The impending launch of the $ZORA token, the native asset of the NFT-focused layer-2 network Zora, has been significantly amplified by the recent emergence of "content coins," a concept championed by Jesse Pollak
The impending launch of $ZORA, the native token of NFT-focused layer-2 network Zora, has been heightened by the recent buzz surrounding "content coins." This concept, introduced by Jesse Pollak, a founder of Coinbase's layer-2 network, Base, and actively promoted by Pollak, focuses on tokens representing individual pieces of content, granting ownership and potential monetization to creators.
These tokens, primarily launched on Zora, derive value from community engagement. While proponents highlight the potential for greater creator funding and on-chain creativity, critics view content coins as rebranded meme coins, lacking intrinsic value and driven by speculation, especially given the large portion of the token allocated to the team and advisors.
The "Base is for everyone" content coin, launched on Zora, became a lightning rod for controversy after experiencing a dramatic pump and subsequent 99% price crash within hours of its release. Despite Base's disclaimer that it was merely a "public experiment" and not an official Coinbase or Base token, this incident has cast a shadow of doubt over the transparency and speculative nature of projects closely tied to the Zora protocol.
Now, as Zora prepares to launch its own token on April 23, attention shifts to the startup, which raised $50 million at a $600 million valuation in 2022 with backing from Coinbase Ventures. Zora is airdropping 10% of its 10 billion $ZORA token supply to early users, but the allocation of 65% of the supply to the team and advisors, despite the lack of a clearly defined utility for the $ZORA token other than "fun," has sparked criticism.
This stands in stark contrast to the narrative promoted by Pollak, who actively pushed the "coining content" concept on Zora, aiming to generate hype and inflate the token's price upon listing on exchanges like Binance Alpha. The two airdrop snapshots, one spanning five years and the other a month, also raise questions about fairness and the potential for incentivizing short-term engagement.
Some members of the crypto community have expressed skepticism towards ZORA, highlighting the lack of governance or rights for token holders, despite the presence of a treasury structure and a large-scale economic model. This, they argue, is a classic "pump and dump" strategy, designed to benefit insiders at the expense of retail investors.
With its prominent backing and the hype surrounding the content coin experiment, Zora appears to be launching a token with no inherent value, while simultaneously allocating a significant portion of its supply to its team and investors. This approach has been labeled as "BS" by some, who argue that it will mislead retail investors into putting real money into a speculative asset with no clear fundamentals.
Moreover, data from Token Terminal shows a decline in Zora's active user base over the past year, raising concerns about the persistence of demand for the $ZORA token beyond the hype cycle.
