web3 Me
A year-long adventure into the wild, fascinating, often-problematic-but-still-worth-it world of NFTs.
By Gavin Purcell
For the last year, I’ve led a double-life of sorts.
Like many people on the Internet from the beginning of Internet time, I created a pseudonym to dive into a subculture that I wanted to learn more about.
What I didn’t expect was that I’d come to identify with and communicate anonymously with a very large group of people who shared my same interests and in doing so, rekindle my excitement in building something new, rediscover what I love about internet communities and maybe even change the trajectory of my career. At the same time, I found myself disliking some aspects of that culture and wrestled with the issues inherent within it.
This article will serve as my “official” doxxing (connecting my online persona to my IRL one), to tell my story. I hope to explain a bit more about this space and why it’s so interesting to me, despite a number of issues that I’ll dive into as well.
Let’s get to it.
My real-life name is Gavin Purcell and I’m mostly known for my work in television and digital media. But for the past year or so, I’ve also become known as FonkyDonk and have gone deep into the world of web3 & NFTs as both an avid collector and as a creator.
**WAIT DON’T LEAVE**
If you’re not already active in the web3 space, you’re probably rolling your eyes right now.
“No!” you might be thinking, “These things are so stupid, it’s all scams and didn’t the whole market just fall apart? Literally billions of dollars evaporated. Also, FonkyDonk? Wow, good one, Gavin.”
Yes, over the past few months NFTs, web3 and crypto in general have been going through yet another rough patch. Did it all fall apart? Well, that’s a complicated question and I’ll get into some of these issues below.
The name FonkyDonk itself I have no real explanation for.
I wanted to write this to say a bit about what I’ve learned in this space, what I see as the takeaways so far and where it could lead to.
If that’s interesting to you, great. Please read on. If not, that’s ok too!
In what follows, I share my thoughts about NFTs, my experiences with them in the last year and my desire to expand my scope and stay within this space, even in my IRL work.
BEFORE WE START
We should do some very simple table setting.
If you’re unfamiliar with the terms or definitions of “NFTs” (non-fungible tokens), “cryptocurrency” or “web3”, please do some googling. If you’re starting from scratch, there’s a fair amount of stuff to get caught up on.
For now, I’m going to assume most people reading this understand the basic concepts and have a passing understanding of NFTs either from being part of the scene or from the news or whatever. You most likely have a general feeling towards the space and, unless you’re a true believer, it’s probably not a great one. Personally, I believe there’s a lot to like about them, both from an art standpoint and the new sorts of communities & business models that are rising them, and I hope to explore some of these below.
I could try to explain NFTs in general but I’d fail to do the concept justice and likely piss off both the zealots and the haters by what I left out. I will leave it to the thousands of other people that have done this over the past year.
I’m also not really going to talk about my IRL career here much as you can either google me to learn more or even ask me about me on my IRL Twitter account @gavinpurcell.
Very quickly, I have been lucky enough to work at many incredible places, with my longest stints at the original G4tv and then as a founding member of the Late Night with Jimmy Fallon team where I stayed through the launch of the Tonight Show until late 2016 and returned for a year to run the show during the pandemic.
As I start to consider the next step in my career, I wanted to take a moment to really reflect back on this time in my life and also offer up the idea that perhaps there maybe was a reason I spent a shitload of time learning about sellable JPEGs.
Again, this is going to be long, so before we get started I’m going to kind of lay out what I’m talking about in four major sections with three subsections each. Read sequentially, jump around, whatever. I’ve written this to be read from start to finish but you’re more than welcome to just read what you want and get out.
HOW IT STARTED aka My History in the Space
- The Beginning
- The Mice
- The Sheets
THE WHY aka The Reasons I’m Still Here
- The Future is Weird
- Experimentation as an Antidote to Creative Death
- Community Ownership of a Thing
THE ISSUES aka It’s Not All Sunshine and Lollipops
- The “Yes, Sometimes It *Is* a Scam” of it All
- The Gambling / Dopamine Culture of Trading
- The Environmental Impact, the Value Prop Conversation & Other Stuff
THE WHAT NOW aka Where We Go From Here
- Learning as a Lifestyle
- Transitions + New Opportunities
- The Metaverse (Yes, I said it)
Ok, let’s jump in.
HOW IT STARTED aka My History in the Space
The Beginning
In January of 2021, right after the insane scene that happened in Washington DC, I happened to see a tweet from a friend of mine, Bryan Brinkman, about NFTs.
Bryan and I had worked together for many years at Fallon (me in my various capacities, him as one of the show’s GFX artists) during both of my stints at the show. He is an incredibly gifted artist and one of the warmest, nicest people you could hope to interact with. Bryan, weirdly, was also the centerpiece of something strange we did during the early days of Late Night called “The Bryan Brinkman Experiment” which involved Jimmy, Kevin Rose & Alex Albrect and Russell Brand (all early Twitter users) following a single person to see how many Twitter followers that person could get. Overnight he got to 35k which back then really meant something.
While I was back at the Tonight Show in 2020, I was vaguely aware that Bryan was into the NFT space but when you’re working on a Late Night show (especially running one) there is little time inside your brain for much else. It was also a difficult time for me as I was in the middle of learning how to manage the show during the pandemic and all the challenges that went along with that.
I had heard he’d started doing work in NFTs and had the vaguest sense of what those were (pictures with cryptocurrency attached?) but it wasn’t until after I left the show in November of 2020 that I started to learn more. And it wasn’t until Bryan’s tweet in January of 2021 that I realized there was something significant going on.
As I started to learn a lot more about it, maybe like two weeks before the entire world started to catch on, I began to get a better understanding of what NFTs were. Conversations with Bryan and another good friend, Jonathan Mann, weirdly a former intern at G4, had helped me see what a difference NFTs could make for artists. NFTs opened the door to ongoing, automatic payments in royalties and could allow emerging artists to make a much more significant living going forward. That they could bring forth new communities of collective ownership around these artists that could lift up and highlight new art of all types.
NOTE: Of course, at the same time, I also got a crash course in the negative issues surrounding both NFTs and Crypto. But I’ll save that for later.
It sounded quite exciting and it felt like the beginning of something pretty big.
Jonathan walked me through how to download a MetaMask wallet, which had, since my last dabbling in crypto, become the simplest and most popular cryptocurrency wallet and proceeded to send me one of his early Song-A-Day NFTs. He showed me how to list it and I sold it on OpenSea, the largest marketplace for NFTs. OpenSea sent the ETH to me minus his ten percent (and the 2.5% fee paid to OpenSea itself).
I explored what else was out there on OpenSea — it was an endless churn of stuff — much of which was pretty junky. I was also super cautious about what I was spending money on as it all seemed a bit iffy. Cryptopunks, the biggest NFT collection at the time, had a floor price (the cheapest available price) of 9 ETH or about twelve thousand dollars which seemed like a fortune for a digital picture. Little did I know, in November of that same year, the cheapest Punk would be worth nearly five hundred thousand dollars.
