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BitClout Has Reaped $160M for Tokens Pegged to Celebs. We Followed the Money

Some people are calling BitClout “Bitconnect 2.0”

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In brief

  • BitClout tokenizes all of Twitter.
  • But at present, the project doesn’t let you withdraw the funds you put into it.

Amid a white-hot craze for NFTs, a firm called BitClout is pitching itself as a “crypto celebrity network.” The site offers consumers the opportunity to purchase tokens tied to the identities of 15,000 influential Twitter accounts, including the likes of Elon Musk and Katy Perry—albeit without their permission.

In the space of a week, BitClout has reportedly earned $160 million and attracted the interest of prominent investors and cultural figures. But already, crypto security firms are pointing to suspicious transactions patterns, and warning the site has all the appearances of a scam.

If BitClout is indeed a swindle, it would underscore how a new generation of crypto technology—this time NFTs—has given rise to new breeds of scammers.

Risk assessment

Bids for an NFT of Jack Dorsey’s first tweet recently reached $2.5 million. Such prices have touched off a race to tokenize Twitter artifacts of all sorts. In the case of BitClout, the site has downloaded 15,000 of the most popular Twitter profiles and then assigned thousands of cryptocurrency tokens to each of them. The price of the tokens are loosely pegged to a given profile’s relative popularity—meaning that investing in the tokens is like investing in the social ranking of a given celebrity.

Meanwhile, an influencer who tweets about the site can claim a portion of the tokens associated with their identity. Elon Musk is theoretically entitled to $2.96 millionworth of BitClout’s Elon Musk tokens, while lesser lights can redeem several thousand dollars.

Minor celebrities who have tweeted about BitClout include Neil Strauss, author of a controversial pick-up artist book: 

BitClout appears to be an attempt to co-opt Twitter’s social media feed, operating in the same way Steemit provides a crypto version of Reddit and Voice.com maps Facebook onto a blockchain

For those seeking to participate in BitClout’s marketplace, a necessary first step is to buy BitClout tokens with Bitcoin. And that has already given rise to a big red flag about the site: Namely, Blockchain explorer tools show that the funds ended up at just one address before getting transported across the cryptoverse. 

Rich Sanders, who runs blockchain investigation firm CipherBlade, confirmed to Decrypt that almost all of the funds on the site are going to three exchanges—88.41% to Amber Group, 11.17% to Kraken, and 0.42% to Coinbase—and that the funds have since moved to other exchanges and wallets. 

And one of the only non-exchange addresses that BitClout paid directly received money from Hydra, a darknet market. In other words: “They paid someone sketchy,” said Sanders. 

Flow of transactions from BitClout

Flow of transactions from BitClout’s wallet.

Signs point to the address being owned by a suspect individual from Nigeria, whom BitClout may have paid to drum up the Twitter bots to promote the project on social media, said Sanders. “Because social media shills = more proceeds.” Decrypt reached out to a Twitter account bearing BitClout’s name but received no reply. 

Meanwhile, London-based Coinfirm, which specializes in tracing suspect crypto transactions, has also raised alarms about BitClout. In an interview with Decrypt, Coinfirm executives described the site as “Bitconnect 2.0”—a reference to a notorious Ponzi scheme site whose tokens reached a value of nearly $400 during the crypto mania of 2017. Today, those tokens are worthless.

Where’s my money?

Although you can supposedly buy BitClout tokens with BTC, you can’t take your BitClout tokens out of the BitClout network. You can only send BitClout tokens to other BitClout users or use them to buy creator coins; there’s no way to redeem any of this for cash or Bitcoin. 

The site is unusable for users that haven’t purchased BitClout tokens. Updating a profile picture, posting a status or messaging a chatbot is impossible without first buying the coins. And when Decrypt wired about $20 in Bitcoin to the platform, the site didn’t allow us to use our money to buy BitClout tokens.

Nor is there any way to verify that such transactions would take place on a blockchain. While there is an explorer, the network fee is zero and there’s no obvious way to create a node or mine coins. The anonymous team hasn’t published the code for the project.

