, or doesn’t understand how the health and fitness industry works in the United States.

In their closing statement the Lympo team essentially said they were done talking to me on this topic. I think anyone reading this article should decide for themselves if these claims of mine are baseless. I’m sorry if my tone seems harsh, its not personal its businesses.

If you don’t want your feelings hurt don’t make a shitty product and deceive your investors by leaving out key information in the whitepaper.