Andrey Sergeenkov

In the crypto community, a prevailing myth has taken root — that success hinges on influencers, where buzz and follower-counts overshadow substance.&nbsp;



Tens of thousands of crypto projects claim they are striving for decentralization, yet they fiercely compete for the attention of influencers on centralized platforms. To me, this is the very definition of absurdity.



I’d like to challenge this influencer convention in crypto. Relying on influencers does more than just fall short of promoting true decentralization; it actively fosters a landscape where passive wealth accumulation is glorified and critical investment acumen is outsourced to those who may boast followers but lack financial wisdom.



This shift in focus is not merely a critique but a clarion call — urging the crypto community to wake up to the realities of a system that, under the guise of innovation, hinders the revolutionary potential of cryptocurrency.



The crypto community’s reliance on influencers has shaped the landscape of the crypto space significantly. This influence, while potent, often undermines crypto’s foundational principles by promoting a narrative of easy wealth and reliance on advice from non-experts.



Influencers build trust and credibility with their audiences by only <a href="https://medium.com/@FibonacciFiddsy/the-dirty-truth-about-crypto-influencers-the-real-scammers-b229a78f4ce8">showing</a> winning trades: This creates the illusion that the influencer is an expert trader with an impressive track record.&nbsp;



Many crypto influencers are also paid by projects to pump their low liquidity altcoins: They encourage their followers to invest, then dump the coins after the price spikes, profiting at the expense of their followers. The influencer appears correct in their recommendation, further solidifying trust, allowing the pump and dump cycle to continue with new coins. Followers buying late in the pump are often left holding worthless bags when the crypto eventually crashes.&nbsp;



By hiding paid promotions and early investment, influencers trick their audiences into buying while they dump their holdings.



A <a href="https://blogs.law.ox.ac.uk/oblb/blog-post/2023/11/crypto-influencers-give-poor-investment-advice-and-sec-taking-notice">study</a> highlighted by the Oxford Law Blog notes that, on average, following the advice of crypto influencers results in negative investment outcomes, with a worse financial outcome the more “expert” the advisor claims to be. This aligns with <a href="https://www.coindesk.com/policy/2023/04/20/us-sec-warns-advisers-they-need-to-know-crypto-before-recommending-to-clients/">concerns</a> raised by the Securities and Exchange Commission, which has warned advisers about the need for increased diligence when making crypto recommendations and emphasizing the importance of ensuring such advice aligns with clients&#8217; best interests​​.



Social media’s influence on crypto prices has been well-documented. Tweets from prominent figures like Elon Musk <a href="https://crypto.news/tweet-trend-and-trade-how-twitter-buzz-influences-crypto-prices/">have had</a> a direct impact on the market, with significant price shifts following notable tweets. This phenomenon underscores the market&#8217;s <a href="https://blockworks.co/news/elon-tweets-bitcoin-price-dips-again">sensitivity</a> to social media buzz and the potential for manipulation through these platforms​​.



Read more from our opinion section: <a href="https://blockworks.co/news/web3-falling-short-real-decentralization">Web3 keeps falling short of real decentralization</a>



Some may <a href="https://www.ftc.gov/news-events/news/press-releases/2023/03/ftc-issues-orders-social-media-video-streaming-platforms-regarding-efforts-address-surge-advertising">call out</a> social media platforms like X, YouTube, TikTok, Reddit and Facebook to better police misleading influencer content. However, strict moderation is unlikely as these influencers drive user engagement — which translates into profits for these platform’s owners. Influencers and social platforms operate in a symbiotic relationship where influencers draw in massive audiences, while platforms profit off the inflated traffic, ad revenue and data collection. With profits tied to the success of influencers, platforms seem to turn a blind eye.&nbsp;



The only way to weaken this deceitful system is to starve it — users must become savvier and simply tune out influencers altogether. An informed, skeptical audience that provides no traffic, no clicks and no ad revenue hits them where it hurts.&nbsp;



The trend of following influencer advice without adequate due diligence undermines the credibility and development of the crypto community. The importance of research and caution in crypto investment cannot be overstated.



Have we sacrificed our ideals for greed and vanity metrics? The promises of crypto must amount to more than individual wealth accrued through cunning tricks. True decentralization holds the hope of societal change — of shifting oppressive structures, expanding financial access and revolutionizing how humanity organizes and governs itself.



Read more from our opinion section: <a href="https://blockworks.co/news/crypto-subculture-x-reliance">If we want crypto to succeed, we’ve got to give X the boot</a>



As a community, we must grow up and take responsibility. No longer can we simply glorify passive wealth while compromising our principles. The time has come to build an ethical, transparent crypto ecosystem that realizes the vision that launched this revolution.



We must have the courage to create technologies, spaces and dialogues that reflect the more just world we wish to inhabit. Projects should embrace openness and community-centric development, ensuring they empower their users rather than centralized actors.



Investors must adopt critical thinking, comprehensive research and robust diligence — not impulse and hype — as the basis of decision making. And as participants, we should demand accountability and wisdom from leaders, not just viral tweets.



Our decentralized future requires both technological and cultural maturation. By building systems and spaces for ethical participation, the crypto community can fulfill the promise of a revolution that unites us in working towards the greater good.&nbsp;



This is a call for us to grow up and take responsibility — the promises of crypto are too important to leave to chance.



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<div class="wp-block-post-author-biography">Andrey Sergeenkov writes educational articles as a freelancer. His works have been published in Coindesk, Cointelegraph, Entrepreneur and CoinMarketCap. He believes that transforming society towards lifelong learning, combined with decentralization in government and business, will lead to exponential social development.</div>


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Crypto has an influencer problem

Michael McSweeney

X, formerly Twitter, has a deepfake problem, one that I believe could — and, frankly, should — end its role as the premier social platform for the crypto industry.



