The next Hollywood film you see might be financed with cryptocurrencies.
Christopher Woodrow, who has helped produce or finance movies for the past decade, says the distributed-ledger technology known as blockchain is about to disrupt the film industry and he wants to be a part of it.
The producer of the Oscar-winning film Birdman, as well as Black Mass and Hacksaw Ridge, plans to launch his own blockchain-based token called MovieCoin in the first quarter of 2018. Funds raised in the sale, or initial coin offering, will go toward financing a portfolio of movies. Investors will benefit as the tokens, which can be traded in the secondary market, would appreciate based on the success of the films, Woodrow said.
“We’re trying to revolutionise the way films are financed,” Woodrow said in a telephone interview. “Hollywood is relationship-driven and what we bring to the equation is the ability to gain access to the highest levels of film finance. We’re in the process of putting together a slate of projects that will include A-list movie stars, top-tier directors, seasoned and established producers, and that will form the initial slate for MovieCoin.”
Hollywood hitmaker plans to fund next blockbuster with cryptocurrency
The target is to sell 100 million dollars of tokens that will be compliant with Securities and Exchange Commission regulations. Woodrow declined to name the movies being considered for the portfolio. Just like ICOs have given retail investors access to cutting-edge technology projects that used to be reserved to venture capitalists, Woodrow says tokens can also democratise film financing.
Woodrow is the former managing director at Prospect Point Capital, which invested in venture capital deals in the entertainment industry. He also worked at Citigroup Inc., Oppenheimer & Co. and CIBC World Markets in investment banking and portfolio management.
This isn’t the first attempt at bringing blockchain, which is used for verifying and recording transactions, to show business. Flixxo wants to create a decentralised video sharing network akin to YouTube funded through its token. Pop star Bjork said she’ll accept bitcoin and other cryptocurrencies as payment for her most recent album, and along with any purchase, she’ll give away AudioCoins, a cryptocurrency to be used on a decentralised music streaming platform that rewards fans and artists.
Startups have raised over 3 billion dollars in ICOs, more than venture capital funding, issuing wildly volatile tokens that can just as easily increase their value many times over or crash in a matter of days. The SEC has warned investors of fraud. Bitcoin, the first and biggest cryptocurrency, has soared more than 700 percent this year and jumped to a record of almost 8,000 dollars.
The crypto fever has spurred comparisons to the infamous Dutch tulip bulb mania of the 17th century, where prices surged before collapsing. The analogy cuts close to home for Woodrow, who was executive producer of the movie Tulip Fever this year.
Despite the irony, the former head of Worldview Entertainment says the value of the tokens’ underlying assets will protect them against a wild fluctuations in prices and a potential crash. MovieCoin will be issued on top of Bankex, a platform for asset-based tokens.
“We can’t ignore that some cryptocurrencies are being issued in a speculative manner, which could create a bubble,” Woodrow said. “The alliance of Bankex with MovieCoin will mitigate that risk by underpinning our cryptocurrency with tangible assets.”
You may have to wait for the movie to find out.
— By arrangement with Bloomberg View
Published in Dawn, ICON, January 14th, 2018
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