IOTA Being Shut Off Is the Latest Chapter in an Absurdist History

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We'd seen press releases about an "Official partnership" between the Germany-based IOTA Foundation and Microsoft, which the incumbent tech company later denied, as well as various universities.

The MIT Tech Review ran a scathing review of the IOTA protocol's insecurities, but plenty of other reputable institutions appeared to endorse the project by inviting the founders to speak about IOTA at academic and professional events.

Wall described this as the founding team, which launched the IOTA token in 2015, being "Very effective at pushing out news about 'partnerships.'".

Among technologists, the IOTA Foundation became known for scandalous emails in 2018 between IOTA Foundation co-founder David Sonstebo and Neha Narula of MIT's Digital Currency Initiative.

By 2019, members of the IOTA community earned a reputation for routinely harassing women security experts, like Open Privacy founder Sarah Jamie Lewis, who found flaws in IOTA research.

The IOTA Foundation turned off the coordinator node in February 2020 to stop an attacker from stealing funds from the foundation's wallet service for retail investors, highlighting the fundamental challenge of decentralizing a crypto project.

IOTA's Schiener said the vulnerability, which led to stolen funds from 50 IOTA holders, came from a botched integration job with the fiat-to-crypto broker MoonPay.

The hack came just days after another IOTA Foundation scandal, when co-founder Sergey Ivancheglo left the foundation and demanded 25 million IOTA tokens as his share of the project.

Schiener referred to the IOTA Foundation as "The brand which I single-handedly conceived" and that "Naturally" his former colleague will never "Own it [IOTA]" again.

Unlike the Ethereum Foundation, so far there aren't any clients using the IOTA protocol beyond research and pilots, which sometimes include patents.