Scrolling through the endless chaos of X, it doesn’t take long to come across a video, usually starring a stilted Michael Saylor or Brad Garlinghouse, promising me access to a crypto airdrop. Solana co-founder Anatoly Yakovenko’s likeness has <a href="https://www.theverge.com/2024/1/3/24024262/youtube-twitter-x-crypto-solana-deepfake-scam">also been used</a>.&nbsp;



These videos are, of course, scams, putting a new and decidedly worrisome technology spin on an old problem —&nbsp;similar to the ever-prevailing threat of <a href="https://blockworks.co/news/crypto-phishing-attacks">crypto phishing attacks</a>.&nbsp;



The videos employ AI-generated voice recordings and what appear to be added lip animations to present “opportunities” to would-be crypto holders.&nbsp;



These “major announcements” share a common call to action: Scan a QR code or follow a link to receive “money.” Obviously, I didn’t click or scan by way through, but the implications are clear for anyone who has encountered the dangers of the modern internet. Interaction means security exposure, and exposure means the potential for stolen digital assets, personal information or more.&nbsp;



One account, live as of the time of writing, had scored 276,000 views for a Saylor deepfake and 139,000 views for a Garlinghouse deepfake. 



Read more from our opinion section: <a href="https://blockworks.co/news/farcaster-just-might-be-the-new-crypto-twitter">Farcaster just might be the new Crypto Twitter</a>



The fact that these posts are often tagged as advertisements —&nbsp;thereby offering them the veneer of legitimacy —&nbsp;is deeply problematic. Far worse is the reality that X is making money off the problem rather than making any kind of visible effort to confront them.



It wasn’t that long ago that X owner Elon Musk pledged to solve the spam bot problem. The reality seems to be that we’ve traded scam accounts that pretend to be Musk for scam accounts that act like crypto industry leaders — in both cases, enticing would-be victims with giveaways.



This is all playing out against the backdrop of <a href="https://www.theinformation.com/articles/musks-x-is-flooded-with-ad-spam-stolen-credit-cards-may-be-key">a wave of other types of spam advertisements</a>, as The Information detailed earlier this month. The result — fueled by an exodus of major advertisers that has slowly played out since Musk took over the now-former Twitter — is a minefield of questionable products, porn bots and these deep fake videos.



It’s a disaster. The situation further muddies the water of a platform that has, for many years, served as a central hub for inter-industry relations. And, if recent technology developments hold true, the problem will likely become worse over time.&nbsp;



News from Sam Altman’s OpenAI that the company has developed a text-to-video product may put additional tools in the hands of would-be scammers. To be sure, OpenAI appears to be taking an at least publicly cautious approach to allowing access to this tool, in what is doubtless an acknowledgement of the inherent risks. But AI-generated video tools will inevitably become widespread — opening the door to more sophisticated deep fakes like the crypto ones popping up today.



Where to from here? Should alternative social media platforms be embraced? Do crypto-enabled platforms and protocols like Lens or Farcaster hold the key to a social media without these scam videos?



I don’t know. I believe the industry should become louder about this issue — if, for nothing else, to perhaps prompt a response from X and Musk. Remember, the Musk bot issue did go away, but by all appearances the fundamental problem —&nbsp;fake accounts masquerading as sources of authority — has metastasized.&nbsp;



This situation places an industry long dogged by its worst impulses in close proximity with a dangerous collision of technology and exploitation. The crypto industry would be wise to confront it head-on.&nbsp;



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<div class="wp-block-post-author-biography">Michael McSweeney has worked in crypto media since 2014, including editorships at CoinDesk and The Block. In his spare time, he writes fiction and plays disc golf. Contact Michael at michael.mcsweeney@blockworks.co.</div>


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Crypto deepfakes prove that X is failing as an industry platform

Bessie Liu

Less than 24 hours following Jupiter’s much-anticipated airdrop, some critics are raising concerns about how the JUP token was launched.



Earlier this week, the Jupiter team outlined a comprehensive strategy that went beyond a simple token giveaway.&nbsp;



They aimed to use JUP as a cornerstone for DeFi 2.0, focusing on expansive growth, ecosystem initiatives and a governance model that would evolve to incorporate significant community decision-making.&nbsp;



Read more: <a href="https://blockworks.co/news/solana-based-token-launch">Solana-based Jupiter to launch token on Jan. 31</a>



Its &#8220;50/50 Tokenomics,&#8221; token minting ritual and cold wallet release conditions <a href="https://www.jupresear.ch/t/jup-the-genesis-post/478">demonstrated</a> an approach to managing token supply, distribution and security, ensuring long-term project sustainability and community involvement.



However, potential misunderstandings about the project&#8217;s intentions have led some to believe that the Jupiter team&#8217;s actions post-<a href="https://blockworks.co/tag/airdrop">airdrop</a> resembled aspects of a public sale.



A key issue raised by observers centers around the <a href="https://blockworks.co/tag/jupiter">Jupiter</a> team&#8217;s method of offering JUP on the open market, which they say has doubled as a capital-raising strategy. According to critics, this detail was not clearly communicated to those participating, leading to discussions about the level of transparency and the degree to which buyers were making informed decisions.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Lmao we literally bought into an OpenMarket sale for <a href="https://twitter.com/hashtag/JUP?src=hash&amp;ref_src=twsrc%5Etfw">#JUP</a>. Basically open market = fund raising Only that rather than buy the seed round / round a/b/c/etc we bought when it feaking IPO-ed on the stock market literally lmao holy shit wtf bbq <a href="https://t.co/RnpdLh0hiR">pic.twitter.com/RnpdLh0hiR</a>&mdash; Lord Ashdrake (@Lord_Ashdrake) <a href="https://twitter.com/Lord_Ashdrake/status/1752894684031008957?ref_src=twsrc%5Etfw">February 1, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



An X user that goes by the pseudonym 0x_Hammer <a href="https://twitter.com/0x_hammer/status/1752905999881748912?s=46">noted</a> in a tweet that the Jupiter team had put in “moon protection” on the JUP token launch so that prices could not exceed 0.70 until the team secured $100 million.&nbsp;



“People [are] participating in a sale without even realizing it,” 0x_Hammer wrote.&nbsp;



To address these concerns, meow, the founder of Jupiter, <a href="https://twitter.com/weremeow/status/1752954292313686178?s=46&amp;t=yjAdM2ddX0KgGQimu7jcDQ">wrote</a> in an X post that the team would have received more funds had they opted for an over-the-counter (OTC) deal or a regular initial DEX offering (IDO).&nbsp;



The reason they had launched their token in the way they did was to ensure that airdrop recipients would be able to sell into a massive pool, while prospective buyers would have the assurance that there would be a big enough pool to absorb selling pressure from airdrops.



