Open source is tough, even as a successful VC funded company. Gotta give credit to CoreOS though, rather than beating a dead horse they're acknowledging there's little external interest and their time would be better spent focused elsewhere. Seeing as they've discontinued Fleet as well it's likely they're doubling down on the commercial Tectonic product built on kubernetes. There's also likely pressure from their investors to start making money, especially as they're well into using their series B and might want to look to raise more money.
Distributed file storage is a tough market in itself. Developers get excited about technology but how many need this as opposed to a highly available database? I love the building blocks of distributed systems and understand that Google's technology is built on a layering of tech (Colossus, Spanner, etc) but it seems the world is not yet ready. Everyone is already struggling to understand the complexities of this new ecosystem and how the pieces all fit together.
Again, good move by CoreOS, wish them luck with their commercial strategy.