I dabbled a bit, buying some really interesting stuff from a few small artists. Reedy Vector is one I remember fondly in particular and tried to learn as much about the space as I could. The mainstream came roaring in, news stories circulated and I thought ‘wow, maybe there’s something really interesting here’ and tried to learn about all the unique art being made while not going too crazy.
Life crept on, as it always does, and I saw the space grow like crazy fast over the course of two months, mostly from afar. I bought a few things on Nifty Gateway early on, saw Beeple’s early rise but didn’t invest in any of his pieces, and then watched it all kind of come crashing down in March or so. I was preparing to move back to Los Angeles from New York and basically said “good game” and walked away.
Terrible timing on my part, but alas, hindsight is 20/20.
The Mice
Fast forward to August of 2021. We’d moved back to LA and gotten settled. I’d been hearing whispers on Twitter and other places of various things that had been happening that summer in the world of crypto & NFTs. Most of what I’d heard about was “Defi Summer”, a remarkable blossoming of weird and often semi-sketchy financial vehicles using crypto tokens of various sorts to deliver remarkable returns.
It’s for this reason that I spent my first few weeks back within the terrible, no good world of Shitcoins which I will not delve into now other than to say please, please do not delve into that terrible no-good world. If you don’t know what a ‘shitcoin’ is, please do not learn. You’ll be better off.
Anyways, while I was poking around, I saw that some of my twitter friends had changed their Twitter profile pictures to NFTs. This was super weird to me at the time. I really couldn’t understand how you’d associate a picture, even a specific one you owned, with a real life Twitter handle that was supposed to be representative of you. But there they were and more people were changing them everyday.
So I decided to check out where NFTs had gotten up to. Turns out, there had been a LOT of changes while I was gone.
First, there had been a huge boom in digital art NFTs — many, many amazing artists had launched projects since I’d left. Tyler Hobbs launched Fidenzas, Dmitri Cherniak launched Ringers and even my friend Bryan Brinkman had launched Nimbuds as part of Art Blocks, a company that had formed to help onboard digital artists into curated NFT drops.
There’d been a number of interesting other 10k PFP (profile picture) projects similar to CryptoPunks that had launched over the summer (and that I subsequently missed) like Cool Cats, Cyberkongz and, of course, Bored Ape Yacht Club. Many of these NFTs were being listed on OpenSea, some for what seemed like enormous sums of Ethereum, and so I fired up my wallet again to see what had changed.
I was pretty shocked. OpenSea had transformed from this weird, motley collection of random things to a more organized place, with lots of large collections that were doing pretty well. It seemed to have finally come into itself as the premiere marketplace for NFTs and new projects were launching all the time.
It was at this time that I also started diving deep into Discord, the essential social network of the NFT space, and saw some of the burgeoning communities that were building there. I joined Bryan’s discord early on and got to chatting. I also joined the Supdrive Discord, a project launched by Dom Hoffman, one of the co-creators of the app Vine as well as the creator of Loot, in the hopes of getting on a list to be able to mint that project (which, to this day, I’m still waiting on). I started to see how communities were forming around these projects, holders of specific NFTs getting to know each other in smaller groups.
It was also at this time that my pseudonym Fonky Donk was born. I tried to follow lots of people on Twitter in the space and figured it might be easier just to do it as a new account rather than screw up my main Twitter feed. It was freeing. I could really come at this space with fresh eyes and get a chance to see things anew.
And then I learned about the Anonymice mint.
I had been DMing with Andy Milonakis, the comedian/rapper, about the space a bit as we’d been Twitter acquaintances for some time and we’d simultaneously noticed we’d both been paying attention to NFTs. This was in early September of 2021 which was really and truly the golden age of NFT discovery. Things were going wild.
I DM’d Andy about an interesting mint I saw called RugStore, a literal mint of pictures of rugs on-chain (meaning that the art and the NFTs were hosted on the Ethereum blockchain and not on a third party server) and he responded positively and, a few hours later, sent me the following DM.
And, with that exchange, I was on the path to my first big moment in NFTs and a community that I’m still a part of today.
But first, a bit about the Mice.
Anonymice is an NFT PFP project started by two anonymous founders, later revealed to be two brothers, and founded on strict, almost spartan, ideals. The mint was free to claim (outside of Ethereum gas fees) and the founders collected no royalties. The founders wanted to see what was possible with as pure a project as they could envision, one separated from a lot of the other issues often associated with NFTs and do something interesting that was “just code”. In addition, the founders added a unique wrinkle to the project, a token called “Cheeth”, that you received a steady stream of for “staking” your mice, meaning you sent them to live inside a contract and outside your personal wallet. For a limited time, you were allowed to “re-roll” your Mice (for a certain amount of Cheeth) to get a different one if you weren’t happy with the way it looked. If you re-rolled, your original Mouse was “burned” meaning that it could not be owned by anyone ever.
That all may sound somewhat confusing and when I first encountered Anonymice, that was my feeling as well. My initial take on Mice was that there were clearly people in this world, programmers, web3 experts and others, who were much more up on everything and better understood it than I did. However, as I purchased a few Mice and joined the Mice re-roll, I started to see some of the interesting innovations as more than a foreign language and began to integrate myself deeper into the community via Discord.
It’s important to take a quick second here to discuss the importance of Discord to the world of NFTs. Without it, and, of course, Twitter, I believe that NFTs would never have become what they did. Many people see NFTs in terms of financial values (and we’re going to go in on this later) but one of the most interesting things to me about them is that they represent collective ownership of *something* and Discord is like the physical space / office breakroom of that collective ownership.
Outside of the mint and secondary sales, nearly everything happens in the NFT world within a Discord server. The first move one makes when getting a specific NFT is to find the project’s discord server. It’s in Discord that you’ll immediately get a sense for what the founders of a project are like because they’re generally in there talking to all the people who bought or minted their NFT. It’s in Discord you get a sense of the momentum of a project, whether it’s going to thrive, barely survive or, worst of all, ‘rug’ (more on this later). It’s also in Discord where you’ll meet a lot of other people on this crazy journey with you and, believe it or not, become legit friends even though you refer to each other by your idiotic pseudonyms.
The Anonymice Discord server was not my first rodeo but almost immediately I felt as if there was something special happening there. I had been in other “active” Discords, communities that chatted a lot and constantly had dozens of members present in real time, but very few had the types of people and discussed the sorts of things that were buzzing in Mice.