“We, as a team, take on the risk that we have zero certainty about how much we will actually end up with because the community and those who have buyer remorse get first dibs,” meow wrote.



A crypto user that goes by the pseudonym GraffirapNFT <a href="https://twitter.com/GraffirapNFT/status/1752916637487866096">accused</a> the team of using the ICO to <a href="https://twitter.com/GraffirapNFT/status/1752916637487866096">drive</a> fake demand.&nbsp;



This claim, though, had already been clarified by the Jupiter team in an elaborate document <a href="https://www.jupresear.ch/t/jup-the-genesis-post/478">describing</a> the tokenomics of its token. The document addresses the in-and outflows of JUP tokens, where they would be stored and who would hold the tokens.&nbsp;



Read More: <a href="https://blockworks.co/news/jupiter-airdrop-tokenomics">Understanding Jupiter’s tokenomics ahead of its first airdrop</a>



Meow does <a href="https://twitter.com/weremeow/status/1752935949280190642">admit,</a> however, that the team had made mistakes in choosing the price range in which the token was launched.&nbsp;



Blockworks research analyst Ren Yu Kong noted that much of the criticism around the Jupiter airdrop has been unwarranted.



“Fundamentally, Jupiter set a price and a valuation that they were willing to launch at, in this case, $4 &#8211; $7 billion FDV. It&#8217;s no different to investment bankers setting an IPO price, which a company is willing to sell shares at,” Kong said.



He added, “No one is forcing participants to buy if they don&#8217;t like the valuation in the launch pool. Granted, maybe one would have preferred more free market price discovery, but that&#8217;s easier said than done.”



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Jupiter airdrop draws criticism, but support remains strong

Tim Haldorsson

For companies and projects building their brands in the throes of an unforgiving cryptocurrency bear market, the quest for success is a relentless uphill battle. But in this digital Wild West, one social media ecosystem has emerged as the linchpin holding it all together.&nbsp;



That platform is X —&nbsp;but to say that X is merely a social platform would be a grave understatement. It is the very lifeblood of crypto projects, and an indispensable tool for their continued survival.



X plays a pivotal role in shaping the destiny of crypto projects. Regardless of whatever changes it has undergone since its Twitter days, X still acts as the “ground zero” of innovation, trendsetting, community building and collaboration within the crypto ecosystem.



<h2 class="wp-block-heading">The nexus of crypto innovation</h2>



Close your eyes for a moment in a bustling marketplace. Instead of wares, though, people are exchanging ideas, and influence serves as a social currency. This, my friends, is an accurate metaphorical depiction of X.



It&#8217;s the place where projects find fertile ground to grow and flourish. What makes X unique is its ability to catalyze the development of new and existing crypto solutions. It’s a melting pot where ideas are conceived, refined and then unleashed into the world. Without X, most crypto projects would remain in the shadows, lacking the exposure and feedback crucial for their evolution.



Crypto projects aren&#8217;t just about developers and investors; they are about people. And people need a place to connect, share ideas and build something greater than themselves. X provides that place. It&#8217;s the virtual town square where crypto communities gather to celebrate successes, overcome challenges, brainstorm, and collectively drive projects forward.



Undoubtedly, community is the backbone of any successful crypto project. It stands to reason that building a strong and engaged community is not an option; it&#8217;s a prerequisite for success in the Web3 space. And when it comes to community building, X is the cornerstone.



In the world of crypto, trends can emerge and fade faster than a blockchain confirmation. X not only keeps up with this pace, but it also serves as a live feed, providing a real-time pulse of the crypto world. It is where the most impactful Web3 trends are birthed, nurtured by the collective consciousness of blockchain technology enthusiasts and early adopters.



The market watches closely because it knows that those who navigate X effectively are often the first to identify the next big thing, giving them a substantial advantage in the crypto arena.



Market sentiment is significantly influenced by the social dynamics of crypto sub-communities on X. A classic example is the rapid rise to popularity, circa 2021, of so-called “PFP projects” characterized by the communal culture of representing on-chain assets as profile pictures on X. The massive success of the earliest iterations of this species of crypto project spurred a year-long NFT market boom and birthed countless personal and corporate brands within the crypto space.



<h2 class="wp-block-heading">The duality of modern social media</h2>



Another interesting and important part of the crypto experience on X is — and I don’t say this lightly — the drama. It’s arguably one of the most compelling aspects of Web3. Your X timeline is the easiest place to keep tabs on the constant attention shift in the space: Everybody knows that if there’s something worth sharing in Web3, you’ll probably find it there first.



This comes with attendant risks, of course. In the past few months, threat actors have pulled off high-profile scams via SIM-swap cyberattacks on influential X accounts. Vitalik Buterin, the head honcho of the Ethereum blockchain was not spared. Neither was Michael Siebel, a partner at YCombinator, nor a multitude of other notable influencers.



Read the other side from our opinion section: <a href="https://blockworks.co/news/crypto-subculture-x-reliance">If we want crypto to succeed, we’ve got to give X the boot</a>



It’s a phenomenon that has drawn criticism from the cybersecurity community. Experts opine that X needs to implement more stringent security measures as a norm. Independent security researchers like the anonymous “zachXBT” have made a name for themselves by busting crypto scams.



But it must be noted that both the good and bad: the scams and scam busters, the public feuds and fellowship; they’re two sides of the same coin. Labelling the platform as inherently bad due to these flaws would be akin to blaming the messenger for bad news.



Although it is not a perfect media machine, X is truly a mirror of the contrast in the crypto industry. It’s an openly accessible arena where the endless struggle between positive and negative forces rages in full view of the public eye. And boy, are our eyes glued.



