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Block.one pours $150 million into its new social media platform

Block.one, the startup behind the EOS blockchain, paid $30 million in cash to purchase a domain name for its social media platform Voice.The post Block.one paid $30 million to purchase a domain name for its social media platform appeared first on The Block.

Block.one’s new social media application is as eye-catching as it is expensive, costing the company $150 million to build, CEO Brendon Blumer told The Block.

According to Blumer, the company spent at least a year rolling out its social media platform, dubbed Voice. The final product was announced in a much-anticipated conference on June 1 and its Beta version is now available for users to sign up.

Block.one, the company behind the EOS blockchain, claims that only real people, instead of bots, will be using its social media platform. To achieve this end, the company implements a special authentication process to onboard users, which possibly involves checking people's government IDs, per a CoinDesk report.

"It has never been more important to know who we are interacting with, and who we are getting our information from," said Blumer at the June 1 conference.

This feature might hit home for many traditional social media firms, as they are plagued by the problem of fake accounts and bots. Facebook recently announced that it deleted 2.2 billion fake accounts in the first quarter of 2019 and that approximately 5% of its monthly active users are fake.

Besides this crusade against bots, Voice also hopes to set itself apart from the traditional social media pack through a different set of content sharing rules, at the center of which is the VOICE token, which “has the fairest distribution model in the world,” said Block.one CTO Dan Larimer.

Users receive a certain amount of VOICE tokens every day and can earn more by collecting likes from the content they share. They can then spend the token on promoting their posts and comments.

According to Larimer, the token cannot be purchased or mined. The only way to acquire it is by creating and sharing content.

“It [the VOICE token] isn’t created by buying it or burning electricity. It can only be created by being a real person, producing real content, liked by real people. When you participate, you earn,” said Larimer.

To be sure, running a social media platform on a blockchain is not a novel idea. Prior to joining Block.one, Larimer served as CTO for another blockchain-based social media network, Steemit. The platform operates similarly to Voice, where publishers receive rewards for their posts via digital tokens associated with the Steem blockchain. However, Steemit recently laid off nearly 70% of its staff, coating the future of blockchain-based social media applications with a sense of uncertainty.

As for the idea of having a token to power user activities on a social media platform, messaging app Kik Interactive Inc. perhaps leaves an alarming footnote. Kik is recently entangled in a court dispute with the Securities and Exchange Commission (SEC) over its 2017 initial coin offering (ICO). While Kik promised that its token would be used on the Kik messaging app, no real use case for the token was created, alleged the SEC.

It is unclear how Block.one will profit from Voice to make its $150 million investment worth it. However, since Voice is built on Block.one's EOS blockchain and users signing up for the application will automatically receive EOS accounts as well, it may act as a gateway to introduce users to the EOS network and its projects.

Besides, given that the firm raised $4 billion in one of the largest ICOs last year, generating revenue may not be as much of a priority as driving market demand for Voice to match with existing social media applications.