🥛 Napster is back!
- Writer Milk Man
- February 16, 2023
- •4 Min Read
Gm. This is Milk Road, the crypto newsletter that loves you more than Ben Affleck loves being from Boston. If you love us back, would you mind taking 90 seconds (literally!) for our first reader survey?
Here’s what we’ve got for you today:
- Everyone’s fav 2000s music service dives into Web3
- FTX Round Up: Subpoenas, lawsuits, and a $150m charity scheme
- An owner burned his Bored Ape to make a pro-Bitcoin statement
- Final Fantasy creators go web3
NAPSTER 3.0... 4.0? WE'VE LOST COUNT
The year is 2000. You don your wedge flip flops, halter top, and oversized sunglasses to go get your ears pierced at Claire’s in the mall. You swing open your flip phone to meet up with your friends.
If you’re lucky enough to own an mp3 player, its 32MB capacity is filled thanks to a questionably legal peer-to-peer music sharing program called Napster. Life is good.
Until Napster gets shut down over copyright violations in 2001. Womp womp.
But fast forward 22 years, and Napster is now one of the many companies trying to cash in on the Web3 craze.
It just acquired Mint Songs, a startup that lets artists turn music into NFTs. Its tech will integrate into Napster, which will start offering digital collectibles for artists to connect with their fans sometime in Q2.
Wait, you said Napster died in 2001…
While the original music sharing service was shut down, the Napster brand has lived a wild life since then:
- Media firm called Roxio bought it for $5.3M around 2002
- Then Best Buy bought the Napster brand for $121M in 2008
- Rhapsody (streaming music service) made a deal with Best Buy to acquire Napster’s subscribers and other assets
- Rhapsody rebranded to Napster in 2016
- MelodyVR, a VR platform, bought Napster for $70M in 2020
- Blockchain firm Algorand and Hivemind bought Napster in May 2022
- And it kicked off a Web3 VC arm, Napster Ventures, in September 2022 and brought an ex-Roblox exec on as CEO
- The Mint Songs acquisition is the venture fund’s first deal
So it looks like yet another 2000s-era relic is springing back into the mainstream. Low-rise jeans, for the love of god please….don’t follow suit.
LEARN NFTS WITH METAMASK LEARN
How could you and your art benefit from learning about NFTs?
Whether it’s to understand the hubbub of what they’re really about, explore another medium for your craft, or just learn more about how web3 paid out an average of $174,000 per creator in 2021, this interactive lesson from MetaMask Learn is designed to help you.
NFTs can be many things, but at these tokens' core, an NFT is a provably scarce digital item. Web3 artists’ favorite wallet, MetaMask, wants to inspire you to learn about NFTs so you can see for yourself if you’d like to explore this community-centric field that’s disrupting the creator economy.
Interested in learning about how NFTs are relevant to you as a creator?
FTX ROUND UP: SUBPOENAS, LAWSUITS, AND A $150M CHARITY SCHEME
FTX is making headlines again this week. And it isn’t just one. Or two…it’s four different headlines.
If this was McDonalds, it’d be a 4-piece McWTF.
Here’s the round up of everything that’s been going on:
1/ FTX “insiders” have been subpoenaed
A federal bankruptcy court in Delaware subpoenaed a total of seven former key FTX employees including: Samuel Bankman-Fried, Joseph Bankman-Fried (SBF’s papa), Caroline Ellison (CEO of Alameda Research and SBF’s ex-lover), Gary Wang (former FTX CTO), Russell Capone, and more. Damn shame for Russell Capone, with a name like that he could’ve made it anywhere.
Subpoenas were being thrown out like free cars at an Oprah show.
The people that got served have been ordered to turn in all documents & information related to the collapse of FTX by February 16th. Everyone has a different “to-do” list that include details about payments to/from the crypto exchange, all real estate holdings, plus any comms (emails, texts, letters sent by pigeon) between them about FTX, and more.
And while FTXs employees were getting hit with subpoenas…
2/ FTXs investors & partners get hit with lawsuits
- Silvergate Bank (a crypto bank) is being sued by an FTX user for allegedly “aiding and abetting a multi-billion dollar fraudulent scheme”. According to the allegations, Silvergate Bank not only knew that FTX was stealing customer funds, but it was done using Silvergate’s platform. From watergate → deflategate → silvergate.
- VC firms Sequoia Capital, Paradigm, and Thoma Bravo are also being sued for allegedly promoting FTX way too hard and giving it an “air of legitimacy”. Some of the investors were calling SBF a special founder who is “stunningly ambitious”.
3/ JPMorgan is holding hundreds of millions of dollars of SBF’s money
According to a New York Times report, SBF invested into a tiny hedge fund called Modula Capital. Public filings show the company was based in the Bahamas and operated from… *checks notes*... the same luxury condo where SBF and other execs lived.
And guess what? Around the time FTX collapsed, Modula’s holdings were converted into cash and stored in an interest-bearing account with JPMorgan, which handled its trading in stocks and stock futures.
Now, the new FTX management is negotiating the return of that $400M+ with JPMorgan.
4/ A charity tied to an FTX exec allegedly made $150M+ from an insider deal and wants to cash out
Ruairi Donnelly is the former Chief of Staff for FTX & Alameda Research. He also ran a charity called Polaris Ventures.
Well, turns out Donnelly allegedly used his charity to make $150M by “donating” his salary using FTT tokens (FTXs native token). Donnelly received ~$560k in salary during his time at FTX, which was converted into FTX Token (FTT) at a rate not available to the public, $0.05. He then “donated” the tokens to Polaris Ventures, and sold the FTT at a price of $1 after public trading opened - netting ~$150M.
I know, I know. Never a dull moment in the FTX Fiasco. Which is why we always like to bring out our favorite diagram to describe it all….
BURNED APE YACHT CLUB
What do you do when you own a $169K NFT? Destroy it, of course.
Jason Williams moved an NFT from the popular Bored Ape Yacht Club collection from the Ethereum network, removing it from circulation or “burning” it, to a location linked to an Ordinals Inscription. That's a piece of content attached to a satoshi (100 millionth of a Bitcoin) that lives permanently on the Bitcoin blockchain.
So…why’d he do this? Basically to symbolize Bitcoin’s blockchain potential for hosting an NFT ecosystem (Ethereum has cemented itself as the Queen Bee of NFT homes. All hail.)
Not everyone’s convinced it’s legit though. Yuga Labs (BAYC creator) said swerve, you moved the Bored Ape off ETH so now it’s illegitimate, plus you essentially don’t own it anymore.
And Williams told Decrypt lol this’ll be fun to see how it plays out.
Looks like the Bitcoin v. Ethereum battle rages on.
MILK AND COOKIES
Coming soon: a new Bitcoin Embassy. El Salvador is working with Texas to open a new Bitcoin Embassy in the U.S state. The goal? Aid "expansion of commercial and economic exchange projects." Texas BBQ 🤝 El Salvador's Pupusas.
Creator of Final Fantasy goes Web3. Square Enix is launching a new NFT-based game called Symbiogenesis. The gaming publisher has already launched successful games like Final Fantasy, Kingdom Hearts, and Dragon Quest.
Digital bonds hit the blockchain. Siemens, the third-largest publicly traded company in Germany, just issued its first digital bond worth ~$64M on the Polygon blockchain. Say hello to blockchain-based bonds.
That's a wrap for today. Stay thirsty & see ya tomorrow! If you want more, be sure to follow our Twitter (@MilkRoadDaily)
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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.
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