<h2 class="wp-block-heading">What about decentralized social media?</h2>



While X continues to dominate the scene, there&#8217;s a wave of Web3 social platforms like Mastodon, Phaver and Link3. They aim to decentralize the social media experience, bringing it closer to the ethos of Web3. However, it&#8217;s noteworthy that these platforms have found it challenging to gain traction outside of niche Web3 communities. X, on the other hand, continues to record massive growth due to its cultural relevance and wide accessibility.



SocialFi platforms are another breed, combining the interconnected nature of social media with financial incentives in a decentralized model. Projects like FriendTech, built on Ethereum, have successfully attracted creators from outside the Web3 niche. Stars Arena replicated this success on the Avalanche blockchain.



It&#8217;s important to note that these platforms are not without their vulnerabilities. Security breaches and million-dollar exploits are a huge turn off, and a number of such incidents permanently crippled the Stars Arena platform.



<h2 class="wp-block-heading">The lifeblood of crypto projects</h2>



So, why do crypto projects need X? Because without it, the crypto world would be a fragmented, disjointed space. For Web3 companies building in a bear market, survival is a matter of innovation, trendsetting, community building, and collaboration. Although it faces some competition in the form of SocialFi platforms and Web3 social media, these players are far from mainstream.



With undeniable cultural relevance proven over multiple market cycles, X has proved to be a magnetic force behind the crypto ecosystem, and any project aspiring to succeed in this industry cannot afford to be without it.



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<div class="wp-block-post-author-biography">Tim first stepped into the crypto world in 2017 and has never looked back since. Now CEO of crypto ecosystem growth agency Lunar Strategy, he’s contributed to a number of respected crypto publications and is always into talking about all things crypto.</div>


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Crypto without X? Consider it dead.

Jack Kubinec

Katherine Ross

If this isn’t the most crypto thing to happen to crypto on the eve of a potential spot bitcoin ETF decision…



The bitcoin ETFs were approved, a post by the official account of the Securities and Exchange Commission declared in an X post late Tuesday. The post, which included a screenshot of a quote from Chair <a href="https://blockworks.co/news/gary-gensler-before-etf-deadline">Gary Gensler</a>, was vague about the details of the approval.



Within minutes, however, it became apparent that the post — even though it had been sent by the SEC itself — was not authentic. The <a href="https://blockworks.co/news/bitcoin-etf-approval">SEC had not approved the ETFs</a> after all, with the agency declaring that its account was “compromised.” Speculation, however, has run rampant since the post was removed from the SEC account.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1176" height="874" src="https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=1024&amp;h=1024" alt="" class="wp-image-77375" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=1176 1176w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=346 346w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=351 351w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=295 295w, https://blockworks-co.imgix.net/wp-content/uploads/2024/01/image-30-1.png?w=80 80w" sizes="(max-width: 1176px) 100vw, 1176px" /></figure>



A decision on the ETFs was, prior to the post, expected by Wednesday of this week. The SEC has a deadline of Jan. 10 to make a decision on the proposed bitcoin ETF from Ark 21Shares.&nbsp;



Read more: <a href="https://blockworks.co/news/bitcoin-rallies-then-crashes-after-etf-approval-post-from-compromised-sec-account">Bitcoin rallies then crashes after ETF approval post from ‘compromised’ SEC account</a>



Crypto X (is that what we’re calling it now?) quickly uncovered one of the SEC’s own posts on the platform warning users to only trust the SEC’s account.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Careful what you read on the internet. The best source of information about the SEC is the SEC.&mdash; U.S. Securities and Exchange Commission (@SECGov) <a href="https://twitter.com/SECGov/status/1714020932509982771?ref_src=twsrc%5Etfw">October 16, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“Should have listened to the SEC about the SEC,” Bloomberg analyst James Seyffart <a href="https://twitter.com/JSeyff/status/1744837612144062873">quipped</a>.



An SEC spokesperson told Blockworks that, “The SEC&#8217;s @SECGov X/Twitter account has been compromised. The unauthorized tweet regarding bitcoin ETFs was not made by the SEC or its staff.”



Popular accounts among the crypto community on X were quick to point fingers — in jest, at least.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">leaked images of the sec account hacker <a href="https://t.co/JYyTF88JIZ">pic.twitter.com/JYyTF88JIZ</a>&mdash; Hsaka (@HsakaTrades) <a href="https://twitter.com/HsakaTrades/status/1744836001216831883?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Another user used the debacle to call back to another meme.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The SEC rn <a href="https://t.co/MzH07AiNXq">pic.twitter.com/MzH07AiNXq</a>&mdash; tweet davidson 🍞 (@andykreed) <a href="https://twitter.com/andykreed/status/1744840854643015723?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



In case this situation feels in any way familiar, a similar situation — mind you, not involving an official government account — happened earlier this year when Cointelegraph posted that the ETFs were given the green light by the SEC. (Narrator’s voice: the SEC had not, in fact, issued a decision on the proposals.)



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"><a href="https://t.co/7GLafyzjj5">pic.twitter.com/7GLafyzjj5</a>&mdash; laurence (@functi0nZer0) <a href="https://twitter.com/functi0nZer0/status/1744836353047580739?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Even Matt Hougan, chief investment officer at Bitwise, took to X following the compromised post. Bitwise is one of the 11 firms vying to launch a spot bitcoin ETF pending SEC approval (official approval, obviously).



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I didn&#39;t even have to write anything. <a href="https://t.co/NqXbVTStOo">pic.twitter.com/NqXbVTStOo</a>&mdash; Matt Hougan (@Matt_Hougan) <a href="https://twitter.com/Matt_Hougan/status/1744846857765888506?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Another user pointed out that the SEC did not seem to be using two-factor authentication for its account.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">OMG the SECGOV seriously isn&#39;t using any security for their account 🤯 Anyone want to take guesses at their email??? <a href="https://t.co/GK8h9FuVWF">pic.twitter.com/GK8h9FuVWF</a>&mdash; Captain_Plantain (@Cap_Plantain) <a href="https://twitter.com/Cap_Plantain/status/1744836685869789429?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



And, finally, a user offered a live look into the spot bitcoin ETF launches.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">LIVE VIEW OF SPOT BITCOIN ETF LAUNCH <a href="https://t.co/qNa6IuPbNf">pic.twitter.com/qNa6IuPbNf</a>&mdash; Genevieve Roch-Decter, CFA (@GRDecter) <a href="https://twitter.com/GRDecter/status/1744843006383911155?ref_src=twsrc%5Etfw">January 9, 2024</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



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Crypto community responds to fake ETF approval with memes and disbelief

Shalini Nagarajan

Social media platforms are quite powerful tools for predicting crypto prices, according to a recent study by finance professors and a PhD student at Pennsylvania State University. 



