After user backlash, Kickstarter will slow its transition to blockchain

Many of Kickstarter’s loyal customers were stunned when the crowdfunding leader announced in December that it was going to transition its platform from Kickstarter technology. Both creators and backers received swift and negative feedback. On Thursday, more than two months later, the company has issued a new statement declaring that it is pumping the brakes, effectively slowing — but not stopping — its transition to a novel protocol built on cryptographic “proof of stake” technology.

There is much controversy around blockchain technology. There are many potential dangers associated with using blockchain technology, according to its detractors. Its computational power is what generates heat and energy. This technology can be criticized for its inability to handle large amounts of data. This technology has proven to be a very lucrative tool for fraud when it is applied to products like cryptocurrency or non-fungible tokens.

On the contrary, advocates see blockchain technology as a powerful force multiplier in capitalistic ventures. It is a complicated and immutable system that secures and facilitates financial transactions and internet technology.

According to the theory, visitors to Kickstarter could see a seamless transition to blockchain technology. However, it could change the entire technology used by the platform. Many in the community are voicing concern, and creators have publicly vowed to move their businesses elsewhere.

Kickstarter has announced that it regrets its original statement. The promised white paper that would describe the company’s approach to crowdfunding will not be released at this point. The company is instead taking a step back and evaluating the process.

“It’s clear to us now,” the company said, “that before we do anything else, we need to listen to your feedback so that we can better address your concerns.”

“These new technologies are tools that are only as good as what they’re used to build,” it continued. “It’s our responsibility to make sure they serve creators, backers, and the entire creative ecosystem, and that we are designing thoughtfully with full awareness of the challenges.”

In Thursday’s announcement, Kickstarter lays out four steps that it will take to mend fences with its community.

First, it will not move the Kickstarter website onto a blockchain protocol “unless it has been tested.”

We’re not going to force this on creators and communities for whom Kickstarter is already working well. We’re not going to automatically shift all of Kickstarter to a new infrastructure. We’ll never put your livelihoods at risk by making you try something untested. We’re going to invest in experimenting, by supporting an independent organization in its effort to build new infrastructure that has the potential to serve more of the creative communities who aren’t fully served by crowdfunding today. We’ll make sure there’s a proof of concept with the creators who want to use it. We’ll look to integrate the pieces that offer value to the larger community down the line, but not without your input shaping the direction.

Second, it will establish an “advisory council,” including backers and creators, to help guide its next steps.

You indicated that you would like us to immediately address creator issues on the core platform. We’ll work with the council to prioritize the development of features on Kickstarter — features that you have been long asking for — as well as potential new solutions to make the platform better and safer for everyone. This group will be a guide for the parameters and problems we have to fix as we begin work on the protocol.

Third, it reaffirmed its promise that the blockchain protocol it helps to create for crowdfunding will be built by “an independent organization.” That organization, like Kickstarter itself, will be a public benefit corporation (PBC), that is a business entity with an in-built legal responsibility to perform a social good.

This protocol, as we announced in an earlier announcement, will be developed by an independent organisation. Although it will not be affiliated with Kickstarter, the structure will be similar to Kickstarter in that each PBC will have its own mission and guideline. It will work openly, so the protocol code is open-source and accessible to all. This openness is a tool to improve accountability and collaborate.

Kickstarter stated that it will review its impact on the environment with respect to blockchain technology. Specifically, it says that carbon offsets — financial instruments that allow organizations to theoretically combat the impact of their own planet warming emissions — “are not enough.”

“We’ve committed in our PBC charter to limiting our environmental impact,” Kickstarter said, “and we’ll hold the new protocol to the same standard.”

Those interested in learning more about Kickstarter’s plans are invited to subscribe to a newsletter, and to read an updated FAQ that digs more into its plans.