It's not friendly competition between The Block's Mike Dudas (left) and Cointelegraph's Jay Cassano (via The Block and Cointelegraph).

Exclusive: Inside the fight The Block’s Mike Dudas picked with Cointelegraph

Allegations of “pay-to-play” cryptocurrency journalism downgraded to ad sales shenanigans.

The feud-prone founder and CEO of cryptocurrency media site The Block has backed down from allegations that one of the largest news portals in the industry is guilty of “pay-to-play” journalism.

In a Dec. 4 Twitter post, Mike Dudas called a newly announced partnership between Cointelegraph and a client “shady as hell.”

The @mdudas post continued, “My jaw hit the floor as I read about the pay-to-play arrangement. Competing projects should be aghast, and editorial integrity must be questioned at this point.”

A shot across the bow

While he’s no longer making the pay-to-play accusations, Dudas switched targets. He’s still suggesting Cointelegraph played fast and loose with its editorial integrity. But it’s the advertisers who are being promised things they shouldn’t be, Dudas now says. 

Cointelegraph has been at least sideswiped by allegations of questionable activities on the sales side of the editorial firewall before. 

Words matter

The specific target of Dudas’ Dec. 4 attack was a press release posted on Medium that day by blockchain platform VeChain announcing a partnership deal with Cointelegraph Consulting—a non-editorial division of Cointelegraph.

Poorly worded at best, the Medium release referred sometimes to Cointelegraph Consulting and other time to just Cointelegraph.

It read, in part, “In this partnership, Cointelegraph will collaborate with VeChain on several fronts. VeChain and Cointelegraph will co-brand and co-produce industry reports on enterprise blockchain adoption… the core goal of this partnership is for Cointelegraph to specifically matchmake between enterprises and VeChain’s Blockchain Solutions.”

Dudas was referring to that language when he suggested Cointelegraph had breached the firewall should separate a legitimate media company’s journalism division from the business side. That includes ad sales, but also any other parts of a company selling any product or service.

The accusation Dudas made was a serious one, particularly given the numerous allegations of questionable journalism ethics in the global cryptocurrency media industry.

Cointelegraph Editor in Chief Jay Cassano (via Cointelegraph).

It was also wrong, Cointelegraph’s new editor-in-chief, Jay Cassano, told Modern Consensus via email.

“There is an absolute firewall between the news Cointelegraph publishes and Cointelegraph Consulting, just as there is between editorial and the advertising sales team,” Cointelegraph’s new editor-in-chief, Jay Cassano, told Modern Consensus via email. “It is a wholly ‘business side’ operation with neither input from nor influence over the editorial team.” 

He said that none of his reporters or editors would be working on reports or matchmaking with VeChain.

A change of targets

Asked to respond to Cassano’s comments, Dudas backed off the allegations that Cointelegraph was offering pay-to-play access to the editorial team. 

Which isn’t to say he backed down. 

Instead, Dudas suggested that Cointelegraph Consulting wasn’t making the distinction between editorial and sales clear enough to its clients.

“The customer explicitly stated in their Medium posts—which took on the form of almost a press release—that they would be receiving… introductions and other specific services from Cointelegraph as an organization,” Dudas told Modern Consensus. “[Cointelegraph] clearly didn’t make it clear to their customer what entity they were dealing with.”

The Block's Founder and CEO, Mike Dudas (via The Block).
The Block’s Founder and CEO, Mike Dudas (via The Block).

That’s the reason The Block doesn’t offer consulting services, Dudas said. 

“It’s impossible to run a truly independent—as Cointelegraph likes to say—editorial organization at the same time that you are effectively selling your services to promote … specific projects,” said Dudas. “It’s extremely troublesome.” 

Of course, The Block has had credibility problems of its own recently. 

As Modern Consensus reported on Nov. 25, Dudas got into a Twitter war with Binance cryptocurrency exchange’s CEO, Changpeng “CZ” Zhao, after The Block had to retract a key part of a story claiming that Binance’s Shanghai offices had been raided by police.

Given China’s current crackdown on the cryptocurrency industry, the police involvement would have been a serious escalation. It was by far the most significant part of the story.

However, when one source told The Block of the police presence, its team didn’t try to confirm that with other sources. After Zhao denied everything, The Block went back to those other sources. They denied the police involvement, and The Block had to “update” the story.

Cointelegraph was the publication to break the story, Cassano pointed out.

Other firewalls failed

Attempts to breach the firewall between editorial and sales are not uncommon in the cryptocurrency news business. 

In July, Modern Consensus reported that the BitForex exchange tried—unsuccessfully—to bribe us to take down unflattering stories. 

As unethical requests go, it doesn’t get much more obvious than this.

However, allegations of similar approaches succeeding are also common.

The worst of those reports came in an article published on October 25, 2018, by Breakermag. A well-respected but defunct news site, Breakermag investigated the pay-to-play allegations by creating a fake PR representative who made pay-to-play offers to two dozen competitors.

The article’s title speaks for itself: “We Asked Crypto News Outlets If They’d Take Money to Cover a Project. More Than Half Said Yes.”

Cointelegraph was one of the sites approached, and it did not take the bribe. But, BreakerMag reported, an ad salesperson directed the phony PR rep to other—editorially independent—news sites that would. 

Who’s who

Cassano said that the media division of Cointelegraph is not involved in the partnership between VeChain and Cointelegraph Consulting in any way. 

If you accept that most of the references to “Cointelegraph” in the VeChain release really mean “Cointelegraph Consulting,” the report can be read that way.

It isn’t a stretch. The title clearly refers to a partnership between VeChain and Cointelegraph Consulting. 

The third paragraph refers to “the media conglomerate’s” 8.8 million monthly readers and 1.35 million social media followers, and operations in nine languages. It then said that this “uniquely positions the newly formed Cointelegraph Consulting to be able to utilize this prominent network and experience for driving the adoption of blockchain innovations into enterprise ecosystems.”

Asked specifically if Cointelegraph’s media operations, reporters or editors would be working with VeChain, Cassano responded, “[o]f course not.”

Cassano added, “I would never tolerate a company directing questions that journalists should ask or telling journalists what they may not ask. I’ve quit jobs over less.” 

Indeed, the Columbia Journalism Review reported in February 2018 that Cassano was one of nearly 20 reporters and editors from Newsweek and the International Business Times to quit Newsweek Media Group in February 2018 after three Newsweek colleagues were fired. Those three had been on a joint team investigating the publication’s parent company.

Updated at 2:49 pm on 12/09/19 to correctly identify that the three fired journalists were from Newsweek, and to update the story with Cassano’s note that Cointelegraph was first to report that Binance’s offices were not raided by police.

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Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics. Disclosure: Jakobson has put some 401k money into Grayscale Bitcoin Trust.