Discord Discussions & Polkadot POAPs, FaZe Moons, Epic Chap. 3, Ubisoft Quartz, Environmental DAOs, AWS Shut Down - Good Example on Why Web3 Matters
Bits of Signum | 12.8.21
One of our themes at Signum - Valuable Communities are Bottoms up and Organically grown. There is a gold rush into NFTs. Some of the headlines make sense to us, such as celebrities with an active fanbase. As artist Michah Johnson put it at the Christie’s Tech conference, “Buying is in the new liking.” NFTs offer the ability to shrink the distance between creator and fan. Also, a smaller number of engaged fans can be more valuable than a larger number of passive (including bot) fans. There seems to be a gap in understanding in the way some big companies rush in - without a community, NFTs truly are just jpegs, and most likely, money will not follow. Quantifying the creator economy: Stripe tracked 50 of the most popular creator monetization platforms, and found that creators will soon pass more than $10B in earnings. The pandemic helped fuel the growth of the creator economy, and 2021 followed with another year of explosive growth, up 48% thus far. See SOCIAL TOKENS below with recent news from FaZe Clan, P00ls, Luvanthony, and Felicia Day.
Speaking of Communities, DISCORD - BIG NEWS! Note: Over the coming weeks, Signum will be hosting a series of interviews with Discord communities - on Discord of course. Please stay tuned for links. The first session will be over Zoom given most of our readers are not Gen-Z!
Discord officially announced the release of a Premium Membership which will allow creators to fully or partially paywall their servers on the platform, giving them the ability to tier subscription levels, in addition to access to Discord's suite of analytics. TechCrunch reported that Discord plans to take a 10% cut of paid membership subscriptions, though that number could shift in the future depending on how its experiments in creator monetization go. Patreon, for reference, charges between 5-12% plus a 2.9% payment processing fee fee. This announcement came shortly after Discord announced app discovery, which will serve as a marketplace for the 12,000 verified bots of the 430,000 total already on the platform. Discord confirmed there are 150 MAUs in the blog post as well.
Our Take: Creators are currently monetizing their communities using Discord servers in a variety of ways so it makes perfect sense that Discord will start to monetize as well. We are seeing the most creative ideas in the crypto community, with thousands of NFT and DeFi communities calling Discord home. A great example of a non-crypto community that was highlighted in the press today is Eagle Investors, a Discord community with 250,000 members, one of the largest finance focussed servers on Discord. Eagle’s executives say the chat platform allows them to cater to a growing population of investors, many of whom may be new to the markets. Creators are constantly looking for ways to engage with their fans, and this feature will let them take care of their memberships in the same place they are engaging with fans. Discord brings the user closer to the creator than current subscription services - this make the platform simpler, and bring revenues that flow to other services to Discord itself.
Social Tokens & NFTs
FaZe Clan has partnered with crypto payments firm MoonPay to enable millions of users quick access to the crypto and NFT economies. “At MoonPay we’re building the world’s most advanced and intuitive payments solutions for buying cryptocurrencies and NFTs. And FaZe Clan’s influence in the gaming community is unrivaled. This exciting new partnership holds the potential to create a crypto-gaming juggernaut, the likes of which the world has never seen.” said MoonPay Ceo Ivan Soto-Wright. This collaboration will involve the creation of a series of media and content tailored to the Faze Clan community including new original content franchises, creator and talent driven events, and campaigns that tap into fandom across FaZe Clan’s esports teams.
Our Take: There are limitless creative ways in which NFTs could be integrated into esports, events and content creation. At the Esports Awards a few weeks ago, we were in search of the esports and gaming people who were early adopters in crypto. Alas, it felt as if it was still early as skepticism was high. We would bet that FaZe’s innovative move will be viewed as quite prescient in a year or two.
P00ls is a social token startup similar to Rally and Roll, which has raised $18M in seed funding (um - wow) led by Global Founders Capital, with participation from investors including L2 Ventures, Shift, Maveron and Kima Ventures. The platform launched $ISH in collaboration with Blond:Ish at Art Basel last week. Pool is different because fans don't purchase creators' tokens directly, but instead earn the token by being an engaged member of the community. Other social token news:
Actress Felicia Day said in September that she decided to launch a creator coin $GEEX in lieu of fundraising through Patreon and has since outlined benefits token holders get, which include special access to the audio area on Discord, audio hangouts and an exclusive book club with her." Twitter launched its Patreon-esque model, "$uper Followers, in September.
Luvanthony, a TikTok influencer (10.5m followers) on Wednesday announced its $LUV token using Rally.
Our Take: The potential to generate recurring long-term income can reduce the risk of pursuing a creative career, which in turn may increase the number of people entering this nascent market. "In the US, the number of creators earning a living wage (>$69K/year) has increased 41% year-over-year. As mentioned, on Friday in the ARK brainstorm, we discussed some of the shifts in the labor force which have not been picked up in the numbers such as many young people entering the workforce as entrepreneurs - this is a great example of this.
