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by 3JPLW 2470 days ago
When I first saw this I just assumed it was some sort of spam/scam. What's the rationale for giving away money here? Is it purely Keybase/Stellar marketing?

How is Keybase planning on making money?

2 comments

They aren't giving away money. They are creating these coins out of thin air. The only way anyone is losing money is possibly by deflating the value of existing coins by creating more supply. That these coins are worth anything at all was sort of luck by being early in the race. The top 10 - 20 coins don't seem to change much.

These airdrops were an expectation from the start. The first coins from this organization were also airdropped and they have done other airdrops since.

I'm not a guru in this space, but I believe the idea for Stellar was to be more of a utility coin as opposed to a store of value.

In general, this is definitely something to watch out for.

As far as I understand it, that's not the case here, however. These coins were already in existence held by Stellar, who is now giving them away. I.e. no coins being printed.

I see airdrops regularly, and this is the first one I have not dismissed as a waste of time and attention right away. Unless they mess it up somehow, I think this is a great move by Stellar - I think the people using Keybase (especially combined with GH/HN) are exactly the early-adopters-power-users they want to extend adoption to.

Why would anyone back a cryptocurrency whose operator can simply whisk new coins into existence?
Unless there's some other factor in place, you probably shouldn't.

This is not the case here, though. Stellar has been sitting of huge piles of coins (par for the course these days at least) that they are now distributing.

This is different from US dollars how?
The US government is ultimately beholden to US citizens, who don't want to get hosed by inflation. People who can't vote in America do actually have a legitimate reason to be concerned: if the US ever can't maintain its debt, it will likely become in the voter's interests to devalue the currency to nothing. That's basically the "default risk" on Treasury bonds.
Approximately 300m people vote for, pay taxes to and support the creators of US dollars, the US government. Approximately 8 billion people recognise the US dollar as a global unit of value exchange which has a known local currency value.

A new cryptocurrency is just a database with some private keys shared remotely.

Creating more of a currency is typically known as inflation. Deflation is the opposite.
Just think of it as Universal Basic Income... get your coinage into circulation, and when people use your coins to exchange value, now your coins have value! So as the coin minter, hopefully you've kept some coins for yourself too, and now you have money!
Yes, I get that. So is Keybase banking on XLM itself to drive their revenue?
I had an account for years, but I rarely used it and didn't even know they had an app now. To qualify I had to install the client on 2 devices and setup account recovery. I am now much more likely to explore the app.
Agreed. I'm checking it out now too.
The Stellar team uses Keybase as their main base of operations. They are the third most popular (2.4k members) Team on Keybase.

https://keybase.io/popular-teams

I'm assuming its a co-marketing campaign in between Stellar and Keybase.