Marketing Bitcoin to the Masses: Selling 21 on Ignorance

[yenxz]

21 Inc’s strategy seems to be to take an exciting, hard-to-understand technology, and market the shit out of it.

Now, don’t get me wrong. Marketing is essential to just about every business and is a good thing when used responsibly. Plenty of companies out there market their products and brands they way they should be.

And then there are the companies that don’t. Specifically, I’m referring to 21 Inc, the company behind the 21 Bitcoin Computer. They make numerous claims on their website that I have issue with:

“Plug in your 21 Bitcoin Computer to get a stream of bitcoin on your Mac, Windows, or Linux laptop.”
“The 21 Bitcoin Chip means your 21 Bitcoin Computer has access to a constantly replenished source of bitcoin.”
“…you can now write programs that connect to the Bitcoin network just as easily as they connect to the Internet.”
“…it’s a tool for making passive income at home by selling access to your software and assets for bitcoin.”
All of the above are true statements, as far as I can tell. But they are misleading true statements. Here are my rebuttals:

The computer/chip will not net you any profit in mined bitcoin. There are too many people out there with far more power to mine bitcoin, vastly lowering your chance of earning anything.
See above. Any money earned (say, through a mining pool) will be insignificant.
This has always been possible. In no way is this new.
If you have a product to sell in exchange for bitcoin, then you likely have a product to sell for dollars (or other currency). If your customers only pay via bitcoin, then there are many,many,many options out there for receiving bitcoin. Want to avoid the fees? You’d better plan on earning more than $80,000 to justify buying a $400 computer for your payments system (based on Stripe’s 0.5% fee structure). Oh, and there are some great open source libraries to do this for you for free. No specialized hardware needed.
Some people argue this will revolutionize IoT. Really? Our toasters will be buying/selling on our behalf? Will I be pimping out my coffee maker to my neighbors? All jokes aside, this can all be done with just a Raspberry Pi.

“Bitcoin-enabling” everything could have some useful applications, but I don’t see this as a practical way forward. For example, a hardware implementation of something like the bitcoin protocol/blockcain could be useful in IoT (or computing in general) if it was used for general purpose transactions, like messaging (see Ethereum). Unfortunately this isn’t the case, nor is this how the product is marketed.

Maybe I’m being overly critical of a first-gen product, but I just don’t see why this is useful or why its been getting so much attention. Essentially, you’re paying $400 for a Raspberry Pi ($40), an under-powered mining/blockchain chip, and some pre-installed software.

Just take a look at the Hacker News comments on this. To me, that says it all. This is a developer-focused product, and the developers aren’t impressed.

To summarize why I’m disappointed:

The misleading marketing speak
The $400 price tag
The amount of press backing up the misleading claims
The ridiculous amount of funding with little to show
I hate to be critical and not offer an alternative solution, so here is what you should do instead of buying the 21 Bitcoin Computer:

Buy a Raspberry Pi
Install Bitcore
Buy and attach one of the many USB miners
Install BFGMiner
Good luck, have fun.

I write at stackabuse.com, tweet from @ScottWRobinson, and occasionally post code to Github.

Scott Robinson

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[unamis76]

I agree... It's just too much hype for something that already seems to be available for a much smaller cost. As I've said on other threads regarding this, I don't really see what does this machine do, or why will it enable better coding of Bitcoin related apps/programs.

It's a bit of a novelty, something that one might buy because it's funny and new. It's definitely not something important to enter the world of Bitcoin... Let's see how this goes.

[NorrisK]

Does it all really matter? If you don't like it, just don't buy the machine.

What it will be successfull in, is increasing the number of nodes. I think that will be the biggest gain for the network from this machine.

[RealBitcoin]

I already had a marketing proposal to mass adopt bitcoin, the probem is that we cannot start anything until the blocksize is resolved.

We dont want to market bitcoin, and then get our asses handed to use because the backlog and transaction speed decrease.

We want the blocksize raised in a stable manner, then push for total bitcoin promotion.

[knowhow]

Well marketing has a huge power ,that makes you buy something you dont need ,21 century computer ,for who mines and know the costs ,marketing will pass away but for those who arent inside well they will buy it just dreaming to make 1 btc montly soo would roi into 2 months.... wont happen im pretty pissed that someone make something and uses bitcoin to damage it again,what you think will happen when those costumers see how much they are getting and the bill coming to pay.... who will pay for this stupid promotion .....bitcoin.

[RealBitcoin]

Well marketing has a huge power ,that makes you buy something you dont need ,21 century computer ,for who mines and know the costs ,marketing will pass away but for those who arent inside well they will buy it just dreaming to make 1 btc montly soo would roi into 2 months.... wont happen im pretty pissed that someone make something and uses bitcoin to damage it again,what you think will happen when those costumers see how much they are getting and the bill coming to pay.... who will pay for this stupid promotion .....bitcoin.

