Not sure this could really even be called a virtual theremin.
The main problem is the tone is not continuous. Look at actual theremins, or listen to them rather. The tone is perfectly continuous, not hopping around at discrete steps like this does.
When I drag from point A to point B I shouldn't get various discrete tones hopping to the next tone at certain points but instead it should be the full spectrum from point A to point B and perfectly continuous. The pops are awful but I don't think disqualifies it from being a theremin, but the lack of continuity does.
That and it probably would not be that hard to put a picture of a theremin and make more of a virtual theremin.