An Australian blockchain-based peer-to-peer electricity trading startup is on the receiving end of criticism for rewarding bounty hunters who used unscrupulous means to drive interest in its crypto token.
According to the Financial Review, Power Ledger has been criticized for allocating free tokens to bounty hunters who made exaggerated or false claims regarding the startup with a view of increasing the uptake of the Australian crypto firm’s tokens.
Some of the exaggerated or misleading claims included stating that the startup had drawn the interest of the renowned clean energy advocate and billionaire founder of Tesla, Elon Musk, who was keen on revolutionizing the retail electricity sector.
Currently, Power Ledger’s token, POWR, is trading around 20% below the issue price and has a market cap of over US$30 million.
Power Ledger has defended itself, arguing that it only used the bounty hunters because the startup wanted to create “grassroots support for the currency sale.” According to Power Ledger, 1.5 million tokens were set aside for the bounty hunters.
Per Dr. Jemma Green, the chairman and co-founder of Power Ledger, the startup had no way of supervising the behavior of the bounty hunters:
Rewards were offered to community members to share our project with their own networks. The means by which they did so were outside of our control, and we made it clear that our core supporters who believed in the project and the future of renewable energy were the main audience for this program.
The criticisms that have been leveled against Power Ledger have, however, not dissuaded the P2P energy-trading startup from its mission. Earlier this month, a trial for trading solar power in the Australian coastal city of Fremantle on a blockchain-based platform provided by Power Ledger kicked off successfully.
This enabled about 40 households in the coastal city to determine both the buying and selling price of renewable electricity generated on their rooftops.
At the time, the Minister for Finance, Energy and Aboriginal Affairs in the government of Western Australia, Ben Wyatt, dubbed the trial a “world first:”
The trial represents an innovative solution to virtual energy trading that may have implications for energy utilities working to balance energy supply and demand all over the world. These households are believed to be the first in the world to be taking part in an active, billed, peer-to-peer trading trial that allows them to effectively buy and sell solar energy generated by their rooftop system across the grid.
Across the Pacific, Power Ledger also inked a deal with energy supplier American PowerNet last month and this saw the Australian crypto startup deploy its blockchain-based electricity trading platform, xGrid, at the headquarters of the U.S. utility in Pennsylvania.
Update 1/4: Power Ledger reached out to CCN.com to dispute details in the original report from the Financial Review and provide context on the bounty program. Their statement has been reproduced below:
The article is focused on the bounty program Power Ledger ran throughout our Token Generation Event (TGE) in 2017. ‘Bounty’ refers to the common practice companies in the blockchain space employ to reward community members for sharing news with their social circles. While other programs range in their activities, ours was focused on the sharing of Power Ledger’s official social media posts.
Our program was similar to many other mainstream social media and community engagement campaigns. For example, Airbnb’s #OneLessStranger campaign incentivised participation by sending 100,000 members of the Airbnb community ten dollars each for sharing photos using the hashtag.
Our bounty program was run transparently and designed to avoid manipulation and protect consumers. We consider our bounty program a great success in creating a grassroots movement of authentic and engaged supporters who are aligned with our ethos of democratising power rather than rewarding ‘spruikers’ sharing misinformation.
As a company, Power Ledger has always been open and accountable. We’re a registered company and did so intentionally under Australian law to bring legitimacy to the broader cryptocurrency space. We’re extremely proud of how we’ve conducted ourselves and we believe our bounty program, and all promotional activities since, have followed the rules and regulations set out to protect consumers.
The article suggests Power Ledger continues to pay ‘spruikers’ who share rumours as part of our bounty program. This is incorrect. Our bounty program ended over a year ago and was audited to ensure no fake, duplicate or misleading accounts received rewards. We also actively took steps to correct any misinformation circulating in the market.
As of October 2018, Power Ledger commenced a community advocate program. This is entirely unrelated to the bounty program and uses a different model. The community advocate program was developed to help protect our supporters by incentivising them to report fake or spam accounts while also correcting any misinformation in the market by being active in forums. This program rewards one community member each month with $100 AUD worth of POWR and $100 AUD donated to a registered charity of their choice. Again, we have always been open and transparent about this program.
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Last modified: May 20, 2020 1:19 PM UTC