Because of the unique nature of the project, the Mice mint had drawn in a number of NFT / Crypto OGs, people who’d been in the space for a while, and specifically a number of Cryptopunks holders. The Cryptopunks, aka Punks, were / are some of the most sought after NFTs in the entire space, in part because of their expensive price but also because they were one of the first big NFT projects to catch on, having originally minted back in 2017. They are still seen as the gold standard for NFTs and having one as a PFP means something in this world. The Mice mint had originally been shared in the Punks Discord by Kilo, the older brother, himself a Punk holder and a member of their community. And now a lot of Punks owned Mice as well.
So when ol’ Fonky Donk stepped into that server for the first time, I was barraged by a lot of people who really knew what they were doing and I was impressed by their knowledge of the space. At the very beginning, there was quite a bit of trying to figure out what was going on with the re-roll, what the most rare Mice types were, and more typical chaos I’ve found to understand is pretty common in the Discord servers of new, innovative projects. As it started to settle down a bit, I started to get to know people there, learn a whole lot and began to really have some fun.
As I got to know more of the Mice and the founders, Kilo and his younger brother MouseDev, who wrote all the contracts for the Mice mint, it became clear that this might become a type of ‘home’ for me in the NFT space. I was learning a ton everyday, both technically (learning to read solidity contracts, ‘minting’ NFTs from those contracts) and “financially” in terms of the active trading in the NFT market and how values are associated with various projects and why.
I put “financially” in quotes here because, like many emerging markets, there is a LOT of stuff to sort through in the NFT space when it comes to money, especially in September of 2021 when the market was at its most frothy. Mice were sharing information about what seemed like endless new mints coming along, some people saying to buy, others to sell. I was getting a lot of lessons on the upsides and downsides of turning digital pictures into financial instruments.
One of the most fascinating lessons in this came from the fact that, very quickly, Anonymice became a very valuable NFT to own. I had purchased my two mice on the secondary market via OpenSea for around an average of .35 ETH each. I’m not sure what the actual value of ETH was at this time but let’s assume that each one cost about $1000 dollars. This is a LOT of real world money but in the world of NFTs and the “magical internet money” that is Ethereum, it wasn’t that much relative to others. But it was, by far, my largest purchase in NFTs to date.
Because of the interesting story, tokenomics and ‘code first’ ethos around Mice, the price shot up pretty quickly, getting to around 5 ETH within a week. This immediately made me feel like an absolute genius, that *of course* I was doing the right thing and that I was finally at the right place and the right time when it came to something happening. An overwhelming sense of euphoria swept through the discord, the “only up” mentality that you hear about in the crypto world, and it was, all in all, an incredibly fun time.
Mice ended up peaking around 13 ETH towards the beginning of October and at that point I was convinced, more than ever, that I’d found a new profession. I would become a professional trader of NFTs and I would make more money doing this than I ever could at my still very decent day job and wow how lucky I was to have figured all this out at this exact moment in time!
Except, as it often does in stories like this, it didn’t stay that way. It turns out the smarter money at the time was rotating their NFTs back into ETH as it was beginning its epic run towards the end of 2021 and the price on many expensive NFTs began to dip pretty quickly. Mice moved from 13 down to 10 and then slowly moved further and further down in value over the months of October and November, still remaining valuable but never returned to those early highs.
Anonymice now sits at a floor price (the cheapest available unit of an NFT) of around .25 ETH and ETH is a lot less valuable than it was back then. So, like a lot of people, I’ve lost money on the project but ultimately it is the one NFT where real world value really does not matter to me. It’s become something much more interesting, a community of a lot of people that I’ve gotten to know and a great source of continuing education. As other Discords have gone quiet over the bear market during 2022, the Mice server continues to remain busy every hour of the day as Mice from across the world chat.
I personally took an interest in helping the Mice brand towards the end of 2021 and into 2022, running their Twitter handle for a while and hosting a couple Twitter Spaces each week for them. All of this was on a volunteer basis and something I wanted to do for the project because I believed so strongly in the community and the kinds of people that it represented. It echoed how I wanted to represent myself in the space. Mice were smart, connected, both technically and market-savy, aware of new trends right away and yet… not assholes. I connected my online identity with the Mice, still using my Mice as my PFP to this day, and will likely for some time to come.
I will never sell my Mice and I suspect a lot of other members of the project would say the same thing. Well, I mean I have like four of them now so if they *really* went crazy I’d probably cover my losses but you get the idea.
THE SHEETS
During my time in the Mice server, I met a lot of other people who were looking to start their own projects. One of the most interesting things about the active Mice community is that they were / are actually “builders”, a cliche in the space where everyone seems to be “building” something, But Mice were actually doing it. A number of prominent other NFT projects came from Mice holders or were based on Mice code or ideas (Ether Orcs, Furballs, Wolf Game, etc etc) and the project attracted a number of developers. Kilo & MouseDev were semi-celebrities in the space for creating the project and continued to add a lot to the overall conversation of NFTs as well.
Towards the end of 2021, I was getting the itch to start something myself. It meant a ton to be an early adopter but without digging in on a project of my own I felt like I was missing out. And I was seeing lots of people around me trying different ideas and, as the market was in a down cycle, it seemed like it might be a good time to come up with something new. I wanted to learn what it meant to start something, to really move towards the idea of being a creator in an entirely new sort of media. I’m also a giant believer in putting yourself in creatively experimental places (see the sections below) and knew this was the place to do it.
What I didn’t want to do was create a project with money/value as its ultimate goal. There are many, many projects in the space that almost immediately read as “cash grabs”, projects literally designed only to sell out with little else planned. I was interested in trying something innovative, something that wasn’t your typical cartoon animal PFP, and pushing what was possible ‘on-chain’ and even dipping into other weirdness like Artificial Intelligence.
Luckily for me, I have an old friend who I’d been talking with about the space who is one of the smartest and most creative people I know. We started to throw some ideas around and felt good about where we were going. He had a good friend who is an artist that he recruited into the mix as well. We all agreed that we needed a solidity developer as part of our core group and found someone who’d worked on an innovative project that hadn’t sold out but we’d admired.
We had our team.
Side note on team size: If you choose to make your own project, I *highly* recommend you form a team of at least three people if not a few more. These projects seem deceptively easy at first glance but they are complicated beasts with tendrils deep in technology, creativity and human beings. It’s massively hard for one or even two people to make them work. Sure you can attempt to freelance out some of the work itself but you’re significantly better served having a core team of founders who all share the burden of the project itself. You’re going to need people you can rely on in all sorts of areas. And, keep in mind “team” in our instance meant four equal partners. We all shared in the upside as well as the work.
Side note on the above side note: I also *highly* recommend one of the core members of your team be a solidity developer. Idea people often get on a high horse pretending that it’s the idea/concept that really matters, and yes, it does, but especially in this space you’re going to need someone who truly understands the technology of what’s happening behind the scenes and ideally is writing your contract on their own. They can and will use other code to do so but you want someone who’s going to understand how to make all that work and, most importantly, have a mint that goes smoothly.
