It is working fine for me under Java 7u51 and 8b129.
Are you sure that you are doing a clean install?
Are you sure that it is running the version of Java that you think it is?
What OS?
I have a local git directory:
git pull
ant clean installg
cd ../releases/orientdb-community-1.7-rc2-SNAPSHOT/bin
./server.sh
In another console in the same directory:
./console.sh
orientdb> connect remote:localhost/GratefulDeadConcerts admin admin
Connecting to database [remote:localhost/GratefulDeadConcerts] with user
'admin'...OK
orientdb {GratefulDeadConcerts}>
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