Sadly, not all plants are meant to be, some just fail.
This one looks odd to me and I personally would not bother continuing with it. When growing, it pays to plant some extra/reserve seeds, just in case you need to replace a poor growing or mutated seedling, as not all seeds will produce good plants.
In future, fill your pots right up, dirt is cheap and the more soil, the more roots. The more roots, the more plant!
Also, by sitting so deep and low down in the pot, your seedling, especially when young, will not receive very much (reflected) side light, slowing growth.
Hope this helps, but I guess, not the best news.
Cheers, Organoman.