Creating an NFT project has many parts but at the very beginning you have to answer important, almost endless number of questions:
- What is the NFT going to be?
- How many of them will there be, aka, what is the size of the collection?
- Will you be focused on art or utility or a mix of both?
- What do the smart contracts look like and who is writing them?
- How much will you be supporting the NFT after launch/mint?
- What is the ‘roadmap’ aka what are you going to tell your potential audience about what you’ll be doing once the NFT project launches?
- How will you launch the NFT — will you have a “whitelist” where you let people know they can mint the project ahead of time or will you do a “stealth” mint where you launch as a surprise?
- Who are you talking to in the space (aka the good Influencer types) to help get the word out?
- Have you done the community work yourself to understand why a project like this might succeed?
- Are you an active member of other communities who will support you and your project?
- What will *your* community look like and where will it be focused?
- Who will help moderate your community in Discord and where will you find those people?
- What will your social media strategy look like?
- How will you price your NFT?
- When will you launch your project?
- Etc, etc, etc
It’s no small endeavor to launch a project, even the tiniest art-only drop has to answer the majority of these questions.
Our team set about trying to answer these questions to the best of our ability, all while drilling down on a basic idea that we found interesting. Each of us brought something different to the project and what became Sheet Fighter really reflected a combination of a lot of our interests and skills. I wanted to do a project fully on-chain thanks to my experience with Anonymice and was super curious about exploring the burgeoning world of GPT-3 and AI content generation. My old friend, a media supermind, came up with the idea of fighting spreadsheets as a very dumb but also smart way to make this funny and real. Ittai, our developer, brought an insane amount of knowledge about on-chain and cross-chain dynamics to the table and how to use GPT-3 from a tech standpoint, and he wanted to make our contract as strong as some of the best in the space. And, last, but not least, our artist KC wanted to make the project look incredible and add-in extra levels of video production and GFX polish to all of our social materials.
I assume, if you’re reading this, there’s a small possibility you’re familiar with Sheet Fighter but for everyone else, where we landed was this:
Sheet Fighter NFTs are 100% on-chain fighting spreadsheets with names and moves generated by a GPT-3 algorithm. In truth, they *look* like spreadsheets but are in all actuality NFTs with specific stats for attack, defense, critical and health, functioning more like a type of video game character rather than a traditional spreadsheet. We trained GPT-3 with a data set of both names and moves letting the algorithm fill in all the absurd weirdness. We have a website that looks like Windows95.
A Sheet Fighter NFT looks like this:
Sheet Fighters were also designed to be ‘battled’, meaning that we would be making an on-chain NFT game to go along with them, where they would fight one another based on the stats on the sheets. In addition, there would be an upgrade mechanic to make your stats stronger as well as a ‘token’ which would be generated by staking your sheets that you could use to enter battles or upgrade your Sheets. On top of all of this, we created a significant comical ‘lore’ around the project, the story behind the NFT, one where a rogue Artificial Intelligence known as Motherlord took over a paper company and made these spreadsheets sentient and eager to fight one another.
The project itself is pretty deep and complicated and I’m not going to spend a ton of time talking about ‘what’ it is, rather more ‘how it got to where it is’, so if you’d like to learn more than what I’ve said above, I encourage you to check out our Medium for the project or the website at sheetfighter.io.
This video also does a good job of explaining a bit about what it is.
As the work on Sheet Fighter got closer and closer to fruition, we’d made a vital choice to do it as a ‘stealth mint’ which meant that we weren’t going to be talking about it or announcing it ahead of time. This is a significant choice in the NFT space, specifically because a lot of brain cycles on projects are spent building hype pre-mint to get people to understand the project and why they might want to spend money on it. Traditionally, a project will launch with some teaser art and a Discord, often months ahead of their mint, in order to build up anticipation across as broad an audience as possible.
However, unlike almost any other medium, there’s something special about the idea of immediate novelty and newness in NFTs. When something comes out of nowhere in a stealth mint, the level of excitement and surprise often takes the entire space by storm, especially if the project is doing something that pushes the ball forward somehow. There have been many great examples of this, Mice, as mentioned prior, being one of the best. Of course, on the flip side, this is also how nefarious projects take advantage of people in the space as some stealth mints can often ‘rug’, where the teams promise something and then disappear, never to be seen again.
It was always important to me that we be upfront about our intentions with Sheet Fighter, that we be clear that we were a reputable team from the start. We were writing a very long Medium post to go live with the mint to explain the whole project. We needed to be legit. And, even though half of our team were not using our real names (myself included), we needed to show that we had built up reputations in the space and were putting them on the line for this project from the start.
Reputations aren’t just for the IRL world. This is something I’ve learned again and again as the undoxxed version of myself. Reputations are something you build over time, chatting in communities, showing your true colors as an individual, even while using pseudonyms like Fonky Donk. There are people in the NFT space that I’ve never met in real life or know their real name that I trust implicitly. There are others who I don’t but I at least have a good sense of who they are. You have to be most careful of the people who have no history: the blank slates, those who have no one to vouch for them. Unfortunately, they are often serial identity creators, people who shift from project to project without a trail.
This doesn’t mean that you can’t enter the space entirely fresh, having no history. I did after all! But it does mean that you, like any new person in nearly any other community, have to earn a reputation before people will begin to trust you. And I was lucky enough to make some incredible friends that vouched for both me and Sheet Fighter on our day of launch.
I feel lucky to count Kodiak, the founder of the Two Bit Bears project, as one of my closest friends in web3. When we met in person in Brooklyn last April for the first time, it was like meeting someone that I’d known for forever even though we’d only been connected since the preceding November. Kodiak was a huge supporter of Sheet Fighter and these are the kinds of relationships you must have to be successful as a creator in the space. I never went into our friendship thinking that he would be beneficial to me, just that I admired what he built. When we chatted, we got along. Build your reputation and connect with people you admire and like, and support will come.
When it came time to launch Sheet Fighter, I relied on a lot of these friendships. I asked MouseDev, 0xInurashi, an early Mice developer, and Poof, a dev from Ether Orcs, to connect with Ittai and have a look at our contracts to make sure we were in good shape. I reached out to TropoFarmer, a prominent name in NFT Twitter and a long-time Mice holder, to tell him about the project as I thought it would be something he might be interested in. I talked to other friends of mine, too many to mention here, about our launch plan and the overall idea and got incredible feedback that helped shape the project.
All of this is to say, that the launch of Sheet Fighter would not have been possible without the connections I made ahead of time. I believe one of my biggest personal contributions to the project was this idea, the seeding of it and the support I got from these people that I did not know IRL and who had become my friends in NFT land. Please do not underestimate the importance of building a community of people around you that trust and support you as a human being. It can make all the difference in the world.
