High-Performance Blockchain (HPB) with a market cap of $5 million recently announced a new decentralized governance system on its network, where the community members would have a larger say in the governance process.
The firm released a statement saying,
“To better facilitate the long-term development of the HPB, the core team opened the road to organizational transformation and community governance in October.’
Although the official statement stated that the change is only to make the system more community-driven, the company's managing director, Danny R suggested otherwise. He stated that things are complex internally and the decision was only made because the co-founders have decided to abandon the project. He went on to reveal that the governance restructure was done solely by the company's Founder and CEO Xiaoming Wang.
Wang claimed that he is stepping down because the firm he founded is,
“no longer aligned with the organization’s strategy, use of funding, and manner of conduct.”
Danny also revealed that apart from the CEO, three other co-founders and almost half of the employees at HPB is abandoning the project. Even though these employees were offered to contribute to the project by becoming a community contributor all of them declined.
The revelations about co-founders abandoning the project also hampered the market value of the HPB project, where the token lost 50% of its market value. Many now are claiming that the change of governance model is only an exit scam.
HPB raised $2 million last year in an ICO, and like many other failed stories from the ICO era, it seems HPB will also turn out to be an exit scam. A recent study has found that 80% of the projects which raised money through ICO failed to deliver on their promise. Thus, the latest example of HPB must be an alarming Bell for both the customers and investors as well as regulators to closely monitor such projects with the potential to scam people of their hard-earned money.