Kickstarter puts Kickstarter on the blockchain

A Kickstarter promotional image for the blockchain project.

Hang in there, creators, as Kickstarter goes full blockchain.

In a blog post by CEO Aziz Hasan and co-founder Perry Chen on Thursday, the crowdfunding platform announcement that its “commitment to a more open, collaborative and decentralized future ”via blockchain, the technology behind cryptocurrencies like Bitcoin. The first step will be to establish an independent organization that will oversee the development of an open source blockchain-based system that works more or less like Kickstarter already does. Once completed, Kickstarter will switch to it. This protocol will eventually be available to everyone, Kickstarter said, including upstarts trying to compete with it.

“As a first step, we are supporting the development of an open source protocol that will essentially create a decentralized version of core Kickstarter functionality,” Hasan and Chen wrote in the post. “It will live on a public blockchain and be available for collaborators, independent contributors, and even Kickstarter competitors, around the world, to rely on, connect to, or use. We believe we are bringing everything we have learned about crowdfunding since 2009 to inform the development of a decentralized system protocol will open up exciting new opportunities for creative projects to come to life.

In addition to the independent entity designated to build the blockchain system, the announcement indicated that Kickstarter would also create an independent governance lab to oversee “the development of protocol governance.” He’s teaming up with blockchain company Celo, which uses a proof-of-stake method he says he uses just a “small fraction” of energy consumed by projects like Bitcoin and Ethereum and is therefore environmentally friendly. (Celo claims to be carbon negative, although this is based on offsets, a method critics often say is equivalent to greenwashing.)

Kickstarter says development will begin in Q1 2022, according to Bloomberg, and he expects the transition to be complete by the end of the year. Bloomberg noted that Kickstarter never achieved the hyper-growth status early investors expected – it has become a public benefit corporation, which is a type of business that doesn’t focus exclusively on the market. profit, in 2015 – and crowdfunding projects have largely shifted to blockchain technology. Last year, the company laid off a massive proportion of its workforce.

How it will actually work, beyond Kickstarter’s ability to scream “blockchain” as a spell to summon investors or perhaps get a cut of every project executed on the resulting protocol, is unclear. A white paper explaining how the Kickstarter-backed blockchain protocol will work won’t be released for a few weeks. TechCrunch wrote:

While the ‘stake’ in the Kickstarter model was a finished physical or digital product, the new blockchain crowdfunding platforms are shaking up that model by giving users project-related tokens that can increase in value as the market increases. product matures. Some of these efforts are arguably legal, but there are countless ways to hide what exactly is being bought and sold by users.

The ad promised that “as a user, the Kickstarter experience you know will stay the same.”

“There are many more details in the white paper published in the coming weeks ”, Kate Bernyk, a spokesperson for Kickstarter, told Gizmodo via email. Asked about the details– for example whether Kickstarter will switch to a token system, and if so, how users would be protected against price fluctuations—Bernyk directed Gizmodo to another blog post where the company specified, “Funders can continue to use regular credit and debit cards to engage in campaigns, and creators can continue to receive regular currency to complete their projects.

Reception of user news, especially in the indie games niche where Kickstarter has historically been popular, seemed mixed at best. A thread on Reddit’s r / boardgames community was full of negative reactions, while a number of game designers, creators and project leaders announced their disappointment on Twitter.

4:10 p.m. ET: This post has been updated with an additional comment from Kickstarter.

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