As my first “uncovered” report, I will be briefly exposing Sparkster for its unprofessionalism, lies, and endless stringing-along of its supporters. Do note that I personally did not invest in Sparkster, but have been following the project on and off long before it started gaining popularity. Recently, I went to the Telegram to checkup on how things were going and was baffled. It’s a shitshow, to say the least. There are an enormous amount of blind followers there (some may be paid to give positive comments – I took a look at a few accounts and they are reposting the same positive messages on different days), and anyone questioning the state of affairs will be turned down/harassed by others in the chat, and eventually silently banned. I began to ask questions in the chat regarding the code, funding, etc, and was promptly banned (along with many other people whom were asking similar questions). I had no intention of writing a piece on this project, as I felt it would not be worth my time and effort. However, once I was banned, enough was enough. As for the people who may say I am a “FUDster” with an intention to buy tokens cheaper or some other hilarious accusation: you’re wrong. I have no desire to purchase any Sparkster tokens even if the marketcap dropped to $500,000 on release.
Beginning
If you ask around, almost anyone will tell you that Sparkster gained its notoriety from Ian Balina. I did not pay much attention to Sparkster’s existence until Ian’s endless shilling, as I did not find the project an attractive investment (raise too high, idea easily replicated and not unique, and more reasons which are irrelevant to this post). Why do I call it shilling… what if he legitimately loved the project? Take a look at Ian’s AMA and demo with the Sparkster CEO, Saj:
Besides the unprofessionalism of Saj during the AMA, if you actually sit through and watch the demo, you will be dumbfounded at how un-revolutionary it was. The whole demo is botched, with Saj constantly needing to fix/adjust things during the demo. And what does Ian do? Nothing. No disproval, no hard questions. He seemingly ignores that the whole demo was a trainwreck and acts like he just witnessed game-changing technology (on a completely centralized network with very few nodes, mind you). Not only does he regard the AMA/demo as a success, but he continues to talk positively about Sparkster and also gives it a high rating on his renowned spreadsheet. Hmm… what did Ian do after the token sale finished? Nothing again, surprisingly… he has not mentioned Sparkster in ages. It’s not even on his portfolio transparency page, which he concocted after the SEC influencer crackdown began (https://ianbalina.com/pages/transparency). Hmm… strange.
Telegram Chat
This is where most of the fun happens. As mentioned in the introduction, the Sparkster telegram channel reeks of suspiciousness. Anyone who praises Sparkster has a place to stay, while critics are silently banned (messages not deleted, but users are banned without warning). Take a look at one of the copy & pasted messages I found when browsing the history of the channel:
This is just one of the many positive messages that have been restated multiple times, by a lot of different accounts. I’m not sure what’s going on here exactly, but it doesn’t seem normal whatsoever. You will not find messages like these in other project channels. Saj and the other admins have no problems with positive messages, no matter how manipulative they may be. But if you are a critic and ask one too many tough questions, you will be banned.
Moving on, I noticed that Saj was having the time of his life with the hype generated by Ian Balina.
Saj – the face of the entire project – is giving price predictions in chat. Stick with the team, and they will deliver 300x, he promises. It’s a life changing platform! Is it really?
If you look at more professionally-run ICO telegrams, admins will not comment regarding price, and for good reason. Any project that gives price predictions, such as the one seen above, should be followed with caution. Not only is it immoral to give price predictions for your project, especially as the founder, but in some jurisdictions, it is actually illegal to do so. For comparison, here is a screenshot from the Fantom Telegram group (another recent ICO). No matter how positive a comment may be, the admin will not condone or contribute to price speculation:
The screenshot of Saj’s “300x” comment was taken months ago – during the time of the ICO – however the comment has since been deleted by Saj. Luckily, it was saved by a few smart witnesses. Maybe no 300x after all.
But hey, at least Sparkster still has “100x” potential with the help of Ian Balina, right?
