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RSK, a subsidiary of IOVLabs that describes itself as the “first open source smart contract platform secured by the bitcoin network,” announced that it is buying Spanish social media platform Taringa, gaining access to the site’s 30 million users.
The acquisition will incentivize users to share content in exchange for cryptocurrency rewards via IOVLabs’ RIF token, which was released in November 2018 and has a market cap of $46 million, according to CoinMarketCap. During that private sale last November, the company claims it raised 22,000 bitcoins, which was worth roughly $140 million at the time and $175 million today. The Taringa acquisition gives RSK a convenient foundation of users for applications it’s developing with that capital.
Taringa has a prominent presence in Latin America and Spain and is based in Argentina, where it’s used by 28% of internet users according to Statista, ahead of Snapchat, Skype and LinkedIn. With Argentina, Venezuela and other Spanish-speaking countries in the midst of economic crises, Gibraltar-based RSK is betting that citizens will flock to a decentralized alternative for securing their finances.
“If you go to the first world and you start talking about bitcoin and decentralized platforms, you need to explain why. In Latin America, you don’t need to explain why,” IOVLabs CEO Diego Gutierrez Zaldivar says. “People understand why instantly, so they jump right into the how and who. It’s a different reaction. That’s exactly why we chose this social network.”
Although bitcoin and blockchain have become more widely-recognized terms in the last half-decade, Zaldivar acknowledges it’s still a niche industry. The number of blockchain wallet users globally is still just 40 million worldwide, according to a Statista report in August.
Facebook’s Libra plans could make cryptocurrencies more mainstream, but that project still has complex regulatory hurdles to clear before it sees the light of day. If RSK gets wallets implemented on Taringa’s platform sooner, it could instantly come close to doubling the number of people with cryptocurrency wallets worldwide.
“The crypto space has had trouble at times trying to reach audiences outside of its core community of early adopters and visionaries,” Zaldivar says. “This is a big opportunity to learn how to turn these communities potentially into shared economies and bring these technologies to the masses.”
Zaldivar hopes the ability to test decentralized applications on Taringa’s 30 million users will help RSK’s developers more easily identify what works well and what doesn’t. Most enterprise blockchain startups write smart contracts on the ethereum blockchain, but RSK is hoping to make it work in the bitcoin ecosystem on a much larger scale.
The smart contract startup is already developing its first feature for Taringa that it expects to deploy in the second quarter of 2020. Like most social networks, Taringa has some particularly active users, creating content that gets shared on a Facebook-like news feed and in more than 1,000 active user-created communities that group people with common interests. With RSK’s help, those content creators will be able to monetize their contributions.
“If you are a social network user now, all your activities and the value that you create on that social platform, you don’t get a real reward for that,” Taringa CEO Matías Botbol says. “When we implement the crypto in our communities, the user can be part of the value.”