WSJCoin: The Cryptocurrency That Never Was


At the start of this year we had a brilliant idea-OK, maybe just an idea.

We lined up a group of editors of the Wall Street Journal in a room and launched a publishing project that could help our readers understand how the cryptography industry is reshaping modern finance: we wanted to create the cryptocurrency of the Wall Street Journal and document the company.

After a first gasp in the room and much skepticism, we got the green light to proceed. Obviously, reporters, editors and videographers do not launch commercial initiatives in the Journal; this is done by co-workers. So ours was a journalistic exploration of how a cryptocurrency could work.

We traveled to Japan, the supposed bitcoin homeland, and we created what eventually became WSJCoin.

When the idea was hatched, the crypto-mania was near its peak. The price of bitcoin had fallen above the record level of almost $ 20,000, but many investors were confident that the decline would only be a blip. Liquidity was pouring into initial money offerings, a rather controversial form of raising funds from companies that sold digital tokens. The results of the startups were convinced that new concepts for digital currencies would have destroyed the traditional industries.

What a difference it makes almost a year.

Bitcoin has lost more than half its value in 2018, inflicting a blow to the cryptocurrency craze. The hopes of companies to collect large sums of money by selling their currencies to investors have almost vanished. In addition to the bitcoin, dozens of other cryptocurrencies have also fallen significantly, erasing hundreds of billions of dollars in market value.

Our cryptocurrency experiment proceeded again. Despite the market crash, many people in the industry still believed in the potential of digital currencies to destroy and remodel entire sectors. So we left for a mission to find out what drives this market a bit turbid.

A vivid journey

We have always seen the cryptic world, with its complicated jargon, a severe and technical universe. Japan has offered us a completely different vision. It looked like an idyllic cryptocurrency paradise full of color and fun.

There was a all-female pop band called Virtual Currency Girls. The band members wore French maid costumes and masks of different cryptocurrencies – which reflect the supposed anonymity of this market – as they danced to the beat of the blockchain wonders. There were intense exchanges of cryptocurrencies and solitary "miners" holed up in secret warehouses that processed transactions.

There was even a university professor at the helm of what he calls a "blockchain car", a small electric vehicle whose power was automatically paid for the use of cryptocurrencies. It was not a Lamborghini, often the favorite vehicle of bitcoin millionaires as a symbol of final status of crypto, but it was still strong enough.

A collection of WSJCoins prototypes

A collection of WSJCoins prototypes


Clément Bürge for The Wall Street Journal

So we found a developer to turn WSJCoin into a reality (although the cryptocurrency was never launched). He had moved from the United States to Japan, had taken a passport and a Japanese name and had earned so much money in the encryption boom that when we met, he was looking to buy part of an island in Cambodia.

"We could build a large co-working space there," said Makoto Takemiya, co-founder of the Japanese fintech startup Soramitsu, while showing us photos of the place on his phone.

With the help of Mr. Takemiya, we have created billions of WSJCoins and launched the theoretical project to potential investors in major technical conferences in Hong Kong. Most people loved it, even if we did not have a specific currency plan or business model.

Ideas are not lacking

We produced a documentary about the project and as soon as the film was released at the beginning of October, some readers and industry experts told us that we should actually launch the cryptocurrency for real. "Ask people to pay WSJ products" with the currency, a reader commented. Some possibilities: subscriptions, article payments, WSJ merchandise, events. Another noted that the WSJ mobile application could also function as a cryptographic wallet.

So, was there a genuine use case for WSJCoin? A way to differentiate it from over 2,000 cryptocurrencies on the market?

At a WSJCoin documentary event in Hong Kong, several industry experts who spoke in a panel after the screening said that there might be potential. "It's not a completely crazy idea," said Henri Arslanian, fintech and crypto leader for Asia at PricewaterhouseCoopers.

"If you really wanted WSJCoin to be successful, you should understand how you take what people really appreciate about WSJ – be it your content, your journalistic standards, your platform – and return the token itself," says Jehan Chu, co- founder and managing partner of Kenetic, an institutional investment and advisory platform for blockchain and cryptocurrency.

Some people have more drastic ideas. "We could reverse the equation and actually pay people to read using cryptocurrency," Takemiya said when the WSJCoin was created. A media company could then monetize the attention of its readers, by selling data, and readers could buy products using coins, he said.

Members of the Virtual Currency Girls, a female all-Japanese pop band

Members of the Virtual Currency Girls, a female all-Japanese pop band


Clément Bürge for The Wall Street Journal

A tall bar

Some press agencies are already experimenting with cryptocurrencies. A New York startup called Civil Media Co. hoped to use the proceeds of a symbolic sale to make grants to news organizations and develop research on the journalism industry. Token holders would have been able to tell their own, by voting, on which publications supported by Civil Media. But the initial supply of coins was a disappointment and the company said it is exploring a new, simpler sale of tokens in the future.

The difficulties of the civil media reflect a more widespread problem affecting the cryptocurrencies in general and the underlying blockchain technology.

"Technology must show real utility," says Chu. A self-proclaimed "bitcoin evangelist", he too has concerns. Blockchain "must improve our lives," he says. "He has to do something that is better than what was done before, and to be honest, blockchain has not done it fundamentally."

For the long vision, look back towards the turn of this century. The burst of the dot com bubble nearly 20 years ago was disastrous for technology stocks. But like most new technology things, many of those internet startups have been well ahead of their time.

"The fact that the bubble has exploded and the market collapsed in technology has not radically changed the proposition that each person's life is better with this version of the Internet than in 2001," says Chu.

In twenty years, the same could apply to blockchain technology. Maybe someday there might be a reason to revive WSJCoin.

Maybe it was a brilliant idea, after all.

Russolillo and Mr. Bürge are reporter for the Wall Street Journal in Hong Kong. They can be reached at [email protected] and [email protected]

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