Another significant element the Sheet Fighter team wanted to employ for our launch & for the project was a particular focus on media to help get the word out. This came naturally to me and three-quarters of the team who had backgrounds in TV/digital media and we hadn’t seen it really done in an interesting way prior to our launch. We knew ahead of time that Twitter would be vital to our success, not only what we put on Twitter but how we engaged with people there, specifically the larger influencers in the space.
From the start, we made a big part of our focus on creating media that not only played into our lore but also addressed and chatted with some of these players in order to get the word out. So when we launched, we had a plan to post a semi-traditional ‘launch trailer’, a message from Motherlord explaining the project, but also a number of other videos specifically calling out prominent communities and individuals. These videos would amplify our reach, getting the project seen by a lot more people.
However, the thing that we couldn’t have expected, and truly, didn’t, is that our stealth launch wouldn’t just be something that a few people would talk about. We thought the project might fail to mint out and that we’d be working for a few weeks to get people to learn about the project and we might slowly grow to a full community. We expected Sheet Fighter to be a small, tiny project that people into weird art might get, but that the general NFT world would just find it weird.
Instead, it flew.
Sheet Fighter minted out in under two hours from the contract going live, causing an Ethereum gas spike and dominated the alpha chats for the next day or so. It was a full blown sensation at the time, a culmination of all the stuff I talked about above. It really worked incredibly well, the stealth aspect of it took the NFT world by storm and installed a fair amount of fomo across the board. We hosted a Twitter Space nearly directly following the launch and had hundreds of people listening to us describe our vision for the project, Ittai diving into our innovative tech, and where we saw it going from here. It felt like we were on top of the world.
And, for a time, we were.
I’ll write more later in this piece about the market and how things work and the expectations on projects but I’m not entirely sure what exists right now (or more to the point, what existed in 2021/early 2022) is sustainable long term. But one thing you’ll understand very quickly when you launch a project is that there is always the question of “what’s next” around every corner.
A large part of this is driven by the idea that the value of what you purchase must go ‘up’. Another large part of this is driven by people solely looking to extract value as traders of a project. But, either way, there is a demand on all projects that they are always releasing new and bigger stuff that will make the investment increase.
I knew this after buying and investing in a lot of projects ahead of time and wanted to clearly lay out our vision in the medium post both giving people a sense of what the project would be and where we wanted to go. The Sheet Fighter team wanted to head off this at the pass if possible, tried to really be proactive and show that we were building something cool and different, continue to push our innovative media approach and engaging people on Twitter. We were here and building for months to come!
But, like many, many projects, the attention moved onto other NFTs and people started to sell their Sheets. Not everyone of course, a lot of people had staked in our contract, showing a commitment to the project and to us, our Discord was active and engaging, but the floor price started to come down. As a team, we were working harder than ever to fulfill the promises of what we’d talked about but without news or new products every week, the project slowly started to bleed out.
We’d peaked at a floor price of .25 ETH per Sheet, a remarkable achievement, but by the first week of March, just about three weeks after launch, we’d come back close to our mint price of .05 ETH per Sheet. A couple months later, the price dropped further still when the overall market crashed in late May.
Price does not and should not dictate the overall strength of an NFT project but it does have a remarkable effect on the community and who takes part in it. Unfortunately, higher-priced projects are seen as being more long-term and ‘blue chip’ and those that fail to maintain price are often seen as failures or, worse, ‘slow rugs’ aka a project that looked promising but failed to continue to work at its success.
Sheet Fighter was never a ‘slow rug’ sort of project. It was something we worked exceptionally hard to make and to push forward and continue to do so. The Sheet Fighter team never gave up on making it the best possible version of what we promised it would be. We launched what I believe is a really unique and incredible project that I think should be judged on the whole rather than just for what the value of the floor price is. But is that possible in this space? I’m not entirely sure. It is, after all, a business and if the customers have left the building then it’s possible the business that you had planned wasn’t the right one after all.
Are there things that I would’ve changed looking back? Of course. The team has talked about the idea of perhaps we got too ambitious with what we promised, even though we were clear about timelines, that if we’d done a simpler version without a game or anything, would it have done better? To be honest, I think this version would’ve petered out even faster. What if we’d done the entire project ahead of time and completed everything in our roadmap before the launch? Possible but then we would’ve missed the proper time to launch and we’d have been stuck having put nearly 8 months of work into something that now would have little chance of succeeding.
I could go into detail about what happened over the next six months as we fulfilled the roadmap, built all sorts of awesome stuff, including a weird, kickass cross-chain battling game that’s now live but there’s so much more that I want to talk about. If you’d like a detailed history, come into our Discord and check out our website or one of our battles. It’s been a blast and I wouldn’t give up the experience for the world.
But now that you have a sense of my own personal history in NFTs, it’s time I dive into some specific thoughts about what I see both interesting and problematic about it going forward.
THE WHY aka The Reasons I’m Still Here
The Future is Weird
Ok, so this marks a transition in this article where I move from telling you a bit about how I got here to why I think NFTs are and remain interesting to me right now in October of 2022. As I mentioned in the beginning, feel free to skip around within whichever sections keep your interest.
Before we move on, I’ll share a bit about where the space is right now in comparison to what I wrote about above. There has been a major “correction”, probably more specifically a “crash”, in the overall cryptocurrency market that some say directly corresponds with the world economy collapse and others equate with normal bull and bear cycles in cryptocurrency. It’s likely a combination of both but it’s clear we are currently at a fraction of where the space was even six months ago. A large number of people have left the NFT space in particular, with overall trading volumes on OpenSea down from nearly 5b USD in January of 2022 to 300m USD in September. Financially, we, as a collective, are “down bad”.
I say this to set up my first point about why I believe there’s still interesting stuff happening and continues to happen in this space and why I’m focusing much of my attention towards it:
The future is fucking weird.
It’s no secret that I’m a bit older than most people in web3. People tease me about it all the time. I have lived through essentially three versions of the internet and the on-going, never ending truth of it all is that the future is fucking weird and the only way you’re going to be a part of it is if you stay active in the present where it’s being made.
My biggest regrets both in this space and in other technological revolutions was being interested enough to be aware but not really leaning in as hard as I could. My attention jumped to other things, only to find them later to have morphed and formed into something I could never have expected. And, since I stopped paying attention, I missed out. Often these were in situations where it looked like innovation or progress had stalled but was being made by smaller groups who never stopped working on it. For me, this goes all the way back to BBSes in the 1980s, to early tinkering on the early Internet in college, to blogs and the burgeoning world of web2, to bitcoin (good lord, why did I not pay more attention) to the earliest days of NFTs.
I regret nothing in my life as lived and I’ve been lucky to have incredible experiences both personally and work-wise. But if I’ve learned one thing over my life, it’s that maybe I should stick around when these things pop up because, again, the future is fucking weird and who knows what’s going to happen.
