Nine bet big on crypto by launching its own masthead. It’s not going well

In August last year, Nine’s Pedestrian Group bet big on the crypto hype cycle and launched its own masthead. Six months in, and the site has published false claims as fact, drawn lacklustre traffic, and become the source of editorial tension among staff across the business, sources say.

A recent scandal brought those tensions to a boil. In early February, Buzzfeed News revealed that a Twitter user by the name of @LittleShapesNFT went viral for a series of tweets claiming that they had been in a car accident, fallen into a coma for five months, and woken to discover they had lost $100,000 to the collapse of crypto exchange FTX.

Several crypto sites covered the Twitter thread unchallenged, including Nine’s The Chainsaw, which offered readers an exclusive interview with the user on January 3, where claims were published as fact. 

After the claims were revealed false, The Chainsaw published a follow-up story on February 3 alerting readers to the hoax: “Unfortunately, it turns out that the entire story was a lie.” The original story remained live until February 13 without a correction.

Pedestrian Group said The Chainsaw has “strong, published editorial policies” that have been in place since the site launched, which led the team to publish the follow-up story. 

“There was an oversight in not altering the original story, which we have since done,” it said.

Pedestrian Group, which is owned by Nine, launched The Chainsaw after Business Insider’s German-owned parent company, Insider, opted against renewing its local publishing licence with the group earlier in the year. 

The site, which has an editorial staff of four, was launched as Australia’s “first web3-focused news site” with a promise to “sort fact from fiction” on developments related to blockchain technology across “all platforms”, according to Nine, at a time when the industry was on the out. It was the first non-licensed publication launched by the group since Pedestrian.TV, nearly 20 years ago.

As 2022 drew to a close, Bloomberg was forced to explain to readers “all the ways that crypto broke” in the previous 12 months. Countless instances of fraud and scams, topped off with the misuse of customer funds by and eventual collapse of one of the world’s largest cryptocurrency exchanges, FTX, left relations between the industry and regulators frosty.

For The Chainsaw, the first six months in operation have been “slow”, said sources who spoke to Crikey over the past week on the condition of anonymity for fears of retribution, as hype around web3 has tapered off and given rise to media coverage of the industry coloured by scepticism.

Monthly readership numbers for The Chainsaw pale compared with the rest of the group’s publishing slate, sources said, which includes Vice and Refinery29 in Australia, along with Gizmodo, Kotaku, Lifehacker and Pedestrian.TV, and has been a slow burn on other platforms, too. 

On Discord, an online community messaging platform, The Chainsaw’s posts often go without reply for days, and its Twitter account posts roughly 10 times a day to some 50,200 followers, of whom fewer than an average 0.01% engage with its tweets. 

Pedestrian Group said leadership expected it “to take some time” for The Chainsaw to come close to the traffic numbers clocked by the group’s other, established brands. It had shown “impressive growth” on social media platforms, “particularly TikTok”, where The Chainsaw’s web3 news round-ups get an average of about 600 views, and have attracted about 1200 followers.

All the publication’s social media accounts, except for TikTok, once belonged to Business Insider Australia, and were rebranded The Chainsaw after its launch. Content was deleted but followers remained.

“Wins” presented by the site’s editors in monthly editorial meetings often consist of rare moments of virality on social media, or kudos from a respected member of the web3 community, sources said. 

The Chainsaw isn’t alone in fighting for a shrinking crypto readership. Search activity for the topic in Australia returned to 12-month lows following the collapse of FTX, according to Google Trends, while a flooded pool of well-established competitors continue to outperform major newsrooms and break some of the biggest stories of crypto’s most recent meltdown.

Even still, the publication intends to persist, with a view to be “in a great position” to serve young readers with a “passing interest” in web3 when the market bounces back, said one source close to leadership. 

It’s expected by some editorial staff at Pedestrian Group, however, that advertisers will soon begin to lose interest in The Chainsaw, sources said. 

Last week, Pedestrian Group CEO Matt Rowley told an all-staff meeting that the business would be making moves to cut costs, one source said. Among the first to go was a Chainsaw event, which has been shelved for later in the year.

The unofficial line on the postponement, which was set to go ahead as “Chainsaw Fest” in March, was kicked to August with the hope that “inflationary pressures” would be more forgiving later in the year, one source said. 

Rumblings within the tent have steadily escalated in recent months, sources said. Editorial staffers across Pedestrian Group have grown concerned The Chainsaw’s “booster” approach to web3, a space fraught with scams, posed a reputational threat to the journalism published by other sites.

Some of those publications are gently crypto-sceptic; others, doggedly so. 

Staff writers at Vice’s “Motherboard”, for instance, have long positioned themselves as crypto watchdogs, even as the asset class made its way into the mainstream. Gizmodo and Kotaku, like their US counterparts, are relatively crypto-sceptic too, along with the group’s flagship site, Pedestrian.TV.

Crypto criticism in the office, however, has become something of a taboo, sources said.

Late last year, a number of editorial staffers were warned against criticising web3 — including blockchain, crypto, NFTs, and anything related to the metaverse — after staff at The Chainsaw became outspoken about feeling “unwelcome” as a result of crypto-scepticism in the office.

Some of Pedestrian Group’s crypto-sceptics have grown disillusioned over The Chainsaw’s launch, sources said, and fear the worst of the fallout was yet to come, particularly given Rowley’s keen personal interest in the project.

As it stands, the website is led by Samantha Howard, a former public relations manager who once counted FTX founder Sam Bankman-Fried among her clients, along with managing editor Dale Warburton, who moved to The Chainsaw from news aggregator Crypto News Australia.

Rowley regularly involved himself in the day-to-day running of the site as well, sources said, as the group awaited the arrival of a new publisher. Before being installed as Pedestrian Group CEO in 2019, Rowley was responsible for all digital and print advertising revenue at Nine. 

“From day one The Chainsaw has approached the web3 space from a journalistic perspective, with a key mission to help readers sort fact from fiction,” Pedestrian Group said. 

The Chainsaw’s mandate was never to be a “cheerleader” for the web3 space, said one source close to leadership, who pointed to the website’s various “scam” tags, where “more than 70 articles” have been filed to alert readers to the various ways they could be duped. 

“In the same way that Pedestrian.TV and Vice have built distinct voices despite both covering youth culture, The Chainsaw is building its own voice within the Australian ecosystem, covering the topics young people want when it comes to sorting fact from fiction on web3 and the future of the internet,” it said.