It's in a weird logistical state. I'll take a healthy chunk of the blame.
The TC audit project commissioned iSEC to do a formal code audit. That audit was completed professionally and efficiently. No smoking gun problems were found (several nits were, but nothing that would make it any easier to decide whether to trust the package).
That iSEC audit was the headline achievement for the project, so the fact that it was finished should reassure people worrying about whether the project did anything.
After the code audit, the project was supposed to move on to review the cryptography in TC. Which is where I come in.
Because the project was considering commissioning services from professional appsec firms, I recused myself from the project (at the time, I worked for a very large appsec firm). My feeling is that a better use of the TC project resources would be to set up some kind of crowdsourced audit slash bug bounty. When the code audit was completed, and after I had left Matasano, I volunteered to coordinate a crowdsourced crypto audit.
Unfortunately, I was also in the midst of starting a new company and recruiting cofounders and then the holidays hit and long story short things went off the rails.
There are two big paths forward for the TC project that I am aware of:
1. They can rekindle the crowdsourced crypto audit (I'd be happy to remain involved, or to talk to any other subject matter expert that wanted to do that job --- n.b., I was going to do the work gratis). If any kind of formal review of TC's cryptography is to be done, this is the way to do it; the project can't afford what it costs to retain professional cryptography engineers to review the code (real crypto security consulting costs a multiple of what appsec consulting does).
2. They can devote all the remaining funds to a public bug bounty for Truecrypt.
There may be options 3 or 4 that I'm not aware of. I have a decent relationship with Kenn and Matthew, but I have not been trying to keep myself in the loop on the project.
There you go: more than you wanted to know about the TC audit project!
None of it has much of anything to do with that weird announcement from last year.