BlockbusterDAO: A New Experience to Harness the Power of Symbolic Nostalgia


Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please review our website policy before making any financial decisions.

Many believe that GameStop was saved from bankruptcy by the nostalgia fueled by retail traders. Can the same work for the iconic Blockbuster franchise, but in a new tokenized DAO form?

Payment integration isn’t the only thing FinTech has revolutionized. By pushing the boundaries of convenience, FinTech has sparked the growth of crowdfunding campaigns. Last year, in North America alone, crowdfunding funds grew 33%, generating $ 17.2 billion. On average, these campaigns manage to raise around $ 29,000.

However, as we approach the end of 2021, we are seeing the evolution of crowdfunding through decentralization. More precisely, tokenized DAOs – decentralized autonomous organizations – ended the year on a high note.

After all, DAOs resist the deplatform while providing a transparent form of staking and voting via tokens. Despite the potential of its success, BlockbusterDAO shows another possible through smart contracts. In this case, the DAO aims to revitalize the spirit of the long-lost video rental store chain, Blockbuster.

How and why does BlockbusterDAO want to resurrect Blockbuster?

BlockbusterDAO is both a Twitter handle, having joined the platform this month, and a name for a new DAO. Its stated objective in a recent Twitter feed from December 25 is to raise enough funds to buy the Blockbuster brand from the current owner, Dish Network, a satellite TV provider with a 15.6% market share in the United States.

From the thread, it is clear that BlockbusterDAO wants to buy out the brand to achieve the following goals:

  • Transform the Blockbuster brand into a DAO platform to deliver video and fund movie projects.
  • Raise $ 5 million to beat backoffs for Dish Network’s Blockbuster IP brand.
  • The funds would be raised by selling NFTs, where each NFT would cost 0.13 ETH.
  • If the purchase of the IP Blockbuster was successful, it would be registered with the DAO.

We’ve seen variations of this approach in play before. ConstitutionDAO, a collective of politically minded crypto enthusiasts, attempted to buy a rare copy of the U.S. Constitution from Sotheby’s after raising $ 27 million in the week. following its launch. However, even though the auction house estimated the sale price to be between $ 15 million and $ 20 million, Ken Griffin outbid the DAO to $ 43 million.

This can be a double-edged sword for such crowdfunding campaigns. They rely on public traction, but it also brings out unknown bidders. Longing for the past is also a big factor, having gone from negative to positive.

Additionally, a Netflix documentary was released in 2020 titled The last blockbuster, representing the last remaining Blockbuster retail store in Bend, Oregon. It’s safe to say that this increased the nostalgia factor even further, and the price of the Blockbuster with it. In the third quarter of 2021, Dish Network reported total revenue of $ 4.45 billion, so $ 5 million for the brand at BlockbusterDAO would constitute 0.1% of company profits.

BlockbusterDAO appears to be aware of this issue, offering to “launch an awareness and public relations campaign to lobby to sell“:

However, this is also the case with ConstitutionDAO which managed to rise well above the initial threshold, exceeding it by 137.42%. If that happens again, fortunes could turn out differently.

Unfortunately, ETH gas charges are so severe and volatile that they alone amounted to $ 800,000 to $ 1 million in reimbursement expenses, according to figures pulled by Richard Chen. Whatever happens, the mechanisms for collecting and repaying DAO funds are clearly working. Even if BlockbusterDAO fails in its initial mission, we are seeing a new trend emerging in real time.

Apart from expensive ETH gas charges, DAO financing offers a non-mediated money back guarantee through smart contracts. In turn, this builds public confidence.

Likewise, BlockbusterDAO and ConstitutionDAO have made good reasons to educate the public about what is possible with smart contract blockchains. These are all good winds for future overfunded projects with secondary goals that can turn into Big DeFi behemoths.

Join our Telegram group and never miss an update from the world of DeFi.

Why did Blockbuster fail?

The story of Blockblust is eerily similar to that of GameStop. Launched in Dallas in 1985, Blockbuster’s in-store video rental business model has grown into a vast network of 9,000 outfits across the country. Sadly, it couldn’t last long beyond its peak in 2004, when Blockbuster achieved $ 5.9 billion in revenue.

The massive adoption of high-speed internet, cheap storage, and online video on demand all helped erode Blockbuster’s business model. This was further exacerbated by the elimination of late fees, resulting in a cost of around $ 200 million, alongside the unsuccessful launch of Blockbuster Online. Additionally, the emerging Netflix had no brick and mortar baggage.

Finally, Blockbuster CEO John Antioco made a critical mistake. He could have bought Netflix in its early days for just $ 50 million, according to Netflix co-founder Marc Randolph in his book It will never work. It was right after the bubble crash, so Netflix was in dire straits and still had to rely on an unprofitable DVD rental service by mail.

Fast forward to Blockbuster’s bankruptcy in September 2010, and there was no more revenue generating opportunity to explore.

Finances change.

Learn how, with Five Minute Finance.

A weekly newsletter that covers major trends in FinTech and Decentralized Finance.

Do you think BlockbusterDAO will find a way? What type of institution would benefit most from DAO funding, staking and governance? Let us know in the comments below.

About the Author

Tim Fries is the co-founder of The Tokenist. He has a BSc in Mechanical Engineering from the University of Michigan and an MBA from the Booth School of Business at the University of Chicago. Tim was a Senior Associate in the investment team of RW Baird’s US Private Equity division and is also a co-founder of Protective Technologies Capital, an investment firm specializing in detection, protection and protection solutions. control.


Comments are closed.