They found sentiment on social media significantly influences short-term crypto returns. Sentiment from the news media, however, barely moved the needle.



“The results … strongly support the hypothesis that sentiment extracted from social media predicts cryptocurrency returns, while sentiment derived from news media does not.”



Reflections laid out in the <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4495683" target="_blank" rel="noreferrer noopener">paper</a>, titled “An Anatomy of Cryptocurrency Sentiment,” show smaller cryptocurrencies — which don&#8217;t get as much media attention — are more influenced by the overall sentiment of the market, as filtered by social media.



“&#8230; We observe that both crypto specific and market-wide sentiments matter, but the predictive power of the latter is economically and statistically stronger,” they said.



“This finding may be counter-intuitive as it would be natural to expect that only sentiment tied to fundamental events would have predictive power, but it turns out that in the cryptocurrency market, sentiment, even when decoupled from fundamental events, does matter for returns.”



The study included 267 cryptocurrencies, excluding stablecoins, covering the period between Jan. 1, 2018 to April 4, 2021. Market caps for all tokens were under $1 million.



<h2 class="wp-block-heading">Emotions influence crypto prices</h2>



Anecdotal evidence cited for social media’s potential impact on crypto prices included Dogecoin’s 10,000% rally after a string of supportive tweets from Elon Musk and other celebrities in 2021.&nbsp;



Another incident was FTX&#8217;s token, FTT, <a href="https://blockworks.co/news/binance-is-buying-ftx-a-timeline-of-events" target="_blank" rel="noreferrer noopener">collapsing 70% in one day</a> after Binance CEO Changpeng Zhao tweeted that Binance would liquidate its holdings. FTX would declare bankruptcy only two weeks later.



In showing more scientific proof that social media sentiment was linked to crypto prices, the researchers noticed a trend: positive events like code updates, crypto adoption and innovation generally boost sentiment, while negative events like regulatory crackdowns or scams tend to dampen it.



Both social and news media generally expressed positive attitudes toward cryptocurrencies throughout the duration of the study, researchers said. The team used sentiment data from Refinitiv MarketPsych Analytics. 



Per the paper, social media discussions have a significant impact on shaping sentiment, with emotions influencing how people perceive cryptocurrency value, and thus, actual returns.



Unlike discussions and posts on social media, journalistic articles tend to provide more factual information and may appear less emotionally charged, they found.



Researchers wrote: “&#8230; While events that may be considered &#8216;fundamental&#8217; to cryptocurrency value, such as news on transaction speeds, code upgrades, anonymity, currency adoption, and technological innovations, impact market sentiment, they do not fully explain it.”



“Importantly, we observed that it is the unexplained sentiment, which we refer to as ‘exuberance,’ that consistently and significantly predicts cryptocurrency returns.”



Read more: <a href="https://blockworks.co/news/crypto-doesnt-care-about-fundamentals-is-that-sustainable" target="_blank" rel="noreferrer noopener">‘Crypto Doesn’t Care About Fundamentals.’ Is That Sustainable?</a>



<h2 class="wp-block-heading">‘Momentum’ strategy pays off when sentiment is high</h2>



The team studied daily returns of a long-short crypto portfolio with a holding horizon of one week.&nbsp;&nbsp;



By comparing data during periods of both positive and negative sentiment, it was possible to calculate the profitability of short-term “momentum” strategies based on social media chatter and the like. 



The momentum strategy effectively boiled down to quantifying market sentiment for individual cryptocurrencies and “longing the winners, shorting the losers.”



The researchers found that the momentum strategy wasn’t significantly profitable on average — but it was when market exuberance was high. And when market sentiment was low, the strategy wasn’t really effective.



Overall, increased crypto prices (or “perceived cryptocurrency value”) were associated with increased market exuberance.



“We conclude that market exuberance affects price perception and/or investors’ demand, thereby contributing to explaining momentum returns in the cryptocurrency space,” the researchers said.



“This finding suggests that market participants might be reacting to a general mood of optimism or pessimism, reflected in market exuberance, rather than reacting to any tangible changes in the fundamentals.”



Yale University academics recently <a href="https://blockworks.co/news/crypto-twitter-bots-returns" target="_blank" rel="noreferrer noopener">conducted a separate study</a> examining the influence of social media on crypto returns. Their research uncovered that crypto projects with a greater volume of posts from Twitter bots tended to have lower long-term returns.



David Canellis contributed reporting.



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Crypto prices predicted by social media sentiment more than headlines: Study

David Canellis

If you squint and turn your head a bit, crypto looks something like a protest movement.



<ul>
<li>Sick of banks exploiting your deposits for their own gain? Buy bitcoin.</li>



<li>Tired of overt financial surveillance? Buy monero.</li>



<li>Rather gamble on Binance than casino blackjack? Buy shiba inu.</li>
</ul>



Outside of passive-aggressive speculation crypto fans have few ways of effective protest, especially against this cycle’s No. 1 villain, SEC chair Gary Gensler.



Bagholder marches aren’t really a thing (yet). So, a Manhattan rally for those who bought the top on the SEC’s “<a href="https://blockworks.co/news/securities-bnb-sec-suits" target="_blank" rel="noreferrer noopener">crypto securities</a>” is out of the question.



Publicity stunts are also absent. Climate protestors throw <a href="https://www.theguardian.com/environment/2022/oct/14/just-stop-oil-activists-throw-soup-at-van-goghs-sunflowers" target="_blank" rel="noreferrer noopener">soup</a> on Van Goghs and <a href="https://www.pbs.org/newshour/arts/climate-activists-try-to-glue-themselves-to-famed-painting-the-scream" target="_blank" rel="noreferrer noopener">glue</a> themselves to The Scream, but you won’t catch a <a href="https://blockworks.co/price/matic" target="_blank" rel="noreferrer noopener">MATIC</a> maxi chaining his ankles to the Wall Street Bulls’ balls lest the SEC back off.



