Wrapped BitClout Moving Forward

By @sigil



TLDR;



  • On April 26, 2021, at approximately 1:50 AM EST, Adrian Ciaschetti initiated a rug pull on the @wBTCLT account. Adrian liquidated over 300 BitClout and left @wBTCLT investors with tens of thousands of dollars in total losses.

  • We want to clarify that we had no prior knowledge of Adrian’s rug pull, nor did we collude with him in any way to defraud investors. Adrian was not a member of the BitSwap team and we were also shocked after learning of his rug pull. 

  • If anyone has been wrongfully done or you have lost money from wBTCLT, email me at admin@bitswap.network. We are brainstorming ways to help offset losses though it's best if Adrian can take ownership over his own actions and return the money back to his investors.

  • Moving forward, we pledge to improve our communication and transparency with the rest of our community & trust within the parties we choose to work with





Building BitSwap has been the most rewarding learning experience of my life. For the past 3 weeks, my cofounder Aryan and I have been spending all of our waking energy on solving BitClout's offramp problem and bringing BitSwap to fruition. In the process, we faced many trials and tribulations- learning how to lead a team of 10, write a whitepaper, build product, talk with investors, and establish trust within the community - all to varying degrees of success while having BitSwap tied to our name.



“Embrace accountability, and take business risks under your own name. Society will reward you with responsibility, equity, and leverage” -Naval Ravikant



Taking the risk of building in public is an idea I read personally in the Almanack of Naval Ravikant, and I have begun to internalize this quote as I continued to actuate BitSwap. It's not easy taking on the risk under your own name - especially on a platform like BitClout, where everything is public on a blockchain. It became clear that doing so rewarded us with trust from the community and leverage - something much harder to come by otherwise.



It takes many good deeds to build a good reputation, and only one bad one to lose it. - Benjamin Franklin



As I built out my own & BitSwap's reputation on the platform, I learned that reputation is something slowly built up over time, and something that could be ruined in one instant.



Unfortunately, I also learned that the actions of those with who you choose to associate yourself can hinder your own reputation.



This makes choosing the right business partners with high integrity incredibly important.





Shortly after beta testing BitSwap, I received a message from @adrianc from @cloutify who was working on wrapping bitclout as an ERC20 Token - enabling bitclout to interface with decentralized applications.



At the time I was researching into developing a decentralized exchange in which a wrapped bitclout token would be an integral aspect.



From chatting with Adrian over discord messages, seeing his progress with deploying the wrapped bitclout smart contracts on a test net, and getting feedback from him on the BitSwap whitepaper, we were willing to trust and work with him on leading wrapped bitclout’s development. Supporting the project, I believe I bought into the @wbtclt tokens at ~$2000.





As we finished up the development of our V1 platform that allowed for the instantaneous swap of bitclout and ETH, I followed up with Adrian frequently to check in with his progress. However, Adrian was unresponsive which brought concern to the state of the wrapped bitclout project and the speed of its development.





On April 25th, I was tagged in a post by @Davidsun about changing the ticker for bitclout from BTCLT to BCLT which had great community support.





Seeing the post by @davidsun, I began to reevaluate the progression of @wbtclt. With our V2 decentralized exchange halfway finished and little progress updates from Adrian on @wbtclt, I questioned the need to rely on someone else to build it out - viewing this as an opportunity to finish up building wrapped bitclout ourselves in conjunction with BitSwap V2 with a new @wbclt account. The new plan was to leverage wBCLT as the first custodian to test wrapping bitclout. Then we would open-source wrapped bitclout code, and possibly create community governance facilitated through the wBCLT token itself, turning the project into a DAO.



After buying the new wBCLT coin with BitSwap, sigil, and aryanm accounts, we saw investors flock in and speculate what the project could be.



Key Learning —> Communication

In retrospect, communicating our reasoning for launching the wBCLT token is important. We aimed to take over the wrapped token project ourselves which we did not communicate to anyone yet - leaving everyone to speculate for themselves.





I believe that after Adrian came across the wBCLT (top traded token for a period of time), he saw us taking on the project as an opportunity to drop his wBTCLT project. I, however, cannot speak for Adrian.



