blockchain marketing tips One of the best pieces of advice I ever got was “always explain what you’re talking about. Never assume your audience knows the background – even if they’re experts.”

I’m especially careful to do that now around blockchain, the distributed database technology that assures the integrity of transactions or data without a central clearing house.* The hype around blockchain is so great, and the marketplaces in blockchain-based virtual currencies so hard to understand, that one billionaire investor recently called digital currencies based on blockchain “an unfounded fad.” In one story, he freely admits he is stumped by such cryptocurrencies and isn’t alone among savvy Wall Street investors puzzled by their popularity.

How’s That Again? 

To understand where we’re going wrong, check out one company’s response to the successful hacking of its peer to peer platform for initial coin offerings. These allow individual investors to help fund startups, creating a more democratic alternative to initial public offerings of stock that are usually only open to insiders or big investors.

In a July 24 post on a discussion thread, this company (which will go unnamed to protect the accused) said “We were hacked, possibly by a group. The hack seemed to be very sophisticated… the hacker(s) made away with $8.4M worth of tokens.” Doesn’t sound good, does it?

Here’s a sample of their explanation, edited for brevity. See if you can make heads or tails out of it.

“Although I hate to see assets stolen, and I hate thieves, the incident proved both the resilient demand for our tokens and the utility of the decentralized exchange…the amount stolen was miniscule (less than 00.07%) although the dollar amount was quite material.. .(the tokens stolen) are software that represent our knowledge, advisory and consulting skills, products and capabilities. Without (our) team, the tokens are literally worthless…we aren’t selling currencies, we aren’t selling securities. We are selling capabilities…We have already landed (a regional stock exchange as a client) just 30 days after the initial token offering…now you can see how inconsequential the mere hack of a few million dollars”

 Get all that? It’s reasonably clear that this company is offering tokens, on its blockchain-based platform, that customers can exchange for their consulting services. But while the dollar amount was miniscule, the dollar amount was quite material. So that means…what?

It’s Only A Few Million Dollars

The mention of the stock exchange as a customer (right after the company said “we aren’t selling securities”) is needlessly confusing. So is the rest of the post which I didn’t quote, as it goes into rambling detail about meetings they had with senior hedge funds executives who are thrilled with what they are doing. Also left unanswered is the central question: If a hacker could steal millions of dollars of worthless tokens from their platform, why should a stock exchange trust them with actual securities?

Finally, I love this sentence: “Now, you can see how inconsequential the mere hack of a few million dollars.” Not to me. The writer failed to remind readers of the essential context that no actual money was stolen – only tokens for the company’s service, which the company could disavow. A phrase like “…the mere hack of a few million dollars” is and should be a red flag for a customer or investor who is already skeptical about blockchain.

What we are left with, then, is a chasm between the enthusiasm for, and investment in, blockchain among major industry, financial and technology players such as  IBM, Bank of America and Amazon  and the skepticism that naturally results when we can’t explain what a blockchain is, what we’re using it to sell, and why a security breach on one isn’t such a big deal.

Into the breach, as always, step marketers like us. Our job is to explain complex concepts in ways that clearly show how they help the reader, viewer, or listener (for those into video or podcasts.) If we can’t do that well, we shouldn’t respond at all, as we’re only contributing to the problem.

Author: Bob Scheier
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I'm a veteran IT trade press reporter and editor with a passion for clear writing that explains how technology can help businesses. To learn more about my content marketing services, email bob@scheierassociates.com or call me at 508 725-7258.