With Bullish’s acquisition of Coindesk raising a potential conflict of interest, some in the industry are raising questions about editorial independence.
CoinDesk has established itself as an independent, often hard-hitting news organization covering the cryptocurrency sector.
For context, CoinDesk investigated FTX’s solvency before breaking the news in Q4 2022. Just a few weeks later, the once-popular crypto exchange filed for bankruptcy. Sam Bankman-Fried, former CEO, was found guilty of all seven criminal charges in late October 2023. Sentencing is scheduled for March 2024.
Jason Yanowitz, founder of crypto news outlet Blockworks, took to X on November 20 and said that CoinDesk’s editorial integrity could be affected by a new owner tied to a specific blockchain project.
Yanowitz compares this acquisition to Binance buying CoinDesk or BlackRock buying Bloomberg. In any case, the founder believes that he “crushes the editorial integrity of the brand”, even predicting that “all the journalists will leave within six months.”
In the founder’s opinion, journalists may self-censor consciously or not when reporting on news related to the owner’s business or its competitors. Furthermore, readers could also lose confidence in CoinDesk’s neutrality.
Bullish acquires CoinDesk
Bullish, the cryptocurrency exchange backed by EOS creator Block.one, signed a deal to acquire leading cryptocurrency publication CoinDesk from Digital Currency Group (DCG) on November 20.
The deal, which will reportedly be all-cash, will see one of the crypto industry’s most prominent news sources come under ownership of a Block.one operating company. Its reputation is somewhat confusing, as the company is accused of abandoning EOS development.
EOS raised $4 billion in 2018 to develop technology aimed at rivaling Ethereum (ETH), but has faced criticism for its centralized governance.
Block.one is reported to be one of the largest holders of Bitcoin and owns more than Microstrategy, the business intelligence firm.
DCG’s legal problems
The deal comes at a precarious economic time for DCG, CoinDesk’s former parent company. DCG founder Barry Silbert has acknowledged the difficulties for startups in accessing capital following severe headwinds in 2022.
DCG filed for Chapter 11 bankruptcy protection on January 20, 2023 in the United States Bankruptcy Court for the Southern District of New York. The filing came after the collapse of its subsidiary Genesis Global Capital, which provided cryptocurrency trading and lending services.
While the deal is a liquidity relief for DCG, Yanowitz maintains that financial reasons do not justify compromising editorial standards vital to journalism.