Indecision
One of the main gripes that the Sparkster community has had for the past few months is regarding token unlock. In May, Saj stated that the team was working on big exchange listings ASAP, and also that they were working on hiring market makers to provide liquidity for the token.
The team has since endlessly delayed unlock, due to “market conditions”. Sure, we can give them that. The market has not been entirely forgiving. But I will say that many projects have sucked it up and unlocked during these times. Some dropped in value dramatically, some not so much, and a few standout ones performed above expectations. Not every project unlocking tokens has been doomed in this market.
Recently, a vote was proposed on whether tokens should be unlocked now, or remain locked until further notice. The idea of a vote generated some positive feedback (which is expected, since many ICO participants are now tired of waiting after so many months)… however, the vote was then postponed. Why?
Wait what? The premise of the vote was “stable conditions”? I’m confused, I thought the vote would give the community a chance to decide whether or not to unlock the tokens in this market no matter how bad the conditions are. But no, the vote can only be done in “stable conditions”… which is confusing, because then why would you need a vote in the first place? If the market is stable, wouldn’t tokens be unlocked anyway? Or is the team waiting for a bull market just so they can have some ROI, no matter how small?
Sparkster was also going to facilitate an OTC desk so people wanting to get out could get out. But surprisingly, this idea was scrapped. I wonder why (Sparkster tokens are currently going for a very low price on unofficial OTC, with some sells being as low as 0.15x ICO price).
At the end of the day, if you have a promising and unique platform, exchanges, and market makers, as you say you will have – there is no worry, as dumpers will dump and holders will hold. Once the true value is determined, organic growth can be gained afterwards, given you are actually working on the project. Speaking of working on the project…
Development
According to the team, Sparkster has two parts: a soon-to-be patented private platform (which the team has supposedly spent many years working on) with code that will never be shown to the public, and an open-sourced “cloud” portion (which is what the code and ICO money is for).
Let’s take a quick glance at the GitHub:
At first glance, not even the profile itself is properly formatted. Nothing is set up professionally, and it looks like it was thrown together by a first time GitHub user. If you go to the code, it’s worse than this. 99% of it is incomplete. Not to mention no tests, no READMEs, and barely any documentation at all.
Okay, so why is the GitHub like this? The team’s response is that they will be releasing the code in portions. That a lot more needs to be done. That they just wanted to give us a sneak-peek at what’s going on behind the scenes.
Really? After over 7 months of extremely hard work, $30m in funding, a team of over 14 developers… this is what you come up with? Sparkster provides the community with a laughable excuse for code, and they don’t even attempt to polish the GitHub before releasing said laughable excuse. The money is well spent I see… (oh wait nevermind - will go into what happened to the funding down below)
As for the actual code. What does Andre Cronje have to say about this?
Alright… what does Saj have to say about this?
So, it’s an alpha, it’s better to get “something good out” rather than wait “a long time to seek perfection”, and stuff can be done “quickly” but they can also “respond to feedback”. Okay, looks like that’s the case here… not. The current code is not good whatsoever, especially for months of “hard work”. It wasn’t put out “quickly” as well – this code was released ONLY because community pressure had been building, after months of being left in the dark. Not to mention that the real community’s feedback is the exact opposite of positive. I say “real community” because there are actually comments in the Telegram like this:
Once again, not sure if Sparkster is hiring “supporters” to chime in on Telegram every so often, but I find it very strange. You will find people saying the code is good, great, or amazing, but if you ask why they think that, you will be given some robotic response, called a FUDder for a bit by other members, then banned.
Also note that Saj is saying the idea of Sparkster is something unique, but this is not true whatsoever; many users have pointed out that there are other similar projects already in existence, such as Oracle’s "Visual Builder Cloud Service". By the way, drag & drop has been done before and is not even close to being worth $30m.
It’s also worth mentioning that mainnet is scheduled for December 31st, 2018. Within 21 days. I have no comment for that.