That is not true, it doesnt make you do anything, it just suggest you to do anything. People have to realize the differene between forcing somebody to do someting vs persuading somebody to do something.

Marketing is perfectly moral, ethical, and effective way to connect supply & demand. So it should be the same for bitcoin too.

[maokoto]

What it will be successfull in, is increasing the number of nodes. I think that will be the biggest gain for the network from this machine.

Good point there. It will be good in that respect.

But newbies may expect to get/mine more bitcoins than they will actually get with this machine.

[knowhow]

Well marketing has a huge power ,that makes you buy something you dont need ,21 century computer ,for who mines and know the costs ,marketing will pass away but for those who arent inside well they will buy it just dreaming to make 1 btc montly soo would roi into 2 months.... wont happen im pretty pissed that someone make something and uses bitcoin to damage it again,what you think will happen when those costumers see how much they are getting and the bill coming to pay.... who will pay for this stupid promotion .....bitcoin.

That is not true, it doesnt make you do anything, it just suggest you to do anything. People have to realize the differene between forcing somebody to do someting vs persuading somebody to do something.

Marketing is perfectly moral, ethical, and effective way to connect supply & demand. So it should be the same for bitcoin too.

Look im not against marketing,but those tools make you choose a thing always,wich chocolate you buy at market the cheaper or the kit kat or nestle?Usually you choose those that has announcements,even if the taste is the same,now more then ever we are choosing the cheaper. This project of 21 century computer isnt magical as they sell it what i mean.

[Mickeyb]

What it will be successfull in, is increasing the number of nodes. I think that will be the biggest gain for the network from this machine.

Good point there. It will be good in that respect.

But newbies may expect to get/mine more bitcoins than they will actually get with this machine.

But to give $400+ just to be able to run a node! I don't understand this and I don't see many people doing it. I mean this is a cool device to show off to your friends but what can it give you back for your money is still a bit unclear to me.

[RustyNomad]

I think the way they are doing their marketing might cause them more harm than good in the long run as its clearly misleading.

Some will purchase what they have to offer expecting to make a 'decent' amount of bitcoin and I just cannot see this happening, at least not enough to even cover any costs associated with it. Once disgruntled people start taking to social media to complain their days will be numbered and they will lose all credibility.

[Q7]

Like they say, a good marketing guy can always sell sand to an arab. You can have an average product and do your best to convince the buyers or another way you focus your strategy selling only towards specific group of buyers. Looking at their strategy, it is obvious here that their target are the newbies having very little information on what mining is all about. Eventually I don't think it is sustainable in the long run. Either this pool of people will dry up or eventually people soon start to realize they don't get what they are paying for.

[7788bitcoin]

I too think that the computer is too expensive to start with. I will consider getting one if the price is $200. But I must admit that this is perhaps a good start for beginners who want to get involved and experience bitcoin mining and hosting a full node. I did spent about $800 on some ASIC and only managed to mined less than 0.5 BTC. However, the experience was fun.

[Come-from-Beyond]

May be related to the topic - http://aakilfernandes.github.io/the-frightening-future-of-embedded-mining/

[LiteCoinGuy]

The computer/chip will not net you any profit in mined bitcoin. There are too many people out there with far more power to mine bitcoin, vastly lowering your chance of earning anything.

Scott Robinson

Scott, read their FAQ. they say the same.

[pedrog]

The machine is intended for developers not general public, it's a tool for people who want to develop bitcoin stuff and are well aware of how it works and profitability.

[NorrisK]

What it will be successfull in, is increasing the number of nodes. I think that will be the biggest gain for the network from this machine.

Good point there. It will be good in that respect.

But newbies may expect to get/mine more bitcoins than they will actually get with this machine.

But to give $400+ just to be able to run a node! I don't understand this and I don't see many people doing it. I mean this is a cool device to show off to your friends but what can it give you back for your money is still a bit unclear to me.

It will be the apple within bitcoin. Pay a premium to have the same functionality than if you would spend half or less on a similar product

[ashour]

I don't think that the 21 bitcoin computer is aimed to the masses, it is more aimed for the tech and bitcoin savvy people who want to build app with bitcoin/blockchain.

[btcxyzzz]

But to give $400+ just to be able to run a node! I don't understand this and I don't see many people doing it. I mean this is a cool device to show off to your friends but what can it give you back for your money is still a bit unclear to me.

And this is the only reason why majority of people will buy it, and in the other hand, for majority of them $400 is nothing, sum so small they spend on sport shoes regularily, and this is the cool hip hyped device. This company may pray that there is enough of such sheeple to cover their costs for production & marketing, and I can almost bet there are.

[Kakmakr]

I think their new angle on this, was to say this is a <Smart contract enabler> not a mining computer. It's a bit of a novelty gadget for the developer market. I just doubt that it was their initial intention when they started with this.

It would be cool, if this took Bitcoin a step further into the mainstream market, if it succeeded to mine a few coins. The first computer to pay for it self, would have been a great marketing tool.