In the present, a group consensus forms about any number of topics based entirely on what past experiences have dictated leading up to that point. Technology is no different. Right now, there are an overwhelming amount of voices declaring the death of web3 as a whole (sometimes even from within the web3 community itself!) and, I will admit, it does not look pretty.
However, there *is* a lot of stuff happening, even now. As someone who’s stayed active and continually aware of what new projects have been minting, I can tell you that new things appear all the time that shock and surprise me.
A great example of this is Goblintown.wtf, an NFT project that launched in the midst of the NFT bear market in May of this year.
At that time, NFTs and ETH were both down significantly from their highs, and many people still in NFTs were referring to themselves as being stuck in “goblintown”, the crypto term defined as a ‘downward trending market’ and weirdly based on a song from The Hobbit.
And then, entirely out of the blue, with a random Friday night stealth launch, Goblintown.wtf was released into the world.
The project was launched via a very unique website, one that had polish and showed it wasn’t a total joke, but, on the other hand, it did lean very much the meme that had overtaken the NFT world, that we lived and toiled in Goblintown with little hope of escape. The art itself was also well done but between that and the website/stealth mint, it wasn’t all that different from projects that had come before it.
Then, came the Goblintown Twitter Space.
Twitter Spaces is a live audio product on Twitter that has become a pretty significant part of NFT culture. It’s the daily radio of NFTs, with on-going shows like Farkoh’s Rug Radio drawing large audiences to discuss and chat about NFTs, the market and other stuff. As mentioned above, the Sheet Fighter team had used Twitter Spaces to chat about our project and to build an audience for what we wanted to do going forward. Mostly Twitter Spaces for NFT projects are teams talking about their plans and where the project goes from here, getting to answer questions from the holders or the general public. It’s a ‘getting to know you’ sort of platform.
The Goblintown Twitter Space had none of that. At first, all people heard was a looping track of rhythmic music, if you listened to it closely, it almost sounded like underground mining. As people piled into the space, wondering what the project was (and as its value was going up on the secondary market), the host of the spaces, the Goblintown.wtf Twitter handle allowed random people from the audience to speak without saying anything themselves.
No one really knew what to do. A couple people awkwardly tried having a regular conversation about the project. Then, randomly, someone who wasn’t the project founder, started talking in a goblin voice. Again, this was just a regular person. Then multiple someones. Before you knew what was happening, like fifteen adult human beings were pretending to be goblins and creating their own version of the Goblintown.wtf story together.
It was one of the most brilliant launches of a product I’d ever seen. The Goblintown.wtf team continued to build upon this with regular spaces and an entire ecosystem that effectively launched a new meta in NFTs around collective storytelling. Rumors swirled that Mike Judge or Yuga Labs, the founders of Bored Apes, were behind the project, that’s how good it was. Later, it was revealed to be the team at Truth Labs, an excellent group of creators, which made a lot of sense. Of course, like all NFTs it raced up in price and then back down, but it came out of the blue and entirely changed what I believed was possible in NFTs.
The future is weird. Don’t miss it.
EXPERIMENTATION AS AN ANTIDOTE TO CREATIVE DEATH
A long time ago, when I was running Attack of the Show at G4, I came up with what I believe is a simple, useful slogan both for creative teams but also for life at large:
“Change it up”
It sounds pretty dumb typing it out now but it’s something that I try to preach to anyone I work with and even repeat it to myself from time to time when I’m in a slump of sorts. It’s *very* easy to get sucked down the pathway of things that have worked well, things that seem like they’ll always work, and to assume you can keep doing that thing forever.
What’s more difficult is to force yourself to change, to do something different and know that you might fail both privately and publicly. Lifting yourself out of your own well worn grooves and trying a different path for a moment is incredibly risky but can also be incredibly rewarding.
I’ve lived through multiple real world instances where I was part of something that had remarkable success at an early-to-mid stage and, assuming that we found the thing that worked, kind of just kept doing it until the success topped off, people got bored and the tides turned. This is inevitable with nearly any endeavor, be it creative or in business. You must be ahead of the change, essentially you must facilitate the change yourself.
Taking the economic question out of it for now, the current world of NFTs is full of creative experimentation. The format is so new that every project is trying to make itself known in *some* way and some of the most interesting ones are starting to pull in elements of other technologies or in-real-life functionality. Sure there are the popular PFP knock-offs and, in the middle of the 2021 bull market, projects could launch that were close copies of others and, because they followed those worn paths closely, they were successful. The need for change had not yet come. Now, you’d better be coming with something unique or different that will drive the market forward in some way or you’re doomed.
The newness of the medium also makes it abundantly clear that there’s a lot of room to push outward in different directions, that the borders have not yet formed around it. Unlike say, film or video games, NFTs are a creative medium that no one has *really* figured out a significant use case for yet outside of verifiable ownership. Yes, there are some basic ideas at play (games, club memberships, art) but I’ll still get amazed at seeing a project as weird and unique as The Descendants, a NFT / AI art project based on a fictional family tree. Is there a business behind this? Who the hell knows but it’s experiment-y as fuck and I found it fascinating.
Granted, this section has more to do with the timing of where NFTs are themselves rather than anything inherent in NFTs at large. It’s the beginning of something and, at beginnings, there is massive room for innovation and therefore extreme experimentation. There is more leeway when it comes to failure and people reward risks at a much higher level. Putting yourself in the cross-hairs of movements like this early on can open you to entirely new things you never thought possible.
I like dropping myself in these spaces. It can feel a bit like walking into an open field after being stuck in the same house for a long time. You don’t really know where to go but there are a lot of things to see and you might as well try going in that direction because it seems like something could be cool over there. It could also be an absolute dead end or, worse, an endless pit where you throw your money and your time. But at least you’re trying something different and moving your life in a new direction.
You may not be the sort of person who needs to do this. Perhaps you’re more than happy to do the same thing or work in the same sort of field for a very long time and that’s totally fine. Honestly, from a financial perspective, it’s probably better overall. But as a creative person, there’s nothing more invigorating than stepping into something totally new and trying it out.
And, at heart, that’s why I’m writing this thing.
COLLECTIVE OWNERSHIP OF A THING
So here we get into the money aspect a bit more and, again, I think it’s worth doing more table setting when it comes to the idea of who owns what in the world of NFTs and how that has translated across different projects. Additionally, I’m going to loop in the idea of “collective ownership” with the idea of a large number of people having a financial interest in something even if technically they don’t own the larger overall entity.
Confused? Welcome to the wonderful world of NFTs.
When you purchase an NFT, you own that particular piece of digital art / whatever it is. Ownership can be proven and verified on the blockchain, and you are free to value it as you wish or to sell it based on the value the market has given it. With some NFTs, you are given the commercial rights over that particular NFT as well. For instance, some owners of Bored Apes have taken the image of their ape and made commercial products out of them. Even more confusing is that *some* NFTs have declared themselves CC0, a Creative Commons designation, that basically means that anyone can do anything they want with the image likeness of any of that collection’s NFTs whether you own it or not. They do not own the verified original of course, and that, in theory, still has value.
