Substratum and it’s new Amplify Exchange is starting to look like a Major Money Grab

From its goal “Earn crypto, change the world” to a 2nd ICO within a year

We’ll discuss what is going on with this company and look at past and present events in an objective manner.

Warning ⚠️: If you are invested in this project and believe in its future success no matter what, this may not be the article for you. Please stop here.

Pictured: Substratum Evangelist and CEO, Justin C. Tabb. Unbeknownst asian lady.

Why a second ICO?

Twitter and social media channels alike have all boasted concerns for the announcement of a 2nd ICO for Substratum. Those who are truly grounded in reality and not living aboard the “Substratum Express” all want to know why?

In this article we will address a few of the potential issues we can find and questions that arise from them.

AMPX ICO

Recently, Substratum a project whose goal is to decentralize the web through web hosting and running a node on its nonexistent network has came out with with a new ICO. The team will be the same from Substratum with a couple new members joining the Amplify team. The whitepaper and their funding model has been released to the public, through it however we can see several concerns regarding the funding mechanism, tokenomics and the overall shadiness of the original project.

Whitepaper

Reading the Amplify whitepaper for the AMPX ICO, we merely see a powerpoint and screenshots for the unbeknownst and uneducated crypto investor. Accredited investors would laugh at this and there are many parallels drawn to the original Substratum whitepaper with it’s lack of clarity and technicality. Lets dig deep into some of the nitty gritty pieces such as the roadmap, token allocation, tokensale timeline, and it’s airdrop program.

I. Roadmap

Given the team’s past experiences with deadlines and projections for releases it’s interesting to see how they will fulfill Amplify’s roadmap. Their original Substratum full version node was delayed for a full year with minimal justification for the reasoning behind it. How do we expect them to fulfill these promises in Amplify? Can people change overnight?

Amplify Exchange Roadmap

We see here within the roadmap they have a relatively short plan only stretching for a year. They plan to release Amplify Distributed Exchange v1 by Q2 of 2019 and begin Bridgechain development. The Substratum ecosystem is conversely becoming more convulated and overly ambitious. They plan to deliver now not only their 3 main products of Substratum Node, Host, and Cryptopay but also Amplify development. That’s a lot of work for such a small company and an overly ambitious goal. How are they going to still be able to focus on core product development when half of their dev team has mitigated to work on building a new blockchain?

Per Dan Weibe’s tweet Substratum Host is “really still off for the future”. I think this is just the team realizing their node will be a flop and not get mass adoption as it was intended to obtain. They need something else to move to and make money from, it would appear Amplify offers just that.

II. Token Allocation

Token Allocation — Amplify

Amplify funds will dispersed with 61.66% of the total minted supply going to Private Sale/ Pre Sale/ ICO phases, 33.33% going to “Operational Team” and a small 5% going to the Airdrop.

While I can’t imagine the team has the absolute confidence they will sell all minted tokens for the public, I have to wonder why there is nothing mentioned about what will happen with unsold tokens from the ICO. This also relates to Substratum ICO, where still 89mill unsold ICO tokens are left on the crowdsale address, which were always claimed to have been burned. With the first argument “when Bittrex listing happens”, quickly devolving to “it’s not our focus right now because we are busy”. Even tough a token burn takes 1 minute of your time. These tokens were never released on the market so holding back the token burn for “price effect” has no meaning but remind any intelligent observer that the reason we are using blockchain is because we should not be trusting people. Yet here we are.

More so, there is a high token allocation for “Operational Team” resulting in obtaining 33.33% of the total minted supply. This is very high and it was attempted to be addressed by a telegram user in the main Substratum Network Community with the CEO, Justin Tabb.

Pictured: CEO Justin Tabb explaining how the % is almost identical

In Justin’s response he tried to convey and justify the large percentage by saying Substratum had a similar ratio for “Operations and Team” token allocation. Doing some simple math Substratum had 60 mil SUB for system funds, 15 mil SUB for Founders & Team, and 40 mil for advisor payouts. That’s 115 mil sub dedicated for “Operations and Team”. The total supply of Substratum is 592 million tokens. In what world does 19.42% compare to AMPX’s 33.33%? Only in Substratumland is a 13.92% difference “almost identical”.

Soft Cap

The soft cap for Amplify was met mysteriously rather quickly and without any formal announcement prior to obtainment of funds. This is normal but considering current market sentiment and overall performance of ICO’s YTD, very odd it was reached so quickly.

Typically ICO’s reach their minimum soft cap within hours to a few days. But we’re not in a bull market like last year and conversely the trends for investing into ICO’s at this stage of time has been all but promising and welcoming.

There were unusual trading activities on October 5–7th leading up to the announcement of Amplify reaching their soft cap on the native SUB token order books. A whale put up a 13 million SUB sell wall and the wall reached a high of 20 million SUB at one point.