It's been a volatile few days for Bitcoin, the cause of which was summarized well in Greg Landegger’s bitdigest - traders liquidating bitcoin options following the Coinbase IPO, announcements regarding Turkey banning bitcoin payments, and temporary shutdown of Chinese mining rigs for safety precautions. Coinbase (COIN) closed today only down slightly, down 2.65% from Friday’s close, while Bitcoin is down 9.4% over the same period. In talking to Seth Ginns, Managing Partner at Coinfund, he pointed out that the market recognizes the fact that increased volatility leads to increased volumes and that we are seeing Coinbase trade on its fundamentals instead of simply as a proxy for Bitcoin.
Moving on to the Metaverse - now THIS is what we have been waiting for! New Tools to Build the Creator Culture from Epic/CORE, Epic Metahumans and Nvidia’s Omniverse!
Leaving Guggenheim in 2018 was a difficult decision to make - first of all, Alan Schwartz inspired me that it was ok to be a creative-at-heart in the midst of finance people. Second, when we started the journey, it was too early to convince most people in traditional finance that content economies would be popping up outside of walled gardens of all types. And that if we peeled back the layers of these content economies, many would be backed by Bitcoin and other blockchain currencies, because the next version of the internet would protect user privacy, and move software developers and creators to the front of the line. This would enable them to garner more of the value chain than was possible in the old world controlled by publishers (like traditional video game companies) and advertisers (facebook and google).
“The keyboard is going to become even mightier than the pen pretty soon. The world, in some sense, belongs to coders.” - Gavin Wood, Creator of Polkadot and Kusama, and former CTO of Ethereum
The two pictures below summarize what provided the necessary push to leave and create a new kind of firm, taken from this first 2018 Medium blog post - No New Blockchains and NFTs in Gaming — No Copy Cats! The picture on the right was a Topshop ad, which reminded me of the picture on the left, a popular Fortnite skin for girls that I had seen. Which came first? Clearly the video game girl! That must be why Epic Games is making billions of dollars on “skins” which are effectively just a new form of social capital, akin to something I would buy at Topshop back in the day.
Source: Fortnite Source: Topshop
If interested, here is a follow up primer on NFTs from 2019 when I was working with my good friend Charles Myers, Founder & CEO of our sister company, Signum Global Advisors, a policy advisory firm.
Back to what happened this week - Core was launched in collaboration with Epic Games as a space for game development and an arcade of free play for users. I was lucky to meet the CEO of Manticore a year ago and was blown away with how quickly this tech allows average people and kids to merge on the highway of creating games - and the graphics are so pretty! Lana Lux, the Core game developer, pictured above, described her journey to find her passion for game development. She first tried a sensory deprivation tank, Burning Man and buying a motorcycle. In the end, she landed on a simple concept -
“What I really enjoy doing is creating. And communicating with people through art and experience seemed like the coolest form of communication that you could do so I was really taken by it (game development.)”
One of Lana Lux’s games, Strain, is a narrative survival game which takes place in an apocalyptic city, during a pandemic and the currency is TP (toilet paper!) While Strain was built using Unity and took her more than a year to complete, Lana is using Core when she wants to take a quick break and have some fun building a game. Star Rancher, a casual farming game in which eggs are harvested and creatures are hatched and traded for coins, is a great example of a Core game - check it out here!
Lana Lux’s experience as a game developer was instructive - first, she played with Flash and Javascript, and then she dabbled in creating games and porting them to the App Store and Google Play. And then she realized that she really loves being immersed in a world. She learned Unity and was then introduced to Core. In describing the differences, she noted that Core was a lower entry point to start building games. If she wanted to develop her own unique art style, she would use Unity, but if she wanted to get moving on creating a multi-player game quickly and easily, she would use Core. She mentioned that Core is a good testing ground. All in, I interpreted her comments to mean that she could create a higher volume of beautiful, and surprisingly complex games, even if they did have a similar look and feel to others. Back to Topshop, perhaps an analogy is that Core is the fast fashion of game development?
And in describing her creative process and how she both codes and creates the art in games, her point on how she engages her community really struck me because in addition to the tech, her process also adds to creation speed, another reason we believe that we will likely see more and more people enter the field of game development and creation. As Lana codes and creates the art in her game, she is constantly iterating based on real time feedback from the chat. Essentially, she is channeling her community and listening to signals, which means the community is imbued in her game. (Note to self: speak to Lana about the idea that this is a perfect venue for a social token!)
Other Core game developers noted in this helpful video -
“If I wanted to make an MMO or any multi-player game before, that would be a huge undertaking. Core made that a press of a button” - BryceLovesGaming
“The best thing about Core right now is the ability to prototype projects really fast -BenEast
“It simplifies a lot of the struggles that you have in creating a multi-player game, whether it is client server communications. All of that is taken away and handled by Core.” -Shhhteve
“In five minutes you can tell it that you want 16 players, invite friends with a link, and all 16 of you are in the same world running around and seeing each other. The terrain system is second to none. I have never dealt with a terrain that is as buttery smooth. Adding arches and foliage and trees. You get on your 3D horse and run through the professional art asset with flowing grass and trees and you go, wow I made that in five minutes” -WaveParadigm
What else happened over the last week? So many things - Nvidia rolled out metaverse building tech for Enterprises, and the MetaHuman Creator tool is out!