Shadow army

Despite some high-profile backing, just a few accounts are verified; even then, verification isn’t a sure-fire bet that an influencer associates their name with the project. Neither Chamath Palihapitiya nor Ashton Kutcher, two of the highest-profile ‘verified’ accounts, have tweeted about the project—necessary to verify an account.

Two of the largest Twitter accounts for r/WallStreetBets, another account registered as verified, told Decrypt that they had nothing to do with WSB’s BitClout persona, which gushes about the project in daily messages on BitClout.

Most of the BitClout fans on Twitter, a handful of followers each, have little other activity to their name save for their promotion of the project.

Take @Ssh_Just_Buy, an account created in February that sporadically pumped small-cap altcoins until March 12, when the account flipped to pumping BitClout. The account published a link to their own website explaining the project in detail just two days later. 

Making the operation murkier still, BitClout’s network keeps going offline. “Diamondhands,” which appears to be the account on BitClout that’s behind the project, said on BitClout that this was because nodes kept rebooting and missing transactions.

Early investors

Chris McCann, BitClout Investor

So who’s buying in? One early investor is Chris McCann, a tousled Silicon Valley investor who caught wind of the project from friends. McCann, a general partner at Race Capital, told Decrypt that he has no connection to the project or its founders but got involved in an early access version of the project that launched last week. 

McCann, who boasts a market cap of $55,400, said he’s invested “a little bit too much” money into the project but credits the anonymous team with the “smooth” website. 

One of his friends, Andy Artz, an investor at Silicon Valley firm Social Capital, bet $18,000 on his success. 

“Once you kind of get sucked in and start making some early bets on people and they get verified, it’s fun—you actually want to want to use it,” said McCann, who gained access to almost $34,000 in unredeemable BitClout tokens when he tweeted about the project to verify his account. 

Michael Arrington, a well-known Silicon Valley investor and media figure, received the equivalent of $290,000 in creator tokens. He did not respond to Decrypt’s request for comment.

McCann said that BitClout fills a demand for social crypto projects unmet by the current roster of such projects, such as social token sites Rally or Roll—the latter of which was hacked over the weekend, crashing the prices of the tokens tied to the influencers that use the platform.

McCann is well aware of the concerns, notably the inability to redeem money and the opportunity for imposters to profit from fake accounts. “It’s still ridiculously early,” he said. And it wouldn’t be the first of McCann’s investments—his other bets include crypto exchanges FTX and Binance—that got off to shaky starts and later flourished.

But for CipherBlade’s Sanders, it doesn’t look good and smacks of the pump n’ dump ICOs that wasted billions of investors’ money in 2017 and 2018. “What a dumpster fire,” he concluded.

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://decrypt.co/62162/bitclout-reaped-160m-tokens-pegged-celebs-followed-money

Blockchain

Why investors are now enthusiastic about “blockchain games”

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Cryptocurrency that has already caused multiple bubbles this year. But what investors are looking at right now is something that’s already ahead – blockchain games.
We will explore the background of investors’ attention to blockchain games while explaining how blockchain affects the game industry and the relationship between blockchain games and cryptocurrencies.

1. Why are investors now focusing on blockchain games?

Development of the game industry with the latest
AI (artificial intelligence), VR (virtual reality), and he is AR (augmented reality), which are becoming more and more familiar with the development of technology. One of the industries in which these latest technologies have a great influence is the game industry. The feeling of entering the game world attracts many gamers.
Currently, the main experience is at game centers and events, but in the future it will not be long before there is one VR per family.Fusion of virtual currency and games
Entering the game industry with cryptocurrencies is an indispensable topic in explaining the relationship between games and blockchain. The number of games that allow you to buy and sell items using virtual currency is increasing.
for example CryptoKitties(暗号仔猫)

Is a pioneer of games that can be traded with virtual currencies, but since its introduction in 2017, huge amounts of virtual currencies have been traded. CryptoKittes is built like a blockchain of Ethereum (ETH), which is a kind of virtual currency, and it is a mechanism that you can buy and sell kittens using Ethereum.
Especially after the word NFT (Non-Fungible Token)  became familiar, the merits of owning NFT were easily understood by people, and NFT was traded at a value of millions to tens of millions of yen.