What about a protest vote? Favorable securities laws are the single issue that determines your vote in the next election. All sorts of moral hazards and miseries ensue, by way of grubby political pandering.



Throw money at PACs and <a href="https://blockworks.co/news/the-gop-also-got-millions-from-ftx-execs" target="_blank" rel="noreferrer noopener">Super PACs</a> working in mysterious ways to install crypto-friendly politicians, sure, but that can be expensive — and you won&#8217;t even get a volatile cryptocurrency in return. 



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I encourage all investors to educate themselves on how you conspired with the greatest scammer of our generation to give him a regulatory loophole <a href="https://t.co/XV25FBeLVm">pic.twitter.com/XV25FBeLVm</a>&mdash; Evan Van Ness (@evan_van_ness) <a href="https://twitter.com/evan_van_ness/status/1669740715050409989?ref_src=twsrc%5Etfw">June 16, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Ahhh I’m ratioinggggg</figcaption></figure>



Ratioing Gensler on Twitter is really all there is. It started out as a light ribbing. A few hundred more comments to likes — mostly in response to Robinhood’s payment-for-order-flow <a href="https://www.cnbc.com/2021/02/18/payment-for-order-flow-the-controversial-wall-street-practice-to-draw-scrutiny-at-robinhood-hearing.html" target="_blank" rel="noreferrer noopener">controversy</a> amid GameStop mania. 



XRP army rumblings, even, about <a href="https://blockworks.co/news/inside-ripple-defense-strategy" target="_blank" rel="noreferrer noopener">the Ripple case</a> and the <a href="https://blockworks.co/news/sec-hinman-eth-not-security" target="_blank" rel="noreferrer noopener">much-anticipated-and-now-released</a> Hinman documents.



In between, there were plenty of posts with more healthy ratios. His first post directly addressing crypto, in September 2021, was warmly received, in fact, scoring a 1:2 ratio (comments to likes).



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1184" height="992" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1024&amp;h=1024" alt="" class="wp-image-60639" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1184 1184w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=307 307w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=312 312w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=261 261w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=80 80w" sizes="(max-width: 1184px) 100vw, 1184px" /><figcaption class="wp-element-caption">Simpler times, when there was still hope</figcaption></figure>



All that had worn off about a year later, as the SEC ramped up its prosecution of major US players, <a href="https://blockworks.co/news/sec-sues-coinbase" target="_blank" rel="noreferrer noopener">namely Coinbase</a>. It’s only getting worse. 



These days, Gensler can’t post ELI5s about compound interest without being mercilessly trolled, with one such <a href="https://twitter.com/GaryGensler/status/1673707772712566784">tweet</a> facing a 5:1 ratio last week. 



Replies include: “Everyone would rather like to know ‘What is a security?” and “Can you please do a post on what a bad faith actor is?” as well as “I have a ‘compounding interest’ in the<a href="https://twitter.com/hashtag/FireGaryGensler?src=hashtag_click" target="_blank" rel="noreferrer noopener"> #FireGaryGensler</a> movement!”



<figure class="wp-block-image"><img decoding="async" src="https://lh4.googleusercontent.com/BBUN2Lpj4EwcS4BUMOysvw9TUuTOYRARbIC3GKQx7k2_yQhdNcbYRPLtvZ7eN5U17B8gSopT7cw48vx_is2YRGtNBHa_h92DcyMJE7Fu4heYhT9vaMOzt41ioLHjRxifdo4B5_YlZKNcLa7ItPEIzp0" alt=""/><figcaption class="wp-element-caption">Gensler ratios deteriorated after the Coinbase Lend Wells notice</figcaption></figure>



A recent <a href="https://twitter.com/GaryGensler/status/1667214976963039232" target="_blank" rel="noreferrer noopener">post</a> advising college students on summer holidays to consider the best ways to save money was hammered at more than 8:1. “Best advice for college grads: don’t take advice from Gary.” “Is this financial advice from Gary Gensler himself? SEC should sue him for this.” “Who bullied you at school?”



Certainly there have been <a href="https://www.nytimes.com/2002/11/06/business/sec-s-embattled-chief-resigns-in-wake-of-latest-political-storm.html" target="_blank" rel="noreferrer noopener">instances</a> in <a href="https://www.sechistorical.org/museum/galleries/rev/rev02a.php" target="_blank" rel="noreferrer noopener">history</a> where the SEC chair has been forced to resign for mild-to-medium corruption. Even fraud. Legitimate accusations against Gensler are however non-existent, more meme than reality.



(Blockworks opinion editor Molly Jane Zuckerman previously outlawed any more opinion pieces about Gensler. Luckily, she&#8217;s not here today.)



Read more: <a href="https://blockworks.co/news/gary-gensler-is-utterly-unimportant" target="_blank" rel="noreferrer noopener">Gary Gensler is utterly unimportant</a>



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Garrryyyy! What&#39;s good! Yo, still waiting to hear back from you about ALGO? Just need to know if you&#39;re still bullish on them? I mean you said that they could create Uber on top of It! You think that&#39;s still gonna happen or what?! Look forward to your thoughts G-Man! Much love ❤️&mdash; batz (@batzdu) <a href="https://twitter.com/batzdu/status/1667229733082243081?ref_src=twsrc%5Etfw">June 9, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Another tweet just said “ratio.”</figcaption></figure>



Fantastical headlines still fuel frothy expectations through less discerning audiences that Gensler may well be moved on from his post.&nbsp;



A rumor that Gensler was ready to resign, fanned by an AI-generated blog last week, quickly triggered an SEC denial through a Fox News <a href="https://twitter.com/CGasparino/status/1675650578657992704" target="_blank" rel="noreferrer noopener">reporter</a>.



