There’s a new decentralized autonomous organization (DAO) on the scene, and just like the one that was trying to buy a copy of the United States Constitution at Sotheby’s last month, this one has its eyes on an equally lofty, prestigious prize: the defunct movie rental chain Blockbuster.
In a Christmas Day Twitter thread, BlockbusterDAO, as the group is aptly known, announced its intention to raise more than $5 million to wrest the brand from the control Dish Network, which bought Blockbuster at auction in 2011 for $320 million. The end goal, according to the DAO’s tweets, is to bring Blockbuster into the Web3 space, turning it into the first decentralized film streaming service and eventually establishing the brand as a tastemaker simultaneously capable of winning major awards and generating in excess of $1B in Annual Reoccurring Revenue (ARR). Sounds straightforward enough.
In the tweets, BlockbusterDAO claims that the brand is a target largely due to the fact that it’s “...not only nostalgic, but it’s a historic landmark in the history of film.” According to the group, that brand recognition was not enough to save the company from “terrible leadership with an inability to pivot and make dynamic business decisions,” which is why Blockbuster makes sense as a Web3 entity “owned by the people and governed by the people.” Blockbuster and the United States of America are very much alike, in that way.
For the uninitiated, DAOs are more or less crypto hedge funds: they pool resources from the public, with individuals able to secure voting power and influence by purchasing tokens, NFTs, or other forms of cryptocurrency. Blockchain enthusiasts and meme investors are increasingly keen on decentralized ownership schemes, which are structured to be democratically-minded rather than traditional forms of ownership, but such investments aren’t without their risks. It’s worth keeping in mind that these groups are often loosely organized and BlockbusterDAO doesn’t even have a website. At this point, the group is just a Twitter account and a Discord server.
If you need a cautionary tale, look no further than the foiled plot to purchase the U.S. Constitution, which drew in nearly 20,000 investors before going belly-up. Although the DAO backing the crowdsourcing efforts initially promised to refund the $47 million raised, things got a little complicated after the failed bidding on the Constitution. The group decided to give donors the option to receive their refunds as governance tokens (PEOPLE) for their original value in ether, minus gas fees, or as a newly-minted governance token called We the People (WTP), which ConstitutionDAO made up just now for reasons they’re not specifying, in an amount proportional to the current value of their PEOPLE tokens.
It’s probably not a good idea to try jumping into this shady scheme as an investor but hey, maybe we’ll get to see Blockbuster have the last laugh when Web3 revolutionizes the world.