Civil’s token sale fails to hit target. What now?
As Civil’s cryptocurrency token sale drew to a close on Monday, it seemed highly improbable the project would make its $8 million minimum target, and in fact it did not. Civil, which is building a blockchain-powered platform for independent journalism (and already hosts a number of newsrooms, including the Colorado Sun and Popula), missed the target by a wide margin, raising less than $2 million from a little over 600 people. But co-founder Matthew Iles said in a Medium post on Tuesday the project is going ahead with a modified token sale, one that will be “much simpler” than the original, which was widely criticized for being overly confusing.
“The CVL token sale didn’t succeed. We’re disappointed, but we’re as committed as ever to seeing Civil out in the world,” Iles wrote. “A new, much simpler token sale is in the works.” In the meantime, the existing newsrooms will continue to publish, thanks to $3.5 million in grants from ConsenSys, the blockchain developer and venture fund that is also an investor in Civil Media Co., the for-profit arm of the project. ConsenSys—founded by Joseph Lubin, a co-founder of Ethereum, the cryptocurrency Civil’s tokens are based on—wound up buying more than 80 percent of the tokens that were sold in the latest offering.
Existing buyers now have the option of asking for an immediate refund of the money they used to buy tokens, getting an automatic refund on October 29, or retaining the tokens and remaining part of the Civil funding drive. Some token holders had already asked to exercise the latter option, Iles wrote. “I write to ask if you can ensure I do not get a refund after Monday’s ICO closing date irrespective of the outcome,” Iles quoted one token holder as saying. “I wish my funds/pledge to be redirected into any future CIVIL plans once announced.”
So what went wrong with the token sale? Overly ambitious goals given the current state of the cryptocurrency market—which some believe is a bubble—combined with what even some Civil staffers have told CJR was an overly time-consuming process of buying the tokens. To the usual virtual wallet and token exchange, Civil added a quiz on some of the finer points of cryptocurrency (such as the difference between a “hot” and “cold” crypto wallet). In part, Civil says this was done to weed out speculators and others who might not be in sync with the goals of the project. But those methods also seem to have weeded out a lot of potential supporters.
By the time the company decided to allow purchasers to use “fiat” currency (i.e., US dollars) sent directly from their bank accounts, it was too late. Yesterday, after the failed token sale, Civil staffers remained determined to raise money to operate the platform and to fund the Civil Foundation, a non-profit that also administers the Civil Council. The question is: Will there be enough interest in helping, now the first attempt at funding has failed so publicly?
More information on Civil:
- A new media ecosystem: For an in-depth look at what Civil is trying to build and why, see CJR’s feature on the project, based on interviews with all of the founders and senior executives, including Matthew Iles and Vivian Schiller, a former senior executive with Twitter and NPR who is now running the Civil Foundation.
- Confusing and time-consuming: John Keefe, a developer with Quartz, wrote a piece for the NiemanLab in which he described the 44-step process he had to go through in order to buy Civil tokens, including uploading a copy of his driver’s license and passport to verify his identity and filling out the quiz on cryptocurrency.
- A new constitution: One of the key documents in the Civil ecosystem is the Constitution, which the project has been crowdsourcing via an open Google Doc, as well as asking for input from media professionals in a series of symposiums both in the US and a number of other countries.
- A council of advisers: Part of the non-profit Civil Foundation is the Civil Council, a group of media experts including Emily Bell, director of the Tow Center for Digital Journalism at Columbia, law professor Ellen Goodman, Atlantic magazine Executive Editor Matt Thompson, and former Wikimedia Executive Director Sue Gardner.
- Also a movie studio: In addition to Civil’s blockchain-powered platform for journalism, the company has also launched a number of other ventures, including Civil Studios, which it said will produce original content, including documentaries and podcasts.
Other notable stories:
- A study of “news deserts” by the University of North Carolina’s School of Media and Journalism shows more than 1,300 communities across the US have virtually no local news coverage to speak of, having lost their newspapers. More than 2,000 counties now have no daily newspaper and 171 have no newspaper at all.
- Shelley Hepworth writes for CJR about the crisis at the Australian Broadcasting Corporation, that country’s public broadcaster, where the former managing director was fired halfway through her five-year term, after the chairman of the ABC board tried to pressure her to fire one of her reporters.
- Lesley Stahl, a veteran of the CBS news show 60 Minutes, said earlier this year that Donald Trump told her he uses the term “fake news” to discredit journalists he disagrees with. And yet she let him do exactly that in a recent interview without challenging him, says The Intercept’s Mehdi Hasan.
- Twitter has suspended about 1,500 accounts that were either created by or are associated with a troll campaign that started on the site 4chan, according to The New York Times. The accounts were fabricated to look like liberal and Democrat activists and spread misinformation about the midterm elections.
- James Wolfe, a former senior staffer with the Senate Intelligence Committee, pleaded guilty to lying about sharing information with reporters. Wolfe admitted he lied to the FBI about exchanging information with Ali Watkins, who was then at BuzzFeed and is now a reporter for The New York Times.
- Facebook told TechCrunch it will start down-ranking sites that scrape content or republish stories with little or no modification. Such sites will show up less prominently in the News Feed, the company said. Facebook also recently said it will remove posts that contain misinformation about voting.