Industry lobby groups are lending legitimacy to the rabble-rousers, after two House Republicans <a href="https://blockworks.co/news/republicans-oust-gensler-bill" target="_blank" rel="noreferrer noopener">cleared a warpath</a>. The Blockchain Association (BA) in a fiery statement last week demanded Gensler recuse himself from all matters digital asset, on account of his opinion that bitcoin is the only kosher crypto clouds his judgment.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1188" height="1246" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=1024&amp;h=1024" alt="" class="wp-image-60638" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=1188 1188w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=286 286w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=976 976w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=245 245w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=249 249w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=209 209w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=76 76w" sizes="(max-width: 1188px) 100vw, 1188px" /><figcaption class="wp-element-caption">The associated tweet from BA lawyer Jake Chervinsky boasted a dynamic 1:17 ratio</figcaption></figure>



Will Gensler, a Biden appointee, resign, embarrassed by non-stop boos of the digital swamp we call Crypto Twitter?&nbsp;



Probably not. Even if Donald Trump wins. The former President <a href="https://www.nbcnews.com/tech/tech-news/trump-says-he-s-not-fan-cryptocurrencies-n1029116" target="_blank" rel="noreferrer noopener">hates crypto</a> (and loves the US dollar), why would he install a sympathizer? 



Still, with no other recourse, ratioing Gensler on Twitter is all crypto has right now.



<hr class="wp-block-separator has-alpha-channel-opacity"/>


<div class="wp-block-post-author-biography">David is an Editor based in the Netherlands focused on data-driven journalism. Previously, he wrote for TheNextWeb&#8217;s crypto vertical before launching Protos in 2021. He&#8217;s a reformed hardline Bitcoiner passionate about permissionless and decentralized networks. Contact David at david@blockworks.co</div>


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Ratioing Gensler on Twitter is sadly crypto’s most powerful protest

Crypto projects with more posts from Twitter bots tend to have lower returns over the long-term, according to a study from two Yale University academics.



The researchers examined more than one million tweets about 48 different cryptocurrencies created between 2019 and 2021. All had a fundraising goal of more than $1 million via token sales.



Their study focused on projects including axie infinity (<a href="https://blockworks.co/price/axs" target="_blank" rel="noreferrer noopener">AXS</a>), cowswap (<a href="https://blockworks.co/price/cow">COW</a>) and polygon (<a href="https://blockworks.co/price/matic">MATIC</a>) leaving out bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) and ether (<a href="https://blockworks.co/price/eth">ETH</a>). All had a fundraising goal of more than $1 million via token sales.



A system to measure a so-called &#8220;engagement coefficient&#8221; quantified the level of interest and interaction displayed by social media users.



“Low engagement coefficients signal a lack of interest, while high engagement coefficients signal artificial activity which is likely from automated accounts known as bots,” Prof. Tauhid Zaman and PhD student Khizar Qureshi wrote in the <a href="https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0284501#references" target="_blank" rel="noreferrer noopener">paper</a>.



“We found that the [engagement coefficient] was correlated with the future returns of the cryptocurrencies, and was most predictive of short-term returns.”



If a cryptocurrency has a very low engagement coefficient, it means that people aren&#8217;t really interacting with posts about it. This shows a lack of interest, which usually results in low returns over a long time horizon, the study said.



To predict future performance, the researchers devised an investment strategy that weighted portfolios based on bot activity and engagement coefficient. The latter appears to have a bigger influence, they found, especially over the first month of a token’s life.



The researchers noted that people can create a bunch of bots and make them engage with posts about a cryptocurrency to make it seem like there&#8217;s a lot of hype around it. This is what usually happens in pump-and-dump schemes, they said.



&#8220;These findings suggest that long-term returns are less dependent on social media features than short-term returns.&#8221;



<h2 class="wp-block-heading">Tracking viral crypto bots to trade better</h2>



As part of the analysis, the team looked at social media posts from the first month of each crypto’s existence.&nbsp;



Out of its chosen tokens, the researchers identified krypto as the cryptocurrency with the most buzz, a token used for in-game purchases in NFT battle game Kryptobellion.&nbsp;



At first, krypto had good returns, hitting as high as 49% after two months. But then things went downhill, and its returns turned negative. &#8220;This is likely due to bots programmed to like and retweet any tweets about krypto,&#8221; they said.



After 12 months, some cryptocurrencies had returns of over 2,000%, and the top dog was Axie Infinity’s AXS with returns of more than 24,500%.&nbsp;



“Overall, our results show that one can use social media activity to predict the future performance of cryptocurrencies over longer time horizons than previously known (months versus hours or days),” the researchers said.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1490" height="936" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1024&amp;h=1024" alt="crypto twitter bot study returns" class="wp-image-59636" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1490 1490w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=409 409w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=415 415w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=349 349w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=80 80w" sizes="(max-width: 1490px) 100vw, 1490px" /><figcaption class="wp-element-caption">AXS sat around the middle of the pack in terms of engagement coefficient.</figcaption></figure>



They continued: “If it is truly the case that virality significantly drops after one month, investors can begin to exit their speculative positions, and potentially avoid the infamous ‘pump and dump.’ As their chosen cryptocurrency begins to lose engagement, their expected returns should be revised downward, which in turn should influence their investment decisions.”



Traders could even estimate engagement coefficients themselves using daily social media feeds for various cryptocurrencies to make short-term bets on the most “viral” tokens, the researchers posited.



There were concerns that the data could be skewed somewhat, considering some of the analysis covered a bull market when traders were more &#8220;risk-loving.&#8221; Still, the authors believe their social media engagement model is flexible, so it can work in all sorts of situations.



In the future, researchers could check if the model can predict other stuff like how well movies and TV shows do, sales of fashion items, who wins in political campaigns or even how cryptocurrencies with bigger market caps perform.



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Crypto returns are worse if Twitter bots drive engagement: Study

Blockchain data provider DeFi Llama has walked back claims about an internal conflict that led to the split of its website and Twitter handle.



0xngmi, a member of the project said to be responsible for 90% of DeFi Llama’s success, initially claimed on Twitter that the team was undergoing a “hostile takeover” as another member wanted to launch a token. Apparently, this was a move the rest of the team didn’t approve of.



