hear no evil, Celo evil, back no evil

Hey look, the backstory for the “Kickstarter is going to start doing…something…on the Celo blockchain” announcement has finally been dug up: They got $100 million from Andreessen Horowitz to say they were moving to Celo.

Guess what blockchain that firm also invests in!

Did you guess Celo?

Wow, it’s almost like crypto has a pattern of pump-and-dumps that all work the same way.

And it gets better: “The deal didn’t require Kickstarter to follow through on the pivot.” They never needed to have a blockchain plan, much less accomplish the blockchain plan. They just needed to say they were doing a blockchain plan.

(please enjoy this bot’s idea of what “Man with a bag of money sliding down a blockchain” would look like)

A caveat: I appreciate all the hard financial details in that article I linked, but the POV of the authors includes some weird biases. For instance, they still swallow the idea that a blockchain, “with its traceable addresses and transaction history, could help solve the platform’s difficulties with fraud and trust”,

Kickstarter doesn’t transfer funds to random, anonymous, untraceable people. If you want to launch a project, they get your legal ID and your bank details. Those are extremely traceable!

And all the transactions on KS are accurately recorded already. Pledges are not getting secretly edited behind your back. That’s not where the fraud comes in!

“Putting the transaction records on a different type of database” does nothing to stop a project creator from pretending they plan to make a comic/movie/widget/etc, and then turning around and using the funds to buy themselves a house.

Or from having sincere, genuine ambitions to make the comic/movie/widget/etc they promised, but in practice, they’ve bitten off more than they can chew.

Or from sincerely working on the project, only to get tempted to use a bit of the money for some other bill…the dog got sick, they needed a new part for the car, a pipe burst in the bathroom, they were a tiny bit short on the rent this month…and they blow through all the pledges before they get around to paying the project bills.

Or, to use one of the actual fraudsters mentioned in this article, “raising money for turtle conservation charities only to turn around and blow it on crypto.”

The crypto fraudster, by the way, was investigated, taken to court, and sanctioned: “Under a settlement, Darling has agreed to provide restitution to supporters, to pay civil penalties and to not engage in additional crowdfunding campaigns in Ohio for at least five years.”

I’m sure the investigation process was long and complicated…but I can guarantee you that “tracing the guy’s legal ID, and having accurate records of who he owed refunds to” was not the hard part.