- Democratic Senator Heidi Heitkamp apologized Tuesday for a newspaper ad she published that included the names of a number of sexual abuse victims. Heitkamp said she found out later some of the victims did not agree to have their names used, and some of those named were not actually victims of abuse.
Newsgeist un-conference: Facebook faces the music, sort of
Newsgeist, which was held this past weekend in Phoenix, is an unusual animal. It’s invitation-only, co-sponsored by Google and the Knight Foundation (which helps fund CJR), and aimed at bringing journalists and academics and others involved in media together for an “un-conference.” That means there aren’t any sessions organized in advance: Attendees put their suggested topics […]
What happens if Civil’s token financing doesn’t work?
Civil, which is simultaneously trying to create an open platform for journalism managed by its members (via a crowdsourced constitution) and launching a new cryptocurrency to help fund and operate the platform, is one of the most ambitious media experiments in recent memory. The cryptocurrency is a branded form of Ethereum tokens that Civil started offering to potential backers […]
Do journalists pay too much attention to Twitter?
Twitter may not have the same globe-spanning reach as Facebook, but one group of professional users has adopted it en masse: journalists. The lure of an always-on, news-heavy social network that includes access not just to an audience of consumers but direct input from newsmakers like Donald Trump is impossible to resist for many in […]
Smaller outlets reduce, scrap Facebook promotion over new ad rules
When Facebook announced in April that it would create a public database of political advertising, it seemed like a meaningful step—something that might make it harder for Russian trolls and other bad actors to try to manipulate public opinion using the company’s self-serve ad platform. But it soon became obvious the move would cause problems […]
Are we all suffering from data breach fatigue?
Personal information from tens of millions of Facebook accounts is exposed and used for unknown purposes, due to a series of complicated events involving the social network’s data policies, the details of which remain unclear. Sound familiar? That’s because it could describe a number of similar events in recent memory, including the Cambridge Analytica debacle […]
Google’s new hands-off approach to AMP fails to satisfy its critics
Unless you’re a web geek, you might not be that familiar with Google AMP. Short for “Accelerated Mobile Pages,” it’s a webpage standard developed by Google to speed up load-time on mobile devices by stripping out a lot of the bits (including a lot of advertising gimmicks) that tend to clog things up. At first […]
Zuckerberg’s death grip on Instagram
Alongside the continued “will he, won’t he” news about both Rod Rosenstein and Brett Kavanaugh, the hot topic in the world of digital media on Tuesday was the sudden departure of Instagram co-founders Kevin Systrom and Mike Krieger. We know the departure was sudden because Facebook—which bought the image-sharing startup in 2012 for $1 billion—seemed […]
A master class in how to verify a video using digital tools
Digital media has made it easier than ever for malicious actors to distribute fake news, including video, but at the same time, it has also made it easier for journalists to debunk or verify that news using tools like Google Earth. The BBC’s Africa bureau provided a real-life lesson in how to do just that […]
Mic looking for investors amid cash woes
Mic.com, the one-time digital media star, has recently held two board meetings, including one last week, to discuss the need to find a strategic investor amid an urgent cash crash at the company, according to multiple people familiar with the conversations who say the possibility of a shutdown was part of the discussions. In an […]
Is the podcast bubble bursting?
Podcasting was supposed to be one of the saviors of digital media—inexpensive, addicting, profitable, and popular. But now it’s like the old line from baseball legend Yogi Berra: “That place is so popular, no one goes there any more.” Panoply, the podcasting unit set up by Slate magazine, recently laid off most of its staff […]
The Weekly Standard and the flaws in Facebook’s fact-checking program
When Facebook announced in 2016 its plans to outsource fact-checking to a group of third-party specialists, even some critics gave the company credit for trying to help solve the misinformation or fake news problem. But in its efforts to appear as politically neutral as possible, Facebook set a trap for itself, and that trap was […]
Most Americans say they have lost trust in the media
The results of a new Knight Foundation and Gallup poll released on Tuesday won’t come as a huge surprise to most journalists: Trust in the media is down. Again. A majority of those who were surveyed said they had lost trust in the media in recent years, and more than 30 percent of those who […]
Sandberg, Dorsey avoid obvious question in hearing: What took so long?
Compared to some congressional hearings, the latest open session of the Senate intelligence committee looking into the use of social networks as a platform for disinformation—the fourth in a series—was a mostly sedate affair. No one trotted out poster boards with examples of ads bought by a Russian “troll factory,” as they did at the hearings last November, […]
Facebook now linked to violence in the Philippines, Libya, Germany, Myanmar, and India
The connection between Facebook and the US election may get the bulk of the media’s attention when it comes to the social network’s misinformation problem, but the issue is even more of an immediate danger in other countries. Among the most recent examples is the Philippines, where president Rodrigo Duterte and his supporters have apparently […]
Does a ‘universal attention token’ sound good? Then you’re going to love the blockchain
If you’re already confused about what a “blockchain” is, or how it works, and what role you might play in a media industry powered by cryptocurrencies (whatever those are), then a new proposal that would use the blockchain to reengineer the advertising business might not be your cup of tea. A company called SocialFlow, however, […]