Gladius Network LLC, the company behind the Gladius project that raised $12.7 million during a 2017 ICO, has shut down operations having run out of money. The announcement follows a terrible 2019 for the project and the team behind it, which has included giving themselves up to the Securities and Exchange Commission (SEC) and subsequently having to return investors’ money, as well as trying to quell investor revolt.
Give Teenagers $12.7 Million and See What Happens
Gladius was intended to be a computational power and bandwidth rental platform, but faced criticism early on due to the age of the team – the two co-founders were barely out of high school, and indeed were in college when they raised the 24,000 ETH for the project two years ago. It shouldn’t be a surprise therefore that perhaps mistakes were made and the money ill-used, although they seemed to receive some sound legal advice in 2018 when they reported themselves to the SEC for potential securities violations. This ensured they avoided a fine, but were instructed to return ETH to investors who requested it, a ruling that was handed down in February this year.
No Developments, No Community Chat, No Money
By July however, no refunds had been issued and the community was growing understandably restless. This led to Alex Godwin, one of the co-founders, taking the step of turning the project’s Telegram community chat group into an announcement-only channel due to “unhelpful conversations that we can’t currently moderate”. As members of other exit scams will know, this is very often a precursor to a complete project shutdown, as was the case with Sparkster.
By this point there had been no development updates for three months, and the first deadline for the team to register their tokens as securities came and went. Further extensions were granted in August and October, with a final deadline set at November 18. This proved to be the final straw for the project, and four days later the announcement was made that the company had gone under due to a lack of funds, which explains the absence of refunds that the SEC had demanded. Sadly therefore, Gladius has to go down as another casualty of the 2017 crypto boom, and the investors have been handed a harsh lesson in wise investing.