This morning at 1:30 AM EST, Adrian messaged me on Discord, letting me know that he was dropping his wBTCLT project because he "had some personal stuff come up over the last few days".







Adrian provided us with his existing codebase for wBTCLT and subsequently announced that the wrapped bitclout project would be continued by the BitSwap team.



What we didn't know at the time was that Adrian dumped all of his wBTCLT coins and transferred the proceeds of that sale, 311 BitClout (~$50,000), to his own account.



A coin that traded in the thousands, was now down to a couple of dollars each.







I only realized that Adrian had dumped his coin after I woke up in the morning and looked through the messages in my discord group.



Being surprised and confused over what had happened, I did not properly communicate the situation with the rest of the BitClout community. It was only around 12PM (noon) today that we publicly acknowledged the rug pull through our @bitswap account.





As a result of our delayed and inadequate communication, and the fact that we had created the wBCLT account shortly before Adrian's rug pull on wBTCLT, some people thought we were taking part in the scam.



I want to clarify that we had no prior knowledge of Adrian’s rug pull, nor did we collude with him in any way to defraud investors. Adrian was not a member of the BitSwap team and we were also shocked after learning of his rug pull.



Despite this, we recognize and agree that the way we communicated the situation after Adrian’s rug pull was not ideal, and we're in the process of improving this moving forward.



Within my own discord server, I said:



"I've been trying to build on this platform and deliver value to the community for so long and I'm incredibly disappointed in Adrian for harming the bit swap project over with his rug pull. I now have to deal with his actions instead of focusing fulling on developing bitswap. I tied my name to everything BECAUSE I understand that reputation is built over time and unfortunately I also learned that the actions of others can greatly destroy your reputation. I'm learning. I'm trying to build this out for the community. Heck bitswap is not going to take any profits from the project and I'm funding the project out of my own pocket. I don't care about these short-term gains or whatever. I care about generating value long-term for everyone. It's a learning experience for me and I can't change the actions of others. I'm sorry about your financial loss and fight alongside you to get Adrian to refund you. This is not okay for the bitclout community and I do not endorse him at all. I want all your advice on how we can continue building on this platform. The past happened and as much as I can stress and let it impact my emotional wellbeing, I choose to focus on what I can control and do right now."



More than anything, I sincerely apologize for any losses suffered by wBTCLT investors as a result of Adrian's rug pull. Hopefully, this incident does not detract from our long-term goal of providing value to the BitClout community.



If anyone has been wrongfully done or you have lost money from wBTCLT, email me at admin@bitswap.network. We are brainstorming ways to help offset losses though it's best if Adrian can take ownership over his own actions and return the money back to his investors.



BitSwap Going Forward

Am I really building in public? No, not fully yet. I think I still have A LOT to improve on.



Personally, I remember my dad walking into my room and asking me what it meant to be a CEO.



"It stands for Chief Executive Officer," I responded.



"Right Chief Executive Officer... keyword, Execute."



Communication, transparency, and leadership — it's my responsibility. I may only be 17, but now is the time for me to grow up and take ownership over BitSwap. To begin executing.



We are inheriting the consequences of Adrian's actions, which isn't something that I can change.



But, what I can do is focus on how we will operate going forward. How we can ensure better communication and transparency with our community.



Every week on Monday, I aim to publish a transparency update on the status of BitSwap from all of our team members. The goal of BitSwap is to build on top of BitClout and bring legitimacy to both the platform and decentralized social media, together.



If there are major changes in our project, they will be announced on the @bitswap account.



And as BitSwap continues to grow, we want to decentralize power to our users. First, we plan to give coin holders the ability to vote on changes to the platform and trusted partners to work with. Eventually, we aim for BitSwap to become a DAO, where decision-making is decentralized to users through a governance token.



Bitclout may have financial incentive behind it, but what we value most is your trust. That isn't something that easily bought back — rather it must be earned.






I'd also like to personally thank Anurag who respectfully voiced his perspective of the situation within our discord. It's easy to throw accusations without any justifications, but Anurag acted in a civil and respectful manner - the feedback we will take to heart and try our best to implement going forward.



Any questions, comments, or feedback, feel free to email me at admin@bitswap.network

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