On top of all of this, there is the idea of the intellectual property around NFT collections that is often separated from the ownership of the individual pieces as well. Again, using Apes, you have the right to use your Bored Ape in a commercial manner but you cannot use the Bored Apes trademark or represent them yourself outside of your individual ape. Large VC rounds are raised by some of these collections (BAYC raised 450m themselves) based in large part on this IP and their ongoing roadmaps which include more NFT drops and expansion of the properties.
All of this is to say that when you buy an NFT, particularly one in a large PFP collection, there is a sense of ownership (you own that image) and also no ownership (you do NOT own a piece of the company that produced it) and that’s important to understand as I get into talk about the idea of “collective ownership” as one of the reasons I find the space interesting going forward.
For my purposes here, I’m referring to “collective ownership” as the idea that a group of people each collectively own an NFT in a specific collection. Again, owning an NFT does not make you an owner of a piece of the company that produced the NFT, much to many holders’ chagrin. But, because you and your fellow holders have all bought into one particular project you are tied together in a number of ways.
First and foremost, the price of the NFT, specifically the floor price, is something that all holders of a single collection are aware of and participate in. This price is entirely determined by holders themselves because if no one sold or bought, the price would stay stable. Therefore, price is the primary collective action that all holders are responsible for.
Second, there is collective communication that happens within a specific project’s discord, which you often have to verify yourself as a holder to take part in. This is where the project’s founders communicate their vision for the project to those that hold it. It’s also where the holders themselves carve out what will essentially be the public voice for the project. How strongly a holder feels connected to a project in the discord will often dictate whether or not they change their Twitter PFP to that project, how often they’ll mention the project in another discord, etc.
Finally, there is the always elusive “vibe & momentum” part of collective ownership which, while seemingly like individual choice, really is the combination of the community communications and the floor price. It’s an almost intangible aspect of the NFT community, a cloudy idea of where the larger community itself and the NFT world at large feels the project is in the overall space. This has a number of factors: influential and noisy holders, news about where the project is headed next, and lots and lots of opinions often shared publicly over Twitter.
This is a pretty unique scenario when it comes to community ownership and business. The most direct comparison is, of course, the stock market, but while it can feel personal to own a stock, you generally are so far removed from the day-to-day business and the size of your stake is such that your voice doesn’t matter or drive the price in any direction. On the other hand, there is investment in smaller companies where you might own a piece of something that is very small, have a small say in it but only until it grows to a certain size. In both these examples, you are owning an *actual* piece of the business as well, not just one of its products.
In a lot of ways, NFT communities are more like those built around other collectibles such as sports cards, sneakers and toys, where a market has developed for their product, but I can think of no other such market where each particular project is a brand into itself and the owners take on such a significant aspect of the brand’s identity and value.
So why is this interesting to me?
Well, from what I can tell, it’s one of the first times in the history of business that this sort of collective ownership has formed around a large group of strangers, starting from the date that the business has real world value, especially in full blown public view. It’s also one of the first times ever that “investors” have been able to dictate so much about a business from the outside in. And, unlike something like Kickstarter, where you send your money to a company that you think is making something cool in return for a product, with NFTs you always have the option to remove your money if you decide that thing is no longer cool to you, which, in turn, may hurt the business and the brand.
A lot of people would say that this is a terrible model for a business. To have to be this beholden to people who don’t even own a piece of the company makes for terrible management challenges and many NFT projects have struggled with keeping their holders happy as they look to transition to larger business and expand out their footprint. Doodles, a popular PFP project, went through a significant revolt from some of its users this summer when it failed to tweet for a couple of months, making people feel that the project had stopped progressing.
I’d like to argue that this is actually an opportunity rather than a detriment, at least in this experimental stage. Collective action is a massively powerful thing and can drive incredible change and movement at many levels, and I think the NFT communities can be steered in the proper direction as long as the challenges are clearly laid out from the very beginning.
A huge part of this will be about communicating goals from the start and to align with the community as the company comes into itself over time. Years of mainstream brands handling social comms has trained people to interact with them in all sorts of ways and you need to be able to take some of those lessons (authenticity, honesty, crisis management, etc) and bring them to this space. Too often in NFTs, teams have failed to properly understand the vital aspect of all of this; they’ve miscommunicated, or worse, provided false information, and massively failed to understand how their community could actually be of help.
I don’t have any real answers yet on this idea overall other than the fact that I believe this is one of the strongest areas of possibility for NFTs as they grow into their next stage. Already, there’s been a growth in “collective information” NFTs, whether this be purely alpha groups, where holders share information around the NFT market, or properties like Crypto Packaged Goods, wherein the idea is to create a community based around building companies within the space.
It’s all going to be fascinating to continue down this pathway as long as we don’t blow the whole thing up along the way.
All of which brings me to —
THE ISSUES aka It’s Not All Sunshine and Lollipops
There are a LOT of things to be concerned about with the NFT world and I’ll use the next section to go into a few of them. This will definitely not be all encompassing, and I’ve already touched on some things I find problematic, but these specific issues are ones that I think have to be addressed before we’re able to move forward.
The “Yes, Sometimes It *Is* a Scam” of it All
There is no easy way around it: A significant portion of NFT projects that are currently minting on a daily basis are a straight-up scam.
Anyone who has participated in the space can tell you this and will have learned their own personal lessons and protective measures. The number of ways that people are attempting to get people to both a) mint projects that are either nefarious in origin or created as throw away projects designed to draw trading volume without any support whatsoever or b) straight up steal assets or currency from users’ wallets continues to go up.
With websites like Icy Tools or Nansen, it’s easy for people to get a sense of projects that are currently minting and what sort of momentum those projects have in terms of speed of mint + conversational chatter on Discord or Twitter. At any given time, there are still 5 to 10 projects that are minting new NFTs within the last thirty minutes, a number which has gone down significantly over the bear market. Of these, likely less than two, more often close to zero, is a legitimate project.
Minting a new project has a number of benefits over buying one on the secondary market. It’s at mint that you can see the highest upside if you happen to catch it before other people do. You might also mint a rare item that could be worth a lot more money. Minting an NFT is like a gacha game — you never know exactly what you’re going to get. It’s why people are drawn to early mints, something that might be flying under the radar, or something that you might have personally missed but the market is excited about. There is a lot of upside to being early.
Unfortunately, the bad actors in the space understand this mechanic very well and seed these projects in ways to make people feel significant amounts of fomo and drive towards minting out scam projects completely in hopes of turning a profit.
