Crouching Tiger, Hidden Dragon — why are blockchain startups hiding?
‘Getting information off the internet is like taking a drink from a fire hydrant’
Mitchell Kapor
Well, there is some truth to that. And in this case I’m talking about tokens built on top of Ethereum. As at Trivial we are building an Ethereum blockchain interface where we enable users to check their tokens and transactions my team set itself a task — to research 610 tokens available on EtherDelta (the choice of ED was purely discretionary — as it’s a popular exchange we thought the tokens traded there will be the ‘popular’ ones people search for). And after dividing it equally and researching 150 tokens/projects myself, I want to share some of my frustrations with you.
Let us find the people behind the token
In my recent article on fundamentals of investing in crypto I put the team as the first signal to look out for. I even wrote ‘Check whether they exist.’ And some people laughed about it.
But the truth is there is nothing to laugh about.
Many of the projects I researched did not have a team listed on the website. And out of 610 projects we looked into only 147 had LinkedIn company profile. What’s even more interesting, some of those 147 did have a LinkedIn profile of the company but no one was working in it so founders could not be found on LinkedIn. In some other cases what was interesting is that some founders didn’t list assumably their companies as places they work in. So no link between the person or the company (apart from the website) could be found. That doesn’t look good.
Dear token creators, I like you to put your faces on the website, with your names, positions and links to your LinkedIn profiles (for the sake of the community and more importantly, for the sake of your projects) . And I know not everyone wants to reveal their identity (as in the case of Trivial’s mysterious developer) but if the founders don’t want to do that — there is something wrong in here.
Let us find information on the project
Trivial’s team really focused on getting the information which is available and putting it in one place so when you research a token you can find all the necessary information in one place (you can check for yourself here).
But doing that wasn’t easy.
Many projects don’t provide users basic information. One thing is giving a short explanation what the project does somewhere on the website (many times to find a concise explanation we had to go to Twitter for a description). Another thing is the whitepaper — that’s THE document everyone is looking for when researching a new coin/token. And many times it was neither not easy to find on the website nor was it there all together (then it could be sometimes found on Github — and Github itself was rarely linked to the website which is incomprehensible even to me, a non-technical person). Out of 610 projects we went through only 321 had a whitepaper, amounting to only 52,6% which could mean that almost half of the projects are not even worth looking into.
And what about social media? We looked for Medium/blog, Twitter, Telegram, Facebook, any video channels (Youtube, Vimeo), Linkedin, Discord, Gitter, slack. What we found out is that Twitter is the most popular channel with 452/610 having an account. Of course we need to remember that not all of them are used. And another sad truth: Twitter followers are very easy to buy so when you check the project’s Twitter check the number but also several accounts following them. What surprised me is that Facebook was the second in the social media ranking (with 321/610) as it doesn’t seem a natural place to gather blockchain users to me. But I might be wrong. Next, we have Medium + own blogs with 231/Medium and 58 blogs, amounting to 289/610, 47% of the projects sharing updates and knowledge through articles. That’s what I really enjoy and appreciate in the community — that one can learn a lot by reading great content written by people working deep in the field.
- Twitter 452
- Facebook 321
- Medium 231 & 58 blog
And of course forums and discussion groups such as bitcointalk, reddit or Telegram play an important role in the blockchain space. We found 298 projects being mentioned on bitcointalk and 238 having their own subreddit. Whereas 299 projects have their own Telegram channels. That’s the channel that has been used by the industry for some time now as the messages are encrypted and their servers are distributed. A dream come true for cryptopunks. However, I’ve talked to several startups that gave up this communications channel as they said several people tried to impersonate their team members to swindle money out of the community. Similar with bitcointalk: the information could be provided by anyone as well as the subreddit might have been created by anyone. So one needs to be conscious of these problems. In any case, such forums play a relevant role in assessing the project — you’ll find lots of critics there. Because startups have the whole control over their website and social media they own you’ll find one-sided information there. On the forums you’ll be able to discuss your uncertainties with others (and possibly also with the team members).
- telegram 299
- bitcointalk 298
- subreddit 238
[For even more numbers you can jump to my team member’s Reddit post who put it all together]
Dear token creators, of course, we don’t expect your startups to have all of them (as it takes a lot of time and effort to keep track of them, be responsive and active), but if you do have them — please, please, please post them on the website. This way gathering information will be easier for the community AND you’ll make sure that those are the official ones (not fake ones that someone started to make your life difficult). Two birds with one stone.
Let us understand what’s the goal of the token & the project
In many cases (especially when the whitepaper was missing or was difficult to find) it was not that obvious what is the goal of the project and what is the goal of the token. Because those are two different things. If you want to create an esport platform where people pay to watch a game, do you really need your own token? What’s the rationale behind it? What’s the token’s design? Is the token in place just to create buzz or raise money (or both most probably)?
This is important especially for now. We still don’t know whether there is a point in producing utility tokens (or rather, there are more voices that there is no point to do that, and here is Vitalik’s voice). Or is the point of the coin just to raise money? Then, if tokens were to be similar to stocks, then the buyers need similar rights to stock holders and this would lead to equity tokens.
Dear token creators, please make sure to (first think of and then) explain the reason for the token to exist.
Why did we research so many tokens? We had to do to use all this content in our (beta) platform Trivial where users can get information about different coins/tokens.
TOKENS:
If you would like to check for example ZRX- 0x tokens you can do that here: https://trivial.co/t/0xe41d2489571d322189246dafa5ebde1f4699f498 (the number in the link is just a smart contract number of ZRX — you can check it with any different token on Ethereum blockchain). You can here also all top token holders of a particular token.
ACCOUNTS: If you would like to check the balance or tokens of any address — you can do that here: https://trivial.co/profile/XX — where XX is any account number.
HOLDERS: We added a feature where users could check exactly HOW MANY of tokens holders exist — so you can check how many tokens holders have this particular token (of course some of them are exchanges — we will mark exchanges as a next feature). You can check it here on a Neumark example: https://www.trivial.co/t/0xa823e6722006afe99e91c30ff5295052fe6b8e32.
Looking forward to your feedback (you can just post a comment here or e-mail us at support@trivial.co)!
As I started with a rather negative quote, I’d like to end with one giving hope. There is a lot of information out there about the blockchain, tokens, token economics, and one might feel overwhelmed or lost but:
‘True genius resides in the capacity for evaluation of uncertain, hazardous, and conflicting information’
Winston Churchill
About me: Co-founder & CEO of Trivial.co: Check anyone’s tokens & transactions. European lawyer by degree, briefly flirted with the corporate world and moved to the startup world to discover the world of digital health and now blockchain.
