CloakCoin: ‘We Had to Do Everything from Scratch, Only the Name Has Stuck’

[Original article from Cointelegraph Germany]

Cointelegraph spoke with Cloak team member Cashmen about overcoming the initial pump and dump by the original team, resurrecting CloakCoin, transitioning from proof-of-work mining to proof-of-stake, and its upcoming "PoSA3" release.

The Story of CloakCoin

In mid-2014, the first wave of cryptocurrencies similar to bitcoin but with improved anonymization features came on the market. CLOAK or CloakCoin, was one of the first and most promising projects. The price of cloak shot up reaching nearly US$6 million in market capitalization and a price of US$11.5 dollars per cloak.

What followed, however, was a sudden crash. There were rumours that one of the many "pump and dump" groups had driven up the price and then cashed out, crashing the market. The development team was also apparently unable to cope and finally announced in October 2014 that they were leaving the project completely.

A new team lead by the Bitcointalk user Cashmen ("c4shm3n") then took over the abandoned project. The coin languished for several months with a market cap of less than €30 thousand at times. In March 2015, a casual remark from a staff member of the Deep Web market "Evolution," whose leaders had made off ​​with more than 40,000 bitcoin, brought new attention to Cloak. 

When asked how users could prevent similar fraudulent events in the future, he said the answer was "Decentralized Market Fund projects: such as CloakCoin and their Market, they are the only way for this to work." 

Cointelegraph: Cloak has had a turbulent history. How long have you been in the Cloak project and how did you become involved?

Cashmen: I am in Cloak since the proof-of-work/mining phase ended. I invested approximately at the end of July 2014. I took over control of the Cloak project on October 14, 2014. Alty, the former leader, said that he did not want to continue the project and agreed to let me take it on. I, like many others, saw a lot of potential in Cloak and thought the ideas from the previous developers sounded very promising. That's why I made a significant investment in Cloak. 

When the pump and dump was over, my expensive cloaks had lost a tremendous amount of value. I contacted Alty and said that as a big investor, one of the last who has not yet sold off its credits, would like to take over the abandoned project.

CT: Do you have an IT background? Are you a programmer?

C: I got interested in Bitcoin soon after its inception and I’ve been involved with crypto since 2010. I mined my first bitcoins with a graphics card and have accumulated a lot of experience in the crypto field. Professionally, I'm not a programmer, but computers have always been a hobby of mine. I have previously worked actively with Quarkcoin and several other projects. In the crypto scene I am mainly known for my work with Quarkcoin. Since becoming in involved in Cloak, I have concentrated totally on CloakCoin, rather than QuarkCoin.

“[In] the Cloak community remained only those who knew nothing of the pump and dump scam.”

CT: You had to build a new team? What was it like and how many developers are now the core team on board?

C: The entire old team sold all their entire cloak and went to ShadowCash (SDC), including Alty, its biggest investors and Alty’s coder, who was a paid contractor rather than part of the Cloak team. 

Cloak never had its own coders before we took over. In the Cloak community remained only those who knew nothing of the pump and dump scam, like me, Indigo, our new chief developer, other team members and many other Cloak investors. 

Yes, I had to build a team. However, it was not difficult, as many were still keeping hold of their Cloak investment and were very keen to make up for their big losses. So we sat down with a few people and started planning how to make good on the promises made by Alty and the old team. Miraculously, it transpired that Indigo is an experienced and talented coder and he offered us his help to get the Cloak project off the ground again, and I got the old CloakCoin source code from Alty.

The source code was not as we expected, and to quote our recent announcement: 

"The previous team were kind enough to hand over the existing codebase and had created the impression that PoSA3 was already complete, and only [needed] a few tweaks and bug fixes. Many of you know that that was not the case!" 

We were told the PoSA3 project was complete, but this was not so. The code was messy, broken and incomplete. When I asked Alty about it, I never received an answer. He had said everything was almost done, but nothing was done, not even 10%. So we thought about it as a group for some time and came up with a plan to re-imagine a trustless, anonymous payment transfer system for cloak that would form the backbone of the new Cloak project and spent many months desi