When discussing the NFT space with ppl I constantly have to mention it's currently full of scammers and outright criminals, who have no qualms about starting endless rounds of ponzis to basically steal money from people.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
But, I always add, this will change.
Why? How?
👇 pic.twitter.com/mRZICQvwrG
I believe the NFT space has the potential to replace shares as a much more fun, more accessible, more dynamic model for investing in, well, anything from startups to artists to social projects or movements...
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Whatever you dream, if it needs funds, NFTs can probably help.
And NFTs can do this so much better than the current models we have. Shares are slow, complicated, localised, illiquid, boring and quite scary for most people.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
"I'd like to sell you some shares" vs "buy a cool jpeg to support my idea!"
The second one is a lot less scary.
A huge boon of NFTs is also how much lower the ticket price often is. To invest in startups, you typically need many tens thousands of pounds in liquidity - every year. And since they're illiquid, you don't see it back for, optimistically, a decade.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Most people can't afford to park £50k a year into illiquid investments, so even if you got rid of accredited investor rules they could not participate in startup funding easily. It's just too complicated to manage. The Trusted Third Parties charge too much.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
NFTs solve this.
I see NFTs (in the fundraising context) as an invention roughly equivalent in impact to the creation of the Amsterdam Stock Exchange - the first of its kind - in 1602. It allowed so many more ppl to participate in wealth creation and led to much more wealth all around.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
And yeah, the tulip mania followed 30y later. But given that the Dutch Empire dominated the world for 100y, until the British took over (after Dutch ppl left for Ldn and brought their innovations with them), I think we can safely say the tulip mania was an acceptable cost.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
And so, to an extent, is the current smorgasbord of ponzis and scams. It's a - so far - unavoidable and necessary side-effect of a new financial space that is outside the reach of governments - notwithstanding Gensler's assertion about "our markets"... https://t.co/oGZATlkmSr
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
But just because we have to put up with it for now doesn't mean it's here to stay.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
In fact, in order for NFTs to really deliver on their full potential, we're going to have to clean that shit up, and clean it up good.
So in this context, I find myself extremely pleased to see someone who seems like an absolute dumpster fire of a human being, who nevertheless has been given so much unwarranted attention and power, being outed and, hopefully, given the boot. https://t.co/BMvFvumKr5
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Of course, until he finally gets to where he belongs (in jail for fraud, stealing, and whatever else they find in his far too long and colourful history of scamming), Beanie can start again under another pseudonym. He can afford to keep doing it again, again, again... pic.twitter.com/A6qLNhUL2x
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Unless you, anon, decide to do better. The power is in your hands. Will you demand that the teams you invest in are doxxed? Or will you follow the hype trends that manipulators have laid before you?https://t.co/27o0tzSQpl
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Either way, I warmly welcome the appearance of serious investigative reporters like @nftethics. Whilst there's always a risk of things going too far the other way and turning into puritan witch hunts, rn the NFT space really needs some god damn inquisitors to clean all the shit.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Worth a mention in this thread is also @zachxbt, whose account I discovered recently, who also investigates scammers in the crypto and NFT space. Worth a follow for sure.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Also: @0xQuit - whose account is worth checking before any suspect airdrop.
With web3, we can't wait for someone else to clean up our space for us. We're going to have to do it ourselves. I see three key pillars of this shift, and I hope we make substantial progress on all three of them in 2022, because I want NFT fundraising to take off.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
The first pillar is doxxing and vetting. Teams should not be able to raise millions of dollars anonymously, unless they have a **really good reason** (read: state persecution) to do so.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
An NFT project is a powerful entity. It should be transparent, auditable, doxxed, etc.
And while we don't want to over-rely on trusted third parties, the fact is, we already do: influencers are hugely centralised and utterly unreliable and, as we've seen, frequently immoral.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
We can do better, even in a decentralised fashion.
As part of this first pillar, I hope to witness, and participate, in the emergence of entities that stake their reputation to vouch for the legitimacy of projects they endorse.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
99% of current projects won't make the cut. I'm ok with that. They'll be replaced by better.
The second pillar is better use of smart contracts. It boggles the mind that we have the ability to write vesting schedules into the minting contracts and yet we constantly agree to give, upfront, no strings attached, piles of cash to anonymous founders on day one.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Like, wtf? pic.twitter.com/RDyoLfAeBc
Please someone develop ERC1721 or whatever it needs to be called, and make vesting restrictions a standard feature that any project must abide by to have any credibility of not being a rug.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
(and that someone probably won't be me because I'm busy doing 10'000 things atm!)
The third pillar to clean up our space is investor education. NFT investment suffers from too much exceptionalism, the "four most dangerous words" combined with the hype cycle and the mass entry of unsophisticated investors makes it seem like web3 is just a magic money fountain. pic.twitter.com/sU74mHEcoe
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
Sorry to burst your bubble but it's not.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
As I keep repeating, money in = money out, whether you're running a startup, an NFT project, a new crypto currency, a DAO, etc, etc.
The only sustainable way to create returns is to create value so ppl give you money for the value.
Much like we have learned not to believe it when people call us and tell us about this amazing opportunity to make $3k a day working from home, we need to learn to disbelieve the rubbish so many projects peddle us to disguise their wolf-themed casinos and cutesy ponzis.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
And... we'll get there.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
We're getting there.
Bit by bit.
We're still so damn early.
I'm proud to be part of trying to make this space better, so it can become a dynamic, unstoppable, unregulatable engine of investment to power the future of tech, society, and more. pic.twitter.com/AqSRzoO9lI
Until we get there... let's get cleaning.
— Daniel Tenner (swombat.eth) (@swombat) January 17, 2022
gm & gl
PS: if you like this thread, pls RT, follow, and also check my other threads all neatly collected at https://t.co/X91GS2YlJN, along with my transparency report: https://t.co/aGCjv0mAZl pic.twitter.com/cyuASGIjVs