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Oct. 25, 2017, 12:22 p.m.
Business Models

Civil, the blockchain-based journalism marketplace, is building its first batch of publications

One of the most confusing efforts to fund journalism in recent memory is inching closer to reality.

If you’re still confused by Civil, the cryptocurrency-based journalism marketplace that went public this summer, you’re probably not alone. Since the company made its first appearance, reactions have included muted excitement, bewilderment, and outright dismissal about the company’s potential to provide a viable new funding model for journalism. (“What B.S.,” shrugged the sole commenter on our initial story about the company).

And yet, despite these inherent marketing challenges, Civil is an idea that has started to turn heads, both among investors and within journalism circles. The company said today that it’s raised $5 million from from ConsenSys, a “leading global blockchain venture studio.” More important, perhaps: It’s also attracted its first publication, Popula, an alternative news and politics site run by journalist (and past Nieman Lab contributor) Maria Bustillos, and joined by Sasha Frere-Jones, Ryan Bradley, Aaron Bady, and other big-name reporters. The site goes live in early 2018.

Built on top of blockchain (the same technology that underpins bitcoin), Civil promises to use the technology to build decentralized marketplaces for readers and journalists to work together to fund coverage of topics that interest them, or for those in the public interest. Readers will support reporters using “CVL” tokens, Civil’s cryptocurrency, giving them a speculative stake in the currency that will — hopefully — increase in value as more people buy in over time. This, Civil, hopes will encourage more people to invest in the marketplaces, creating a self-sustaining system that will help fund more reporting. (Ex-Politico execs Tom McGeveran, Josh Benson, and Katherine Lehr at Old Town Media are advising the effort; we covered their company in September.)

The overall idea is not that easy to understand, particularly for those who aren’t tech-inclined (and perhaps even for those who are). But Bustillos, head of Popula (also the name of a dot-com she cofounded nearly 20 years ago), said that Civil’s core and more understandable appeal is that it uses the decentralized blockchain to “create an indelible, incorruptible record outside the reach of third parties,” she said. “As journalists, it’s pretty obvious why that would be valuable to us. The whole idea of being an incorruptible record is what journalism is all about.”

Bustillos said that decentralized backups have felt particularly vital in 2016. Gawker’s archives, for example, are still in limbo, and Donald Trump and others have aimed vitriol at reporters and news organizations as a whole. Civil’s technology essentially enables every site to store its archives in the blockchain itself, making them nearly immune to deletion. “It’s basically a Wayback Machine, but just for Popula,” said Bustillos. “That thing is not able to be shut off unless someone shuts off the Internet itself. That alone makes this worth it for me.”

Civil is also pitching its technology as a way for journalists around the world to fight censorship. Because all changes made to the blockchain are public, it’s impossible for third parties — governmental or otherwise — to change or alter the information on it without notice. “No one will be able to remove the record or prevent her organization from publishing what it wants to publish,” said Matthew Iles, Civil’s founder, referring to Popula. He also pointed to the other key parts of Civil’s value proposition, which include direct connections with readers, ease of access to financing, and a reduced reliance on third-party tech companies.

Civil isn’t stopping its outreach efforts with Popula. Much of the company’s funding will go to building what it’s calling its “First Fleet,” a group of journalists it hopes to attract to run their own Civil-based publications. Civil says it’s already in the process of developing a few such publications, all of which will focus on local investigative and policy reporting. The Windy City Reporter will cover Chicago (“a daily alternative to the Chicago Tribune and Sun-Times”), while another, broader effort, Drugged Up, will cover the opioid crisis and the pharmaceutical industry. Iles said that Civil aims to use a blend of cash and CVL tokens to boost 30 newsrooms and 200 reporters in time for its launch in early 2018. (Interested reporters can apply here.)

While Civil does seem like a serious effort to build a sustainable new model for funding journalism, the effort will have to deal with the baggage it’s inherited from the ongoing turmoil and distrust facing bitcoin and cryptocurrencies as a whole. Iles also admitted that it’s not always easy to explain to the uninitiated what the company is, or how its underlying technology works. The blockchain is still a new concept, and the companies building on top of it haven’t collectively figured out a single vocabulary to describe all of the moving parts involved in making their ideas work.

Bustillos is, however, optimistic. While cryptocurrencies “have gotten a bad rap because of the early scandals,” she said, “it’s important for people to understand that the technology is not just about money. Cash is used for crimes, too, but that doesn’t mean that people are going to stop using it. The blockchain is value-neutral. It can be used for good or ill, like anything else.”

POSTED     Oct. 25, 2017, 12:22 p.m.
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