Funding
So, Sparkster raised $30m from presales + ICO.
How did the team come up with the $30m figure to raise?
A lot of fancy talk, but in short, I think he’s trying to say that the $30m is required not only to develop the product, but also to heavily market it to big enterprises. That’s fair. Just keep in mind that the team needs $30m to do this, or so was said before the ICO.
Where’s the money now, you might ask? It’s being spent on development, marketing, and advancing the platform, right? Let’s have a look.
On August 24th, 2018, a person named Paul raised a very valid concern:
Saj’s response:
So it’s safe to assume that the investors’ funds have been managed properly? No, actually, that’s not the case at all.
Sparkster sold $900k worth of ETH, according to Saj. Keep in mind this was after the recent crash:
Okay, so $900k was sold, what for?
So $900k of ETH was sold after the crash because the market fell beyond their comfort level. No money was sold before to secure funding, even though Saj said that they were working with institutions to keep the raised funds protected. But wait, didn’t Sparkster raise a specified dollar amount of $30m? Yes! They raised $30m because they calculated that it would cost that much money to develop such a revolutionary platform, right? Or did they just raise that much because they could, with the help of Ian?
As a side note, any ICO that raises in $ amount but does not cash out the ETH/BTC/etc raised to dollars at the time of raise, is a red flag to me. If you do not want to convert to fiat after your token sale, then please specify that the raise is in ETH/BTC/etc. Funding for development of a project should not be speculated with, as it should be used for – surprise! - funding for development. A lot of projects have been exposed to be short on funds now during this bear market since they did not cash out any or little ETH. Runway for these projects is limited, and will most likely lead to their downfalls, unless they raise more capital later on. Projects that have cashed out all of, or at least a significant portion of, their ICO raise, will be well-equipped to survive the next few years.
Back to the topic at hand – Sparkster funding. So if they did not need to cash out any money from ICO to fund the project, then how were the 14+ employees/devs being paid for their 7+ months of hard work?
This picture says it all. You actually don’t need to read anything else from this article to make an informed decision about Sparkster; all you have to do is see this picture.
Sparkster is being funded by Saj himself. He didn’t need your funds for the past 7+ months, and he won’t need your funds for the foreseeable future either. He didn’t need an additional $30m to develop Sparkster, to market it to big enterprises, to hire new talent, to do anything really.
So why was an ICO made? You tell me.
Unsurprisingly, some community members are displeased at the misuse of raised funds. But Saj’s reason for not selling is a pretty interesting one:
Funnily enough, had the team actually sold off their raised ETH, I might’ve considered Sparkster to NOT be a scam.
Final
There are a lot, lot more red flags for Sparkster, however my willpower for exposing this ICO has been drained. I wrote this piece within the span of a few hours and am just scratching the surface. The Sparkster team can continue feeding the community lies about the level of development that’s occurring behind the scenes, but I can assure you, this cannot be sustained forever. With the help of Ian Balina, an ICO that most likely would've failed at the start has now turned into a public laughing-stock for all crypto investors to see. Ian has tried to sneakily slide out of the limelight that shines on his involvement with Sparkster, but in reality, no educated investor has forgotten what he's done for the team.
ALSO: The Sparkster team/Saj may attempt to shun this post by saying "oh, the messages were taken out of context!"... I encourage you to go back and search for all comments yourselves. Never trust one source, as I always say. You will then see the context with your own eyes.
By the way, according to the Sparkster code release announcement (https://steemit.com/sparkster/@sparkster/sparkster-releases-open-source-code):
"majority of our code has now been released"... that's unfortunate, I was expecting a lot more to come!
I’m getting absolutely nothing for writing this, but I hope that this has opened your eyes a bit into what’s actually going on. Never FOMO buy into a project just because your favorite ICO “reviewer” is praising it endlessly. Always do your own research – this can’t be stressed enough.
