Media Startup Raised Millions on Ethereum via an ICO w/out actual Crypto Plans

Among the biggest initial coin offering (ICO) of 2018, was TaTaTu’s. It started as a $575 million token sale but is now just a rewards program for watching videos. Originally, the TaTaTu project was initiated to offer a publicly traded Cryptocurrency associated with a media streaming platform similar to Netflix. They once attracted investment from BlockTower Capital founded by Ari Paul’s and movie stars including Johnny Depp.
TaTaTu is just the right epitome to describe a platform that used “blockchain” as a fundraising technique for their own gains and then largely moved on; as some token sales started to slowly yield results. The project was run by a band of remote freelancers hired by tech-newcomer Iervolino, but still managed to be among the top-five largest token sales of 2018, behind EOS ($4 billion) and Telegram ($1.7 billion). Lervolino says now that crypto was never really the point. In his words regarding TaTaTu being a Blockchain Business, he stated clearly, “Not at all. We have one blockchain component in our system.”
Users have still tried to trade the company’s ethereum-based TTU token on public platforms like YoBit.Net. Something fishy already oozed out owing to the fact that TTU token activity has remained low since August 2018, just a few weeks after the sale’s completion in June, 70 percent of all transactions occurred only around July 31 and August 1, 2018. There really seems like not much intention to sell an ‘actual’ token was the point. Alethio’s reporting tool was used to conduct the analysis that birthed this finding.

An online alias Legendster who is also a former employee, said in an interview that he was tasked to generate buzz via announcements, airdrop threads, and bounty campaigns where “basically anyone and everyone is welcome.” Another former TaTaTu cofounder, who asked to stay anonymous to protect his professional relationships, also said in the interview:
“Whoever invested in TaTaTu in the beginning did it thinking that they would be buying a token that can work on a decentralized platform and could be traded. … I think that [Iervolino] is not behaving fairly to the people that invested in TaTaTu.”

Lervolino told CoinDesk this is because, despite what the TaTaTu white paper originally listed, this token sale was mostly done through private investments. He declined to name any individual participants, adding the company has since transferred that value to a platform-based points system without a public blockchain like ethereum. (This is why Alethio’s analysis was unable to detect significant activity since last year.)
Commonly among the former employees, Iervolino was seen as the sole driver and overseer of this operation. About a year later since the TTU ICO was launched , Iervolino declined to say how many users the live platform has attracted so far which is shady.
The site now offers films like 2006’s “Snakes on a Train” and 2012’s “Abraham Lincoln vs. Zombies.” even as TaTaTu critics now describe the token sale as merely opportunistic; the chief sees the startup as creating a “circular economy” that rewards users with tokens for watching films, plus fashion shows and sporting events. He also said these tokens can also be used toward coupons, with various e-commerce and retail partners such as the Italian luggage manufacturer Carpisa. Plus, he added, Italian users can now access an e-commerce site where “some test products” are available for purchase with TTU.
His plans for the future of the TaTaTu has deviated much from the original white paper in the past 12 months but Lervolino maintains: “It’s a streaming platform, mixed with social media, that shares the value with the users.”

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Credits- Leigh Cuen

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