Selling Your Soul In The Era of Social Degradation
Wanna buy a share of your friend's Twitter profile? There's an app for that!
Here’s a question: is crypto filled with scammers or is it just that the world is filled with scammers and they use the tools at their disposal to scam others? It would obviously be easy to point to certain sh!tcoins and crypto protocols *cough Worldcoin cough* and call out the blatant grifts. But how does one find the line between what could be a legitimate project and what might be more of a hype-fueled cash grab/Ponzi of some sort? It’s not as easy as it seems.
After studying countless coins, protocols, and blockchain networks over the last several years, I’ve admittedly become jaded on the industry’s constant appetite for “the next thing.” Especially when that thing has already been done…. more than once. This morning, Seeking Alpha published my latest article on Coinbase COIN 0.00%↑: the focus of the article is Coinbase’s new Layer 2 Ethereum scaling chain called “Base.”
The article has charts like the one above showing how quickly Base has been generating fees from transactions since its launch a few weeks ago. As Coinbase is the only sequencer, Base is potentially a revenue booster for the company and that was the main thesis of the article. However, what I didn’t really touch on in that piece is what is actually driving the transactions on Base.
For that, we must examine Friend.tech - but first, let’s touch on a critical concept.
The Underlying Issue
There are common themes that can be found throughout the entire crypto/blockchain ecosystem. As I see it, what these coins/assets/chains are fundamentally trying to fix is a perceived imbalance in value return between producers and gatekeepers. And the reason for that misalignment is because the internet hasn’t historically had payment rails built natively even though the technology to do so has existed since at least the late 1980’s when David Chaum launched DigiCash.
But you can go down the list of things that I’ve covered here on Heretic Speculator over the last couple years, the origin stories are all very similar:
Bitcoin exists because central banks and governments have siphoned value away from the populace
Brave Browser & BAT Token exist because Google GOOG 0.00%↑ and Meta Platforms META 0.00%↑ have siphoned value away from publishers
Music NFTs and Audius exist because record companies and platforms like Spotify SPOT 0.00%↑ or Apple Music AAPL 0.00%↑ have siphoned value away from most independent musicians
Then there’s social media… where do we even begin…
Go down the list, the incentive structures have been largely out of whack and that’s the problem in a nutshell.
tOkeNiZE yOUr sOuL
For social media specifically, we’ve seen how users on the various platforms are able to grow large followings through an engagement model that generally incentivizes cheap thrills more than thought-provoking material. There are several platforms that are trying to combat that. Some are “Web2” based (Substack) and some are “Web3” based (Paragraph/Mirror). Some take more of the “busker” route and prioritize tipping, while others aim to financialize engagement. Those two things may look the same but there’s a subtle difference.
When a listener boosts a podcast with sats through a platform like Fountain.fm or a reader tips ETH through Publish0x, those are the busker variety platforms. It’s simple value for value. But when someone starts buying “shares” in a content creator, that’s a little bit different. That’s what Friend.tech is and we’ve already seen that strategy attempted in crypto before through the recently defunct Rally.io (RLY-USD) and to a lesser degree with the DeSo blockchain (DESO-USD).
However, unlike DeSo, which is attempting to be more of an all encompassing creator economy that offers both content tipping and profile financialization that directly competes with something like Twitter X, Friend.tech appears to be an overt speculative engine for gambling on Twitter X influencer popularity. There’s admittedly a similarity to speculating on musicians through NFT purchases (as I have done), but there is at least a useful product being sold via the NFT. Friend.tech skews a little too much to blatant cash grab to me.
Of course, the platform’s owners take an enormous cut of all of this speculative action and the rationale for buying a creator “share” is for access to private communication with that creator. So far, Friend.tech has generated about $65 million in trading volume from over 94k users on the Base blockchain network:
Want exclusive access to Crypto Twitter power user Cobie? What’s it worth to you? Who cares?! Someone else will surely pay more for that access later! All of this reminds me of the classic Simpsons episode Bart Sells His Soul (Season 7, Episode 4) when Bart trades a paper version of his soul to Milhouse for $5 and then strange things start happening to him.
Religious-skeptic Lisa, of all people, is the one who talks some sense into her older brother and even ultimately tracks down Bart’s paper soul derivative and buys it back for him.
Whether or not the soul is physically real, Bart, it’s the symbol of everything fine inside us. - Lisa Simpson
For better or worse, that’s what I think about when I see what is currently happening with Friend.tech. It strikes me as yet another symptom of a society that is in the late stages of total degradation. Judgmental? Probably. It’s just my opinion, which you don’t have to personally value.
But There is Hope…
Simultaneously, we have the awesome story of Christopher Lunsford. Maybe you’ve heard of him by his stage name Oliver Anthony. He has the most popular song on iTunes and just turned down an $8 million offer from music industry executives.
“Rich Men North of Richmond” has become sort of an anthem for working class Americans and the song touches on many of the themes that I’ve written about here. Specifically, the destruction of dollar purchasing power and the political duopoly dystopia-con that is Washington, DC. But Lunsford goes even deeper into social woes and comments specifically on problems like addiction and depression. He recently posted this to Facebook:
People in the music industry give me blank stares when I brush off 8 million dollar offers. I don't want 6 tour buses, 15 tractor trailers and a jet. I don't want to play stadium shows, I don't want to be in the spotlight. I wrote the music I wrote because I was suffering with mental health and depression. These songs have connected with millions of people on such a deep level because they're being sung by someone feeling the words in the very moment they were being sung. No editing, no agent, no bullshit. Just some idiot and his guitar. The style of music that we should have never gotten away from in the first place.
I can’t help but notice the absurdity of the juxtaposition in this moment. The distributed ledger technology that came with the emergence of Bitcoin is supposed to address the inequalities that people like Lunsford sing about. Yet in common practice, too many in the industry seem more enthusiastic about using the technology for riding the next speculative frenzy rather than for empowering publishers and creators.
From where I sit, you don’t have to like folk music or even agree with what Lunsford is saying to appreciate that he refuses to be a sellout. I respect it. If he had a ZEC address, I’d throw him a tip, or two. And for the record, I obviously do agree with a lot of what he’s saying in that song.
Some philosophers believe that nobody is born with a soul, that you have to earn one through suffering, and thought, and prayer. - Lisa Simpson
Disclaimer: I’m personally long ETH, BTC, ZEC, and DESO.
That song is BRILLIANT.
Great read