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Behind the door covered with stickers of an anonymous Brooklyn building in New York, a startup is trying to sell the public a stake in a new business model for the old profession of journalism.
The model is based on the blockchain, better known as the technology behind bitcoin, the virtual currency. But blockchain – the term used for a digital system in which all computers contribute to a secure, permanent and public ledger – has many more applications than a speculative currency. Advocates believe that the power of blockchain can help stimulate a new wave of businesses and organizations, just as the Internet has changed the trade and flow of information.
And one of the industries that could be affected is journalism, which has been damaged in recent decades when the Internet has taken away the monopolies of traditional news.
One of the first companies to push that change is a Brooklyn startup called Civil Media, which launched an ambitious plan last week to kick off what it hopes will be a new journalism economy capable of supporting a new generation of multimedia startups in a time when old and new news is facing a difficult future.
The goal of Civil is to help press agencies to raise funds from readers and investors while providing tools to monetize journalism. In addition, readers who have purchased Civil cryptocurrency tokens, CVL, can "vote" on whether a store is doing its job well and ethically.
"What we are doing with Civil is trying to build a platform that exists for the sole purpose of promoting ethical journalism, to be a home for the independent network of editorial agencies managed and managed individually," said Matt Coolidge, a co-founder of l & # 39; company.
The building that Civil occupies in the Bushwick section of the district is shared by a variety of startups that are part of ConsenSys, a company that is betting blockchain technology – in particular, a blockchain system known as Ethereum – will usher in a new era of innovation.
The goal of Civil is to use Ethereum to create a platform that provides a more direct connection between the work created by journalists and the value it creates for readers.
Given that Google, Facebook, Amazon and Twitter absorb billions of dollars of advertising revenue that otherwise could go to news, the US media industry continues to suffer layoffs and closures.
Unlike technology giants, Civil "explicitly states from the first day that our primary incentive is to serve ethical journalism," Coolidge said. "We have created rules and a system of checks and balances to ensure that this remains the case."
ConsenSys, founded in October 2014 by Joseph Lubin, who also co-founded Ethereum, funded Civil in October with $ 2.5 million in cash and another $ 2.5 million in services. ConsenSys currently incorporates more than 40 startups aimed at creating a variety of business on Ethereum including online poker, legal agreements and advertising technology.
There are a variety of different blockchain applications, including Ethereum, which has been praised for "smart contracts" that can automate a wide variety of interactions. Civil is built on Ethereum, using the system for a variety of its service offerings, including a way for editors to receive money for licensing their content and a system to ensure that editors act ethically.
Civil is not the only startup that tries to use blockchain technology for journalism. Po.et, founded in February 2018, has a similar mission.
"The path that Po.et is leading towards digital artistic independence can free not only the creators of content, but also media companies, brands and marketers from servitude to particular platforms, publishers and income models", wrote the CEO of Po.et Jarrod Dicker in a blog post.
The Central to Civil mission is what is known as a token, which is a specialized digital currency within Ethereum. In a blog post, managing director and civil co-founder Matthew Iles compared his CVL tokens within the civil system with the US dollar within the US economy.
"The more you participate and contribute, the more you earn," he wrote. "A growing symbolic economy, as a national economy that benefits from the increased production and activity of its participants, often correlates with a strengthened currency".
To kick off that economy, Civil opened the sale of its CVL token last week, offering a value of $ 24 million. The holders of aspiring tokens, who must pass a test, must also commit themselves to contribute and regulate ethical journalism on the platform.
Tokens are meant to create a shared responsibility among all editors of Civil, readers and anyone who is part of the media industry.
Newsrooms have to wager $ 1,000 in CVL when they apply to be enrolled in the civil registry and adhere to a series of journalistic ethics encoded in a document called the Civil Constitution. Token holders who believe that an existing or potential press room violates these values must also wager $ 1000 in token to challenge its ability to appear in the register. Thus, token holders vote for the challenge.
If the editorial board is refused, he loses his deposit, which is split between the challenger and the token holders who voted to reject it. If the challenge fails, then the challenger's deposit is split between the applying editor and the token holders who voted to accept it. This process provides an economic incentive to CVL token owners to protect the integrity of journalism on the platform.
Civil has already signed partnerships with Associated Press, the Annenberg School for Communication and Journalism at the University of Southern California and the European Journalism Center, among others. The company also has some thriving news agencies, including The Colorado Sun, initiated by journalists fired by the Denver Post and Cannabis Wire, which covers the marijuana industry.
The sale of civil tokens arrives while the future of the media remains in doubt. While layoffs continue to hit newspapers and media organizations in the United States, digital products have sprung up in hopes of finding new models to support journalism.
The falling prices of cryptocurrency – Ether, Ethereum's cryptocurrency, have declined significantly in recent months – have moderated a bit of optimism for blockchain applications, but investments are still pouring into blockchain startups.
"Even though cryptocurrency markets are falling … [venture capital] funding for blockchain startups has increased in 2018, with over 225 transactions totaling over $ 2 billion so far this year, "said Arieh Levi, an analyst at the startup investment firm CB Insights, in a e-mail.
Ben Jones, an independent blockchain researcher, said that the Civil experiment belongs to a particular class of blockchain applications known as "token-maintained registries", which can provide an economic incentive for token holders to take care of information and retain the other parties responsible.
He said that the token-maintained registries are still a relatively new phenomenon, but that he thinks he has serious potential.
"We hope that what we'll see next year and so forth will be a lot of different projects that have different approaches," Jones said. "And I suspect that what comes out will be something really beautiful that will really work and change the world."