We had a lively discussion at the ARK Invest Brainstorm on Friday about Nvidia’s new product, geared to engineers. Omniverse is based on 3D data-sharing standard Universal Scene Description, originally created by Pixar and later open-sourced. We believe this will be complementary, not competitive with Epic’s Unreal Engine and Unity. Its also exciting to think about all of these new technologies’ ability to expand beyond gaming.
Game development is one of the most complex design pipelines in the world today. I predict that more things will be designed in the virtual world, many of them for games, than there will be designed in the physical world. They will be every bit as high quality and high fidelity, every bit as exquisite, but there will be more buildings, more cars, more boats, more coins, and all of them — there will be so much stuff designed in there. And it’s not designed to be a game prop. It’s designed to be a real product. For a lot of people, they’ll feel that it’s as real to them in the digital world as it is in the physical world. - Nvidia CEO Jensen Huang
Finally, Epic Games launched early access for the MetaHuman Creator tool after an overwhelming response when they unveiled the tool in February. It allowed users to create two MetaHuman sample characters, and early access users will be able to use it in Epic’s Unreal Engine. Yes, these are software creations, not real humans! Dean Takahashi made a very important (and likely surprising) point which underscores our view that Unreal Engine 5 will be showing up in all sorts of simulated universes, in games and beyond gaming. Dean commented, “This version of the MetaHuman Creator tool itself cannot run in a game; it is an external content creation application. The MetaHuman assets it generates are for real-time use in Unreal Engine.”
Source: Epic Unreal Engine
Other Recent Highlights in the Press
Video Games
Resident Evil 4 is coming to VR – Since the game’s original release on GameCube, Capcom has ported Resident Evil 4 to virtually every platform possible. Now the groundbreaking survival horror game is coming to a new device: Facebook’s Oculus Quest 2 virtual reality headset.
Oculus launches subscriptions on Oculus Quest VR headsets – Subscriptions are the rage, with the success of services like Xbox Game Pass, Netflix, and Disney+. The subscription model has had mixed success in games, with services like Apple Arcade having mixed results and Game Pass growing rapidly. Facebook’s Oculus division has launched subscriptions on its Oculus Quest and Oculus Quest 2 virtual reality headsets.
NFTs / Digital Assets / Crypto
Binance Burns a Million BNB Tokens – Crypto exchange Binance announced that it has burned over 1 million BNB tokens, worth about $595 million, in its latest quarterly burn. "Burning" refers to the process of permanently removing a crypto token from circulation. When Binance launched BNB in 2017, it committed to burning a total of 100 million BNB, which is half of its supply.
SuperWorld teams with Props for selling NFT virtual real estate – SuperWorld is a the virtual world in augmented reality that enables users to buy and sell virtual real estate, using nonfungible tokens, or NFTs — the buzzword of the internet.The company said today it is integrating Props as its loyalty token. The integration will enable SuperWorld users to unlock benefits within the SuperWorld virtual world.
Esports
Game Developer EA Launches Game Show – Electronic Arts recently held a two-episode run of its new community-driven game show “The FIFA Global Series FACE-OFF.” The event concluded in late March after several celebrities and esports influencers went head-to-head for cash prizes. Electronic Arts also released four episodes of the show “The Sims Spark’d,” where top influencers took part in an in-game reality show during the summer of 2020. According to EA, that series generated the second-highest percentage of female viewers compared to all other Eleague shows that aired on the Turner Broadcasting Systems TV network.
Tencent Hopes To Compete With NBA With Esports Arena Plans – Tencent, a Chinese multinational corporation, recently announced plans to build a billion-dollar esports venue in its home country. Tencent has made several recent moves to increase its presence in the esports industry. Furthermore, it is betting that esports will attract and maintain the internet audiences it needs, allowing it to expand to a size comparable to the $10 billion-plus NBA.
Generation Esports raises $10.8 million to grow student esports leagues – It has built a platform for staging esports leagues, tournaments, and other events. The company will use the funding to support Generation Esports’ multiple community and student esports initiatives, including the High School Esports League.
Other Emerging Tech Disruption
Verizon unveils Hyper Precise Location service in more than 100 markets – This Hyper Precise Location (HPL) service could fix the location of an electronic device with centimeter-level accuracy. It is a great technology with real benefits for game developers and players, but it may also pose privacy issues because it is more precise than some people want.
Nvidia unveils 8 new RTX GPUs for workstations and laptops – Nvidia unveiled eight new Ampere-based graphics processing units (GPUs) for workstations and high-end PCs. The GPUs are targeted at millions of artists, designers, engineers, and virtual desktop users.
Other Emerging Tech Acquisitions
Microsoft buys speech recognition firm Nuance in a $16 billion deal - Microsoft announced it will buy Nuance Communications in a $16 billion deal, or about $19 billion including debt. Nuance makes money by providing speech recognition and transcription software for clinic visits, customer service calls, and voicemails. Microsoft said Nuance’s technology will be used to augment Microsoft’s cloud products for health care, which were launched last year.
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