Despite launching with considerable fanfare in early 2019, grin, the first cryptocurrency to test privacy protocol MimbleWimble, is showing no signs of life. 

At its launch, professional investors poured funding — by some estimates, $100 million — into mining the cryptocurrency, with some even calling it a sort of “Bitcoin 2.0”. 

Privacy without sacrificing scalability is the primary advantage of MimbleWimble, according to grin developers. The first grin coins were also issued via a so-called “fair launch” whereby, similar to bitcoin, all coins are minted by miners instead of being generated prior to the network going live. 

See also: Electric Coin Company SDK Paves Way for Shielded Zcash Payments on Mobile

“Grin was probably the most crowded venture capital trade of 2019,” said Ryan Gentry, lead analyst at Multicoin Capital.

On-chain data suggests once-eager investors soured on the young cryptocurrency. Grin’s hash power, a measure of computing resources devoted to securing the network, and mining difficulty, which gauges the amount of power required to mine, started to collapse in August 2019. After nine consecutive months of decline, the trend shows no sign of reversing.

Grin’s planned hard forks, or systemwide upgrades, could also be responsible for its declining network activity. Every six months, the network executes these upgrades that change grin's mining algorithm to deter expensive, specialized mining equipment from dominating its hash power. 

After the first fork, grin’s hashrate and difficulty climbed, but the second fork coincided with the steepest hashrate decline in the network’s short history. Grin is preparing for yet another drop in hashrate after a third next fork scheduled for July. 

See also: Monero’s ‘Fluffypony’ Steps Down as Lead Maintainer of Privacy Coin Project

Even grin’s transaction count, a metric that could be easily manipulated to mask the network’s declining use, has dropped roughly 20% year to date, according to Coin Metrics. This smaller drop follows a more than 70% decrease in daily transactions through February and March 2019. 

Grin developers say the cryptocurrency isn’t designed to cater to short-term speculative investors.

“Cryptocurrency is mostly a speculation game,” said grin developer John Tromp. “Grin is hurt in the short term by being speculation-unfriendly.”

Adding to grin’s woes, San Francisco-based Dragonfly Capital published research six months ago describing an “attack” that could reveal the identities of 96% of active grin users.

To date, the grin team has not fixed the vulnerability.

Ivan Bogatyy, who wrote the report, said grin’s core developers are “among the strongest engineers in the space.” However, they “faced a very hard cold-start problem with incumbents" such as monero (XMR) and zcash (ZEC) due to grin’s lack of “a robust privacy mechanism” to challenge leading privacy cryptocurrencies.

According to the people behind grin, Bogatyy’s report contains “many logical leaps” and the anonymity exploit is a known and “well-documented” problem.

Traders also seemed to have lost interest in grin. Since last June, the privacy currency’s price — quoted in dollars and bitcoin — has only dropped. 

When it first launched, for example, New York City-based crypto fund Iterative Capital briefly supported grin on its over-the-counter trading desk and considered mining. But it didn’t take long for the firm to lose interest.

“Buying demand was so low and the technology was in such an incipient form that we quickly stopped bothering,” said Iterative Capital’s founder and managing partner Chris Dannen.

Grin launched during an “altcoin bear market,” said grin developer David Burkett. That the price has “so far only moved downward” is a “very similar movement to many coins launched at the same time.”

Every new cryptocurrency struggles to gain adoption early on. But for the privacy currency that promised to be the next big thing, replacing speculators with real users has proven to be an uphill battle.