Tezos Demonstrates Decentralization Here-and-Now ~ Polkadot Parachains Lucky Day 11.11 ~ More NFTs - Beeple.Brands.Burgers
Bits of Signum 11/15/21
Beeple in 3D
Experiencing Beeple's Human_One in person at Christie's 2021 Evening Sale was an incredible "physi-digi" experience. Imagine a large block of glass and steel on what would seem to be a lazy susan-like turntable sitting in the room. The life-sized digital astronaut was plodding across a changing terrain, mostly alone, other than a couple of intermittent cameos from characters like Pokemon's Pikachu. The sculpture is designed to be turned on continuously, with Beeple having remote access to the screens at all times, and of course, it comes with an NFT for the owner. Christie’s auction price for Human_One was estimated to be $15M, but a bidding war brought it up to the ending price of $28.9M. See Christie’s interview with Beeple here.
Tezos demonstrates what decentralization looks like
An interesting event last week highlighted the importance of true decentralization. Tezos-based NFT marketplace, Hic-Et-Nunc (HEN), which means “here-and-now”, was discontinued without warning on the 13th by its solo developer, Rafael Lima. Within an hour, the HEN community had put up two new front ends, Hicetnunc.art and hen.teztools.io. Though Lima had full control of the platform’s contract, he only shut down the UI to display the NFTs, and thus all tokens were safe. Users can still see and trade their NFTs on the new front-ends, which were able to be deployed so quickly because the code behind HEN (along with most of the other critical components of the Tezos ecosystem) is open-source.
This was not only an important demonstration of decentralization, it was also important as Hic-Et-Nunc was the #1 dApp on Tezos, with almost $7M in volume over the past month and a steady user base of about 30,000 artists and collectors.
The point of decentralization is that no single entity can censor or shut down a platform. Prior to the shut down, Lima was in full control of HEN and took a commission from all NFTs traded on the platform. Members will now likely come together to rebuild HEN with proper components like a multi-signature wallet, and to provide a way for collectors and artists to participate in governance. If they do not, another Tezos application should take up the marketshare slack.
Tezos is a leading protocol for clean NFTs, due to its use of Proof of Stake, producing a fraction of a percent of the emissions generated when compared to minting an NFT on Ethereum. The 2nd most popular dApp on Tezos is also an NFT marketplace, OBJKT.com, which had 13.16k users in the last 30 days and $13.5M in volume.
HEN NFTs are developed using the FA2-SmartPy implementation of the FA2 (TZIP-12) token standard contract specification, which is based on the ERC-20 (fungible), ERC-721 (non-fungible), ERC-1238 (non-transferable), and ERC-1155 (multi-asset contracts) token standards. Thanks to these decentralized standards, HEN users have a chance to make Tezos the home to a thriving and fully community-driven NFT marketplace.
More NFTs: Play-to-Earn grabs traditional publishers
During EA's Q3 earnings call, CEO Andrew Wilson called NFTs and "play-to-earn" blockchain games the future of the industry. Backing this up, EA recently launched a search to hire a Sr. Director, with a portion of the job posting highlighting the position's focus on "new business opportunities, including fantasy sports, blockchain and NFTs, and more." Wilson also noted that EA and its FIFA franchise have become culturally significant in the soccer world, but today's digital fans "want more modalities of play inside the game, which go beyond just straight 11 on 11 football. They want more digital experiences outside the game, esports, NFTS, broader sports consumption and they want us to move really, really quickly." EA's Ultimate team represented 29% of EA's net revenue during fiscal year 2021, and FIFA Ultimate team was a majority of this revenue. With the integration of NFTs, FIFA and EA's other sporting games could evolve to integrate trading cards and collectibles with a fully-interactive video game. While EA has not yet launched an NFT or blockchain based game, AAA gaming studios acknowledging play to earn as the future reinforces many of our core beliefs, and reinforces why we invested in Mythical during its Seed round.
This announcement from EA came in both the earnings report and during the earnings call itself, shortly after Ubisoft announced its plans to both invest in and develop blockchain games. Ubisoft previously invested in Animoca Brand's $65M round. These announcements were quick to follow those of last week when Valve banned blockchain games on Steam, and Epic's CEO Tim Sweeny's response that Epic will blockchain games. Activision Blizzard and Take-Two Interactive also reported earnings this week, but neither have broached the subject of blockchain-based games yet.
More NFTs: Empowering Fans
Patreon is a company whose mission is to grow the connection between fans and creators. Important themes at Signum Growth Capital are “Creators to the front of the line” and “Buying is the new liking,” a quote of NFT artist Micah Johnson that demonstrates the way in which super fans are getting closer to content creators. In this vein, Patreon allows fans to engage in the work they love by purchasing monthly memberships from their favorite creators, in exchange for exclusive content like early access, physical goods, or personal “Thank You’s.” Patreon CEO and co-founder Julian Gutman spoke on a panel for the 2021 Creator Economy Summit last week, and when asked about Patreon's plans to integrate crypto, he noted, "there's some fundamental technological components to NFTs as a way to sell value to your audience and sort of continue to gain value from that from secondary sales as what you do becomes more and more important to the world.” This comes after the company presented the idea of creator coins to its community last September. Notable creator coin companies like BitClout, Roll, and Rally allow users to have a stake in the creator's success through buying a creator's personal coin.
While the company floated the idea of integrating a social token into its ecosystem in September, Gutman seems to be focused on the viability of adding NFT technology onto its platform, rather than a social, fungible token. NFT technology allows creators to publish and sell content that can be traced back to the point of publishing, making provenance and continuing royalties possible. NFT technology can decrease the reliance creators have on marketplaces and other central intermediaries in distributing their content, hopefully allowing creators be paid fairly while focusing on what they do best.
More NFTs: Empowering Music Artists
Another space in which this "creator first" ethos is critically important is the music industry. When looking at potential use cases of NFTs for the music industry, it is important to look at how artists monetize their content. In a 2017 paper titled “Blockchain and Creative Industries,” RMIT professors Jason Potts and Ellie Rennie noted, “There are two benefits to that disintermediation. First, it lowers cost by embedding operations in software. But second, it also pushes access and control over the relationship to the edges, to the artist and fan directly, which is a further source of value creation.” What this does is strengthens the connection between artist and fan, creating a sort of governance model with blockchain under the hood. Potts and Rennie refer to this as a “social operating system.” Platforms like OneOf, Royals, Audius, YellowHeart, and more are doing their part to disintermediate the label-run music world. OneOf launched in August of 2021 and has already coordinated drops with Alesso, Chief Keef, The Game, and Doja Cat. NFT-based Music platforms may be in their infancy, but many are beginning to explore the way technology can change the industry’s landscape.
On the Lighter Side - Burgers go Big
Watch the number of mainstream brands entering the space. Nike is entering the Metaverse with virtual sneakers and apparel along with a job listing for Virtual Material designers, and Disney + and VeVe announced plans to offer "Golden Moments" NFTs, which will be golden versions of icons owned by Disney, including Marvel, Pixar, and Star Wars. McDonald's is bringing back the McRib to stores as both a sandwich and an NFT, and Burger King has partnered with Robinhood to help reward customers with Bitcoin, Dogecoin, and Ether to their BK Royal Perks members. Even the insurance agency State Farm partnered with the NFL to deliver an NFT football scavenger hunt, accessible through smart phone cameras!