Why blockchain contributes to the gaming industry
Blockchain plays a very important role in games that will be further developed by the latest technology and will also be a virtual currency exchange.
In a nutshell, blockchain makes in-game cryptocurrency transactions more secure.
In the first place, blockchain is called “distributed ledger technology”, and it is a technology that allows users to manage and share the same ledger on the network. The transaction data history of virtual currency is called “transaction”, and the one that stores a certain number of transactions together is called “block”. When a new block is created, it becomes a “blockchain” by connecting with past blocks like a chain.
Generating blocks requires a huge amount of computer-based calculations. In addition, since the data is distributed to many computers all over the world, even if some of the data in the chain is tampered with, the entire data will not be affected, and the risk of service outage will be infinitely zero. close.
It is a fact that it seems natural when understanding the mechanism of blockchain that blockchain has a great influence on secure cryptocurrency transactions in games. By making safe transactions, the number of users of online games will increase quadratically.

Blockchain entry into online casinos
Traditional online games aren’t the only ones that have made remarkable progress with blockchain. “Online casinos”, where you can enjoy casinos on your computer, are also one of the industries that are benefiting from blockchain.
Online casinos, like traditional casinos, generate monetary transactions and handle personal information. By introducing blockchain there, users will be able to trade with peace of mind. Concerns about “the management side may be illegally controlling data and losing money” that comes to mind when trading money online are dispelled.

As with games, the number of casinos that can be traded using virtual currency is increasing,   An online casino where you can play for less than $ 1 

2. The future of blockchain games that investors are paying attention to

Games using blockchain are evolving day by day. For example, Epic Digital Collectibles is a game where you can enjoy card games online, and you fight with cards collected using virtual currency. Considering that the cards that have been collected in kind (Yu-Gi-Oh! Cards, Pokemon cards, etc.) have been given huge values ​​depending on their rarity, the transaction amount of cards traded online will be ridiculous. right. Also, it’s easy to imagine that online casinos will become exactly “Las Vegas, which can be accessed online at any time” -a platform for huge transactions.

Online games and casinos can now be used more safely using blockchain. Blockchain games, which have the inevitable potential to turn into a huge market, will undoubtedly continue to attract the attention of investors.

Source: Plato Data Intelligence

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Blockchain

United States Infrastructure Bill Brings Cardano Billionaire to Washington.

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Cardano Founder, Charles Hoskinson to Speak at GBA Blockchain & Infrastructure.

 

Charles Hoskinson, Founder of Cardano and Co-Founder of Ethereum, 

Educates Government Legislators, Regulators, & Administrators

 

The recent debate over the Infrastructure Bill has made two things clear: 

The government will be regulating blockchain activities, but they don’t understand it well enough to do an effective job. For that reason, the Government Blockchain Association (GBA) and our partners are organizing Blockchain & Infrastructure, a two-day educational seminar for government leaders and their staff. The educational content will be delivered to public sector organizations exploring blockchain and cryptocurrency.

 

Mr. Charles Hoskinson of Cardano will be speaking live from Washington, DC, and will also be broadcast to virtual attendees in the Americas, Europe, Asia, Africa, and Australia. This 2-day hybrid experience will be a crash course in blockchain and cryptocurrency training, followed by an evening reception for networking and meeting the speakers, including Charles Hoskinson, Scott Stornetta, and other blockchain pioneers. Live and virtual attendees will also be able to engage with Mr. Hoskinson and other participants through a conference app provided by Qbix.

 

In 2013, Mr. Hoskinson was one of the original founders of Ethereum. A few years later, he spearheaded IOHK (Input Output Hong Kong), whose key project is Cardano. Cardano’s market cap is currently over $69 Billion. IOHK sponsors blockchain technology research labs at the University of Edinburgh and the Tokyo Institute of Technology and is collaborating on a blockchain research project with the University of Wyoming. Mr. Hoskinson will be speaking at Blockchain & Infrastructure and will be networking with conference attendees during the evening reception on September 28 in Washington DC.