But late on Monday, 0xngmi provided an update to say the <a href="https://twitter.com/0xngmi/status/1637425043482222599" target="_blank" rel="noreferrer noopener">argument</a> had been resolved, the fork had been canceled, and the website would continue to work on a single <a href="http://defillama.com/" target="_blank" rel="noreferrer noopener">domain</a>.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">For everybody who is asking: everything has been solved and all work will continue on <a href="https://t.co/8b11M6Yk9u">https://t.co/8b11M6Yk9u</a>, <a href="https://t.co/G0h4uBo2mL">https://t.co/G0h4uBo2mL</a> will just be redirecting there&mdash; 0xngmi (llamazip arc) (@0xngmi) <a href="https://twitter.com/0xngmi/status/1637955928887533570?ref_src=twsrc%5Etfw">March 20, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



DeFi Llama <a href="https://twitter.com/DefiLlama/status/1637910941550489605" target="_blank" rel="noreferrer noopener">confirmed</a> the development via Twitter, apologizing for “poor communication” and “misunderstanding within the team.” 



“We would like to put what happened behind us. There is no LLAMA token currently planned, and any airdrop will be discussed with the community, as every important decision is,” the project said.



“We will take steps to operate in a more transparent manner to ensure this doesn&#8217;t happen again.” It added that each arm of LlamaCorp would cooperate with the other.



The team caused quite a stir over the weekend after 0xngmi and another individual contributor Tendeeno openly indicated on Twitter that DeFi Llama’s co-founder 0xLLam4 didn’t care about the opinions of the rest of the team.



Tendeeno had said DeFi Llama was the most successful project under the LlamaCorp umbrella, which includes other services like DL News and LlamaPay. Developments surrounding the conflict have not affected DL News, and it continues to be business as usual at the new outlet, according to a person familiar with the matter.&nbsp;



However, DeFi Llama itself was not generating revenue, which is why the co-founder thought launching a token would solve this.&nbsp;



Tendeeno said the team didn’t want this because “the project’s value and reputation would be wrapped up in this token.” He further claimed that the co-founder behind the hostile takeover had not contributed any work to DeFi Llama and had not paid employee salaries.&nbsp;



DeFi Llama did not comment on the claims laid out in Tendeeno’s tweets.



Tendeeno added to the narrative late Monday, saying the team wants to move on without continuing the conversation publicly, “but rest assured everyone at DL is happy with the outcome.”



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DeFi Llama Quells Internal Squabbles, Scraps Token Launch Plans

Sebastian Sinclair

<div id="highlights-block_62676e04e4580" class="highlights">
 <ul>
 <li>SpaceX and Tesla CEO Elon Musk has reached a deal with Twitter&#8217;s board of directors to buy the platform</li>
 <li>The $44 billion deal is expected to close sometime this year, subject to the approval of Twitter&#8217;s shareholders</li>
 </ul>
 
</div>



Major social media platform Twitter said Monday it had entered into a definitive agreement to be acquired by an entity wholly owned by Elon Musk in a deal worth $44 billion.



Under the terms of the deal, Twitter shareholders are to receive&nbsp;$54.20 per share in cash for each share of Twitter common stock that they own, according to a <a href="https://www.prnewswire.com/news-releases/elon-musk-to-acquire-twitter-301532245.html" target="_blank" rel="noreferrer noopener">press release</a>.



The deal has been unanimously approved by Twitter&#8217;s Board of Directors and is expected to close sometime this year, subject to the approval of the platform&#8217;s stockholders.



Upon the deal&#8217;s completion, Twitter is expected to transition to a privately held company, ending its nine-year run as a publicly listed company on the New York Stock Exchange.



The buyout represents a 38% premium to Twitter&#8217;s closing stock price on April 1 — the final day Musk unveiled his 9% stake in the social media company.



Musk has secured&nbsp;$25.5 billion&nbsp;of fully committed debt and margin loan financing while providing an approximately&nbsp;$21.0 billion&nbsp;equity commitment, per the release.



A major platform for the crypto community, Twitter is often both been praised and reviled for its approach to content moderation, freedom of speech (or lack thereof) and user profile anonymity. 



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I hope that even my worst critics remain on Twitter, because that is what free speech means&mdash; Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1518623997054918657?ref_src=twsrc%5Etfw">April 25, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Musk — who is estimated to be worth upwards of $268 billion, according to <a href="https://www.forbes.com/profile/elon-musk/?sh=7f05142c7999" target="_blank" rel="noreferrer noopener">Forbes</a> — said he wanted to improve Twitter through the introduction of new features, provide an open-source algorithm for the platform and tackle its spambots.



&#8220;Free speech is the bedrock of a functioning democracy and Twitter is the digital town square where matters vital to the future of humanity are debated,&#8221; Musk said in the release.



There are also reportedly plans to turn the platform into a <a href="https://www.reuters.com/technology/exclusive-twitter-set-accept-musks-best-final-offer-sources-2022-04-25/" target="_blank" rel="noreferrer noopener">subscription-based model</a> to bolster revenue and recoup some of Musk&#8217;s initial investment, according to Reuters&#8217; reporting.



Whether that would appease the crypto community or drive users to seek alternatives remains to be seen. Musk, whose Twitter musings about crypto — <a href="https://twitter.com/elonmusk/status/1113009339743100929?s=20&amp;t=jrmg8dS0He5IpDA6OAx-UA" target="_blank" rel="noreferrer noopener">particularly Dogecoin</a> — have resulted in the wild oscillation in prices, is often viewed as both an inflammatory and influential figure within the community.



In January, Dogecoin payments on electric car company Tesla’s online shop <a href="https://cms.blockworks.co/tesla-launches-dogecoin-payments-in-online-shop-price-jumps-17/" target="_blank" rel="noreferrer noopener">went live</a>&nbsp;for select items. At the time, the price of Doge shot up more than 17% within a 24-hour period.



Following a purchase of $1.5 billion worth of bitcoin last year in March, Musk announced via Twitter that Tesla would be accepting bitcoin as payment for vehicles before reneging two months later, citing environmental concerns.



On both occasions, bitcoin&#8217;s price movements coincided closely with Musk&#8217;s announcements, gaining 48% and then subsequently shedding 40% two months later.



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