The NFT market may have crashed back in July, but that didn’t spell the end of NFTs. Instead, companies doubled down: Instagram actually expanded its NFT functionality about a week ago and, around that same time, Starbucks teased the September rollout of NFTs as part of its customer rewards program. It seems despite the occasional snafu, Web3 is still growing, whether you understand the appeal or not.
So now is a good time to peek inside the brains of the Web3 people by remembering the most bizarre Web3 pivots in history. These stories aren’t just goofs on crypto at its dumbest. Instead, think of these as moments when the veil that obscures the innermost desires of the crypto faithful fell away and those of us watching from the sidelines were able to more clearly glimpse the patterns and mechanisms driving this whole phenomenon. (Bonus: Yes, a lot of these were unintentionally funny.)
4 things to learn from the embarrassing Slope hack on Solana
1. Applebee’s sells transferrable NFTs paired with extremely non-transferrable food
From time to time, a company or celebrity will announce an NFT art dump — an easy way to cash in on the craze without investing much effort. Anyone can do this, whether you’re the Star Trek Franchise, beloved filmmaker Quentin Tarantino, or felon Anna Delvey. But some companies try a little harder — sometimes way, way too hard — and that’s when the seams of the crypto world start to show.
The precise money-making gambit behind the Metaverse Monday NFT project launched by Applebee’s Bar & Grill is not completely clear. Each Monday in December of 2021, an Applebee’s-themed NFT went up for sale. Each one was a picture of a stylized Applebee’s meal. The artwork itself was ostensibly the main event at first, with each artist lavishly credited on the Metaverse Monday website. But then it was announced that the first NFT came with a surprise Applebee’s gift card worth $1,300 and the others would, too. Rather puzzlingly, however, these gift cards aren’t transferable. They can be used by “the auction winner and first NFT owner” — which one assumes will always be the same person. If an Applebee’s NFT is sold on the secondary market, the new owner does not get free food. Just a picture of food.
So after the first NFT sold for $25, the others were initially purchased for closer to the value of the accompanying gift card, and there hasn’t been much activity around these NFTs since then.
2. West Virginians vote via blockchain
During the 2018 midterm elections, West Virginia Secretary of State Mac Warner excitedly rolled out a partnership with a tech company called Voatz which promised West Virginians serving overseas in the military a safe and secure blockchain-based app that could be used to cast ballots. It would be a boon for overseas voting, Warner hoped.
“There is nobody that deserves the right to vote any more than the guys that are out there, and the women that are out there, putting their lives on the line for us,” Warner said.
Those election results weren’t called into question in any significant way. In fact, Warner had reportedly planned to use Voatz again in 2020. But confidence in the state’s blockchain-based voting system slowly dissolved anyway, starting in 2019, when the FBI announced that they were investigating what they believed to be an unsuccessful hack of West Virginia’s election centered on Voatz.
The following year, a team at MIT, led by graduate student Michael A. Specter, wrote a technical paper outlining Voatz’s vulnerabilities: While the app was open, assuming you were using unencrypted wifi, attackers could easily invade your privacy by peeking at your vote. They could also watch live as you filled out your ballot and disconnect you from the system before you finalized your vote if they didn’t like what they saw. So while the blockchain itself may not be easily hackable, the security of any application that puts things onto the blockchain is another matter.
Warner pulled the plug on Voatz in March of 2020.
“If the public doesn’t want it, or is skeptical to the point they’re not confident in the results, we have to take that into consideration,” Donald Kersey, Warner’s lawyer said, according to Cointelegraph.
3. Pearson announces a way to profit from secondhand textbook sales…and it’s NFTs
To college students, buying textbooks secondhand can ease the pain of an experience that already resembles a mugging. Among expenditures measured by the U.S. Bureau of Labor Statistics, the price of textbooks has been on one of the most punishingly steep inclines since the start of the millennium, alongside hospital services and college tuition — though they did hit a plateau starting in 2015.
Well, according to Andy Bird, CEO of Pearson Plc, that price plateau may not cut into profits much longer because textbooks are entering the metaverse, where publishers can make money every time a textbook is resold.
“In the analogue world, a Pearson textbook was resold up to seven times, and we would only participate in the first sale,” Bird said at a press event on August 1, according to Bloomberg. Bird hopes to “diminish the secondary market” through blockchain and NFTs, which will let his company track the book’s unique ID on a blockchain ledger from “owner A to owner B to owner C.”
This sounds like it will require textbooks to be purchased exclusively in a blockchain-enabled marketplace. Will that make textbooks cheaper, or in any way enhance the experience of the students who go deeply into debt buying and using them? Who can possibly say?
4. ICE buys crypto spy software from Coinbase
Okay, U.S. Immigration and Customs Enforcement (ICE) didn’t announce this Web3 pivot. It was, in fact, only made public by journalists at VICE, The Intercept, and Tech Inquiry. But this story shows that law enforcement is susceptible to crypto FOMO, too.
In 2021, ICE sought and received forensic research tools from Coinbase, namely: a piece of Coinbase software called Tracer, Coinbase’s tool for gleaning crypto-related intelligence from public blockchain activity.
Tracer is able to cull usable activity data from the vast firehose of public blockchain transactions, and pull out usable information from the patterns. In the crypto world, since transactions are anonymized but public, keeping your activities secret involves using a service like Tornado to spread transactions around from wallet to wallet, thus obscuring buying and selling patterns. Tools like the ones ICE bought from Coinbase are designed to thwart tools like Tornado, in the furtherance of their criminal investigations.
So let this be a reminder that anonymity on the blockchain is far from assured.
5. Tuvalu will exist on the blockchain because soon it may not exist anywhere else
You may remember Tuvalu as the island nation whose minister gave a speech last year during the COP26 climate change conference in which he spoke from a podium planted in thigh-deep water, illustrating that bigger, richer countries’ greenhouse gas emissions are causing the seas to swallow his tiny country. According to Karlos Lee Moresi, the former Tuvaluan secretary of finance, “It is possible that, in 50 years’ time, Tuvalu will still be there. But in 100 years’ time, it will be underwater. That is the best-case scenario.”
But an overseas-born Tuvaluan named George Siosi Samuels has launched an attempted rescue of his homeland, if not physically, then digitally. His plan, which has already been tentatively adopted by the government of Tuvalu, is to secure Tuvalu’s future by, in effect, making it a tradeable digital asset on the blockchain, owned jointly by all citizens. And if (well, when) Tuvalu disappears into the ocean, the country’s blockchain ledger will still be there — assuming there’s still an internet to host it.
Web3 darling Helium has bragged about Lime being a client for years. Lime says it isn’t true.
The earliest phase of the plan is oddly plausible: The country’s top-level domain is .tv, meaning it’s used by prominent streaming and television websites like Twitch as a public-facing web address. By selling the use of .tv, Tuvalu reportedly rakes in millions of dollars each year. So in terms of creating a digital business strategy, Tuvalu has a head start, but the rest of its crypto-based plan of salvation remains to be rolled out.