 

Source: PlatoData Intelligence

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Blockchain

Robinhood Silently to Test Crypto Wallets & Crypto Transfer Functions

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According to a Bloomberg report, Zero-commission financial trading platform Robinhood is low-profile testing new crypto wallet features for its customers, which will allow users to send and receive cryptocurrencies.

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Reportedly, Robinhood users currently can only use U.S. dollars to buy cryptocurrencies and trade digital assets on the platform but cannot withdraw the encrypted assets.

This is the first time the company has introduced deposit and withdrawal functions for digital assets like Bitcoin (BTC). 

Bloomberg reported that the beta version of the application on its IOS system reflects the company’s work on such functions. Also, there is a hidden image showing the waiting list page for users to register for the function of the encrypted wallet. It also involves the code related to the transfer of cryptocurrency assets.

Robinhood CEO Vlad Tenev pointed out in the second-quarter earnings conference call that adding a crypto wallet is the top priority of the company’s developers and said:

“It’s something that our teams are working on. The ability to deposit and withdraw cryptocurrencies is tricky to do with scale, and we want to make sure it’s done correctly and properly.”

As reported by Blockchain.News on September 9, Robinhood Markets Inc. has launched a new cryptocurrency recurring investment feature that lets customers automatically invest in cryptocurrencies on a daily, weekly, or monthly schedule.

The new feature is set to allow its customers to purchase cryptocurrency commission-free and with a little as $1 worth of cryptocurrency of their choice monthly, weekly or even daily.

Image source: Shutterstock
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Source: https://Blockchain.News/news/robinhood-silently-to-test-crypto-wallets-crypto-transfer-functions

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Blockchain

Reasons behind Monday’s Crypto Market Sell-off Panic: Evergrande Group shaky Bankruptcy Threat Ahead

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The fall down of the Chinese real estate giant Evergrande Group swept the entire cryptocurrency market. Evergrande’s financial crisis caused investors to worry about China’s catastrophic debt default, which caused panic selling in the market.

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Bitcoin and Ethereum are the first to bear the brunt, and the entire cryptocurrency market value has evaporated by $250 billion.

According to Coinmarketcap, starting from Monday morning, the value of global cryptocurrencies plummeted to a low of about 1.8 trillion U.S. dollars, which occurred at approximately 8 o’clock UTC time, a decrease of nearly 11% from the previous 24 hours. The market value has evaporated by more than $250 billion.

At the time of writing, the current market value has rebounded, around $1.9 trillion.

Bitcoin price fell by 9% today to less than $42,669, which is the lowest level in more than a month, while the price of Ether fell nearly 10% to a low of $2,940, the lowest since early August level.

Bitcoin was trading at $42,863.02, and the price of Ether returned to the support level of $3,000, trading around $3,034.31 at the press time.

The remaining cryptocurrencies, such as Solana’s sol and Cardano’s ADA, which have skyrocketed recently, also fell by about 10% at the peak of the sell-off.

The reason for this plunge is not just because the Chinese real estate giant Evergrande Group is carrying a massive debt of $305 billion and is unable to repay the debt due this month, but also faces the risk of bankruptcy which poses a threat to the broader market.

And there is also the panic selling caused by the increasingly stringent national regulatory review of cryptocurrencies.

Recently, according to a Bloomberg report, the derivatives regulator is notably investigating the leading cryptocurrency exchange Binance for possible insider trading and market manipulation.

Also, as reported by Blockchain.News on September 13, The South Korean Financial Services Commission (FSC) has begun to tighten the supervision of local and overseas cryptocurrency trading platforms. This regulation may terminate nearly two-thirds of unapproved South Korea’s cryptocurrency exchanges for legal transactions.

Image source: Shutterstock
PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://Blockchain.News/analysis/reasons-behind-monday-crypto-market-sell-off-panic-evergrande-group-shaky-bankruptcy-threat-ahead

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