Twitter's failed OnlyFans-like product, OpenSea trading volume drops 99%, major FTC lawsuit | E1548 | Summary and Q&A

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August 30, 2022
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This Week in Startups
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Twitter's failed OnlyFans-like product, OpenSea trading volume drops 99%, major FTC lawsuit | E1548

TL;DR

Twitter's failed attempt at adult content monetization, NFT trading volume plummeting, Alexis Ohanian's crypto fund buying distressed assets.

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Key Insights

  • 🧑 Twitter's struggle with adult content monetization highlights challenges in managing sensitive content effectively.
  • 🤨 The drastic drop in NFT trading volume raises concerns about the future of digital assets and market trends.
  • 📼 Alexis Ohanian's crypto fund shift towards distressed assets signals a strategic move amidst market fluctuations.
  • ❓ Concerns over data privacy and geolocation tracking highlight ongoing issues with data brokerage practices.
  • 💠 Regulatory pressures and legal actions are shaping the landscape for companies involved in selling sensitive data.
  • 😀 Users need to be vigilant about their privacy settings and consider limiting location access in apps and devices.
  • ❓ The role of carriers in selling personal data underscores broader concerns about data privacy and protection.

Transcript

we got a big news show today with many wild topics this week is not getting quieter even though everybody's at burning man including twitter's cancelled only fans project may be one of the worst ideas we've ever heard oh no wait the worst idea was still getting eminem and snoop dogg to perform as their board apes to validate our critique from yeste... Read More

Questions & Answers

Q: Why did Twitter cancel its project for adult content monetization?

Twitter faced safety concerns as they were unable to effectively filter harmful content, leading to the cancellation of the project due to potential risks associated with it.

Q: What does the significant drop in NFT trading volume suggest?

The plummet in NFT trading volume indicates a loss of interest and activity in the NFT market, raising questions about the sustainability and long-term viability of such digital assets.

Q: What is the purpose of Alexis Ohanian's new crypto fund?

Alexis Ohanian's fund aims to invest in distressed crypto assets, potentially taking advantage of the market shift and acquiring assets that have decreased in value.

Q: How is the FTC addressing the issue of geolocation data being sold by data brokers?

The FTC is suing a data broker for selling geolocation data, focusing on the company's business model and addressing the issue under the doctrine of unfairness, which could set a precedent for privacy laws.

Summary

In this video, the hosts discuss various topics, including Twitter's canceled OnlyFans competitor, the decline in NFT trading volume, and Alexis Ohanian's new crypto fund. They also touch on a major FTC lawsuit against a data broker selling geolocation data for sensitive areas like reproductive clinics.

Questions & Answers

Q: What was Twitter's plan for monetizing adult content and why did they cancel it?

Earlier this year, Twitter was considering launching an OnlyFans competitor for monetizing adult content. However, they canceled the project after realizing they were not effectively policing harmful sexual content on their platform. They feared that if they launched the project, there would be an influx of child pornography, which they were unable to prevent.

Q: What are the challenges of allowing user-generated adult content on platforms like Twitter?

User-generated platforms like Twitter are not compatible with the adult industry due to the risk of exploitation and illegal content. Unlike other forms of content that can be easily moderated or regulated, adult content requires strict control and verification to ensure compliance with laws against underage and harmful content. Twitter's lenient account creation policy and lack of effective moderation make it unsafe to allow adult content on their platform.

Q: Why was Twitter's plan to monetize adult content a bad idea from a strategic standpoint?

Twitter's primary source of revenue largely comes from brand advertisers and advertisers targeting a mainstream audience. By launching an adult content monetization feature, it would deter major advertisers like Disney or big brands that don't want their ads associated with explicit content. It would also conflict with Twitter's image as a platform for intellectual and successful individuals. The decision to pursue adult content monetization was a strategic misstep, demonstrating a lack of understanding of their user base and revenue model.

Q: What alternatives could Twitter consider for monetization?

There are various ways Twitter could explore monetization without resorting to adult content. They could introduce a paid subscription model, offering premium features and benefits to their users. For example, they could provide a follower CRM, email collection tools, or integrated media sharing for professional profiles. It's crucial for Twitter to understand the value propositions that its intelligent and successful user base would be willing to pay for.

Q: How has the trading volume of NFTs changed since May?

NFT trading volume has experienced a drastic decline since its peak in May. OpenSea, a popular NFT marketplace, saw its daily volume drop by 99% on August 28th, from $406 million to $5 million. Similarly, OpenSea's monthly volume dropped by about 90%. The floor price of popular NFT collections like Board Apes has also declined significantly, down 53% from May to August.

Q: What factors might have contributed to the decline in NFT trading volume?

The decline in NFT trading volume can be attributed to various factors. First, there might have been an oversaturation of the market, with too many new NFT collections entering the space. This dilutes the demand for individual collections and lowers their value. Second, there could be a shift in investor sentiment as people realize the speculative nature of NFTs and the potential risks involved. Finally, increased regulatory scrutiny and the association of NFTs with scams and cringe-worthy projects have likely deterred investors.

Q: Why do some people see potential in NFT technology despite the decline in trading volume?

NFT technology itself has unique potential beyond speculative trading. It can be leveraged for various applications such as memberships, fractional ownership, or curation of digital content. The permissionless nature of NFTs allows for innovation and new possibilities. While the current phase of NFTs may be experiencing a decline, the underlying technology still holds promise for future developments.

Q: What is Alexis Ohanian's new crypto fund focusing on?

Alexis Ohanian, through his venture firm 776, plans to raise $177 million for investing in distressed crypto tokens. Distressed tokens refer to projects or tokens that are facing challenges or have seen a decline in value. Ohanian believes this is a good time to buy in the industry and views the current market as an opportunity. However, investing in distressed assets comes with potential risks, such as regulatory issues and the uncertain fundamental value of these tokens.

Q: What is the FTC lawsuit regarding data broker Kochava about?

The FTC has filed a lawsuit against data broker Kochava for selling geolocation data on people visiting sensitive areas, including reproductive clinics. This data includes information about individuals' visits to abortion clinics, raising concerns about privacy and potential misuse of this data. The FTC is suing Kochava under the doctrine of unfairness, alleging that the company misrepresented its data collection practices and violated consumer privacy rights.

Q: How does Kochava's sale of geolocation data relate to the larger issue of digital surveillance and privacy?

The case involving Kochava highlights the danger of digital surveillance and the potential misuse of personal data. It brings attention to the need for stronger privacy laws and regulations surrounding the collection and sale of sensitive information like geolocation data. Consumers should be more aware of their phone settings and consider limiting apps' access to their location data. Companies like Apple have made efforts to provide more control over location sharing, but consumers still need to take proactive measures to protect their privacy.

Q: Why is the FTC suing Kochava under the doctrine of unfairness?

The FTC's lawsuit against Kochava is not specifically targeting the sale of abortion data but rather the company's deceptive practices. The FTC is using the doctrine of unfairness to hold Kochava accountable for misrepresenting its data collection as anonymous when it could be de-anonymized and tied back to individuals. This lawsuit could set a significant precedent for privacy laws related to location data and strengthen consumer protection against deceptive data practices.

Summary & Key Takeaways

  • Twitter's failed attempt at allowing adult content monetization due to safety concerns.

  • NFT trading volume has dropped significantly, indicating a decrease in interest and activity.

  • Alexis Ohanian's new crypto fund aims to buy distressed assets amidst the market shift.

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