If you were a stock, how much would you be trading for?
This is the basic premise behind BitClout, the self-dubbed "Crypto Social Network." Their description:
Your favorite creator has a coin you can buy or sell. The price goes up as more people buy. You can have your own coin too.
The really interesting thing about BitClout is not its tech, or even really its design. Rather, it's the ingenious method they used to market it at launch.
Shaan Puri sums it up nicely:
So there you are, a moderately famous person of some kind. You see this thing called BitClout. And you are trading for $5,000 a coin! Ten percent of all that money attached to your name is waiting to be claimed by you. All you gotta do is send a single tweet to verify yourself.
A single tweet for thousands and thousands of dollars? Why not?
This has proven tempting enough for no small number of people to do, and as a result BitClout gets a ton of both traffic and credibility.
There's just one incy wincy problem with this whole thing: You CAN'T withdraw funds!
Consequently, lots of people are calling it a scam.
I think it depends on how you defined the word "scam."
BitClout is funded by some big names in crypto. According to TechCrunch, the platform had over $165 million invested into it at launch.
Imagine, for a moment, that you're a bigshot crypto investor. Your homie diamondhands (the alleged founder of this platform — yes, seriously), pitches his idea, and he wants you to invest a few million dollars.
Don't worry, he tells you. You'll make it back in a jiffy because we have this brilliant marketing ploy that will get famous people to tweet up a BitClout storm, and there will be a flood of investment as a result. You sell the coins that you boosted the value of ahead of time for a huge profit, then the platform runs itself.
You win. The famous peeeps win. We win. The investors, uh... well, who knows what will happen long-term. This idea is kind of crazy, yeah?
Hold on, you say. What if these famous people show up, tweet, claim the value of their coin that I funded, then just bail? I'd lose millions of dollars in the span of a few days or weeks.
No, no, don't worry, diamondhands assures you. We'll make it impossible for people to withdraw their money at first, lmao. And we won't make it possible to withdraw until all of our early investors have cashed out for a profit.
All right, let's click the Money Print button.
Is this how it went down? I have no idea. Just a guess.
I will say that a decentralized platform that allows ICO's at the click of a button is pretty cool, and that sort of thing could even replace stock exchanges some day. I don't think BitClout is that. But maybe it's a precursor.
Flip a coin. Heads, you'll 100x your investment. Tails, you get zero.
Is that a gamble you're willing to take? Only you know that.