Intended to help save journalism, Civil ICO, initial coin offering, looks like a flop
Heading into the final stretch, Civil’s initial coin offering looks like a serious flop.
Civil is aiming to raise at least $8 million by selling a new cryptocurrency that would be used to help support quality journalism. But only $1.4 million had been raised by midday today, according to Token Foundry. Co-founder Matt Coolidge said Civil wouldn’t give up until the offering formally ends at midnight, but he acknowledged that the firm is unlikely to reach its target.
“I’m not a gambling man, but I don’t like those odds,” he said in an email.
If Civil fails to reach the $8 million minimum, investors will be offered refunds. Most would be paid to ConsenSys, the parent of Civil, which as of last week accounted for 82% of the ICO’s purchases. ConsenSys co-founder Joe Lubin is a major figure in the cryptocurrency world and one of the brains behind Ethereum, the No. 2 crypto after bitcoin.
Civil initially had hoped to raise up to $32 million by selling investors the new cryptocurrency CVL, which owners could use to reward news outlets for producing quality journalism on the Civil platform. Conversely, providers of false or misleading work would be punished by having their crypto taken away and even could lose their right to publish on the platform. More than a dozen newsrooms publish under the Civil umbrella, including Block Club Chicago, the Colorado Sun, Cannabis Wire and political-corruption watchdog Sludge.
But Civil’s ICO has been met with near radio silence in part because the cryptocurrency market has gone stone-cold, with bitcoin and others shedding two-third of their value or more this year.
Also, Civil executives acknowledge that their business model isn’t easy to understand. Its newsroom ecosystem is to be governed by a constitution still being drafted and overseen by a council. How this governance structure would help address journalism’s never-ending revenue crunch is a bit of a mystery.
Coolidge said a failed ICO wouldn’t immediately impact Civil or its member newsrooms.
“The project will go on nonetheless,” he insisted.
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