Gaming
This weekend marked the end of the second chapter of Fortnite. Similar to the transition from Chapter 1 to 2, the previous island literally flipped over during a live event. As reported by the Verge, "the game was down for hours as players stared at their characters adrift in a vast ocean. Once the downtime was over, players washed up on the shore of the new island," and chapter 3 officially began. The most dramatic change is the shift to a fresh, snow-covered island, one that features weather conditions, along with new locations like "The Daily Bugle," a reference to where Spider-Man works. The new battle pass will enable players to get their hands on characters like Spider-Man and The Foundation, voiced by Dwayne "The Rock'' Johnson.
Our Take: Chapter 3 is significant as it is the first game featuring Unreal Engine 5. Also, it will be interesting to watch whether Spider-Man as a playable character will attract a younger group of players. This new season also rewards players with Battle Pass XP (Experience Points) for spending time in the Creative Mode, where players now spend almost 40% of their time. This echoes our continued thesis that creators (and developers) are moving to the front of line. Watch a recap of the event marking the end of Chapter 2 here.
Ubisoft is launching a new NFT platform based on Tezos, called Ubisoft Quartz. The NFTs, which are called Digits, will be launched in beta with Tom Clancy’s Ghost Recon Breakpoint on Ubisoft Connect for Windows PC, and will represent in-game vehicles, weapons, and other items. Digits will have unique serial numbers that keep track of ownership, allow players to personalize their gaming experience, and may be resold outside of the game. Players in the beta may only own 1 Digit NFT, must be 18 years or older and XP Level 5+. Ubisoft chose the Proof of Stake blockchain, Tezos, to provide infrastructure because of the platform's innate environmentally-conscious design.
Our Take: This is an exciting step forward from publishers given, until recently, they have mostly been reticent to even discuss blockchain, and given Ubisoft Quartz could onboard a fresh audience to NFTs and blockchain, through gaming. Current NFT market participants are used to jumping through hoops and spending hundreds of dollars on transactions to mint new pieces of art, but the average person is not. Tezos is clearly leaning into a lot of the spaces that we are excited about, all under the general banner of culture - video games, music, sports and F1!
Environmental DAOs
DiatomDAO is a defi protocol which aims to clean the world’s oceans by tokenizing pollution. The protocol is based on OlympusDAO, a “decentralized reserve currency” that came out last March and has amassed a large following, sustaining the project's $700M treasury. Diatom has partnered with environmental organization, CleanHub, which verifies amounts of plastic saved or recycled by certain companies, similar to Carbon Credits. Diatom is making a market for these Plastic Removal Credits (PRCs) credits by storing them on-chain, using the Olympus “liquidity blackhole” to fund organizations voted on by the DAO. From Nov. 30th onwards, 50 Whalez NFTs give auction winners access to the $DIAT token sale as well as act as a funding kickstart for the DAO’s treasury. WhaleZ have sold upwards of 100 ETH to buyers like Brock Pierce.
Our Take: Diatom is the not first OHM-based protocol aiming to help the environment -- Where Diatom helps oceans, KLIMA, which was invested in by Mark Cuban, tokenizes carbon credits and stores their value on-chain, in an attempt to “short squeeze” the Carbon Credit market. After 2 months, the Klima treasury has accrued 11.6M Base-Carbon-Tonnes (BCTs). For both Diatom and Klima to sustain momentum and have a lasting impact, they will need faithful communities to maintain a liquid market, so that the Carbon Credits and Plastic Removal Credits can bring in value over time. Also, recently we have been very intrigued by new AI technologies which are based on human behavior and aim to take human conflict of interest out of the equation in valuing DAO participants rewards - stay tuned for more on this topic when we host John Clippinger in Decentraland soon!
Why Decentralization Matters
On Wednesday at around 10:30am EST, Amazon Web Services, which accounts for 32% of the cloud computing market and hosts 90% of the largest gaming companies servers, went down for almost 8 hours. Popular games like League of Legends, streaming services like Roku, and payments apps like Venmo were inaccessible. Even decentralized derivatives exchange, dYdX was down for most of Wednesday. Though claiming to be decentralized, and illegal for U.S. citizens to access, core servers in the dYdX protocol run on East-1, the network of AWS servers that halted. Bigger than a crypto exchange, the AWS malfunction affected Amazon e-commerce, halting warehouses with malfunctioning scanners, delivery apps, and more.
Our Take: Events like these reveal the critical infrastructure flaw of centralization that spans across all industries. While Amazon may have an edge on cheaper and better cloud services, moving away from these centralized companies will result in a more robust tech ecosystems, less conflict of interest (advertising) between consumers and producers of information, and simply, a better version of the internet for all.
That was a lot but this space is moving quickly. I am looking forward to seeing you all in person (even if on Discord about Discord next week!)