As a semi-regular participant in the daily mint cycle, I’ve learned to look for telltale signs of red flags across new projects and have a series of questions I ask myself before even considering minting. Does it have a Twitter handle in use? Does that Twitter handle have a lot of followers but isn’t following anyone (likely paid followers)? What does the OpenSea description say and how are they communicating about the project? What does the minting website look like, is it professional or from a template? Is anyone in known & active Discords aware of it already? Does the project have a discord of its own?
This is a skillset that’s grown by traders over time, and minting early is truly more of a hardcore trader behavior, and not something that the average new buyer or collector would necessarily need to develop in order to participate in a project. However, the sheer number of those new mints with nefarious intentions will continue to scare away the mainstream and enough of these stories have percolated into the general audience that it’s greatly harmed the potential for legit projects going forward.
Then, there are the phishers, those bad actors that spam DMs across Discord or post links to fake collections on Twitter in the hopes of catching someone off guard enough to either mint something from a site that either gives the criminals access to the users’ wallet or trick them into a trade for one of their valuable NFTs. This aspect of the space is so bad that many Discord users turn off their direct message completely as a significant percentage of those messages come in looking to take their assets or get them to mint something that isn’t real. Everyone in the space knows someone who’s been taken in through one of these scams.
All of this is terrible when it comes to the idea of on-boarding more people into NFTs and fulfilling the promises of what I discussed above. It also fulfills the general public’s idea of crypto as a ‘scam’ overall and amplifies these stories when they hit the mainstream.
On top of all this, there are a number of seemingly legit projects that attempt to launch with good intentions but had no business launching with either the business model or at the staff that they did. These projects may not be straight-up scams with the intention of taking the mint funds and running away but in creating a massive fund of cash without the proper skillset or team to manage it properly, these will often crash and burn, creative an endless news cycle which the mainstream news will pick-up on because nothing sells clicks better than a car crash.
A famous story in this vein is the project Pixelmon, an open-world Pokemon type NFT game where the users would own their own version of pocket monsters. The NFT launched in February of 2021 and raised 70m dollars at mint from the general public, creating a significant frenzy at the time with a promise of a fully realized video game with beautiful art that was previewed by the team. When the NFTs actually revealed (often NFTs have a week-long pre-reveal period to build hype and excitement), they were incredibly lackluster and looked nothing like what was promised. And, though the founders took responsibility for what went wrong, it was clear that the project had not come even close to doing the proper planning for what would happen after mint.
The values for Pixelmon NFTs crashed directly following the reveal and many owners who’d bought for the mint price of 3ETH (an already insane mint price) saw their NFT drop to a low of .15, a massive loss of value. The team was taken to task across social media as thousands of users called them out as scammers for not delivering on something even close to what was promised. It’s unclear from the team how much of this was on purpose or by accident, but either way the result was the same: a number of investors were burnt significantly and, as a whole, lost a lot of real world money.
What right did Pixelmon mint have to get that evaluation in the first place? I’ll get into that in the next section (hint: it didn’t but the market wanted it) but the good news is that those who have stuck around in the space are getting better at sniffing out these projects and demanding more from them before throwing money at them. And, to be fair to Pixelmon, they have been working, under new management, to deliver on their original promises.
However, in order for the space to truly grow, I think there’s going to have to be some sort of movement towards a more controlled and, at bare minimum, better communicated market for NFT launches. I’m not a huge fan of regulations but at some point there needs to be gatekeepers that will allow for a trusted system of projects, to at least weed out the truly nefarious types so that it doesn’t have to be a right of passage to be scammed by someone.
There will be many people who disagree with me on this and I welcome that. I don’t think it has to be the one solution and I greatly appreciate the argument around decentralization and why it matters. But there has to be a better solution than the current system.
Education goes a very long way, and there are really great collections like Zen Academy & Origins which focus on giving people the tools & understanding to be able to handle this going forward and share some of the lessons learned with new users. The marketplaces themselves are taking some of this on, trying to launch pre-approved projects which are trustworthy and from known teams.
However, even these often dip significantly in value and can be terrible investments based entirely on the market and what it sees as value in each project going forward. This directly leads into my next major issue with the space as it currently exists.
The Gambling / Dopamine Culture of Trading & Flipping NFTs
I mentioned this briefly earlier but another harsh truth about the way the NFT world works right now is the real world money value of projects are determined solely by what the buyers and sellers of NFTs will pay for them. This seems like common sense and, of course, it’s how all markets work. But the thing about the NFT market as we’ve known it, is that valuations are propped up and then eliminated due to the nature of always-on trading, and specifically “flipping” NFTs within short periods of time, often mere minutes from their purchase.
I want to make something abundantly clear if I have not already: I am not, nor have ever been, an expert in financial markets. I’m an English major for god sakes. In fact, it’s been made clear in my time in this space that I am a pretty terrible trader and often rely on others to help me figure out what exactly is going to happen with a given project’s value and whether or not it’s time to sell. Being a member of any number of NFT alpha groups is great for this sort of education. I *have* gotten better at understanding these markets over time, and look back at my time in this space as a business school of sorts. I have also actively participated in this sort of trading for some time now so I am not removing myself from blame.
I also want to make it clear that I understand that markets exist where this sort of behavior happens on a regular basis (I’ve seen Billions after all) and am not coming at this with naivety or a lack of understanding about how things work. In fact, many of the people I’ve met in my time in NFTs come from the financial world themselves and have brought with them this aspect from their day jobs.
But one of my biggest issues with the space as currently conceived and organized is that this flipping behavior has become THE dominant reason to stay in the space and very much one of the only ways, if not the only way, to come out as positive as an investor over time. It’s also come to dominate the narrative around projects and instead of looking at them as potential businesses or creative endeavors, they become targets to get in and get out of quickly and to use as a place to acquire ETH over time.
The end game of this ultimately is that a relatively small number of expert traders, armed with knowledge and tools that others might not have (such as the ability to bot popular mints) tend to take the value out of these projects early and leave other people “holding the bag”.
So what? you might ask, this is the way of markets. And yes, that’s true.
However, unless we start figuring out how to deliver on the promises of value outside of the flipping aspects of NFTs, there is little to no use in them having real world value. Or, more specifically, they will soon *not* have real world value and the overall ecosystem will come crashing down. Many people will argue that this has already happened and we’re on our way to the vast majority of projects being with nothing.
Additionally, those who are left at the tail end of this cycle, those who recently got into NFTs because they found the tech interesting or heard about a community or an artist that they liked, are often the ones who feel burned by those who understand the game better. They have two choices at this point: either become like the others who spend their time flipping and maximizing gains or assume that those who told them that it was a scam were right and leave the space forever. Either way, it isn’t great long term.
Almost as important, it’s worth examining what we’re getting out of this flipping culture and examining the idea of what it means to be part of it. This is a much larger topic that needs to be explored more significantly than I can here but a large aspect of what drives NFT culture right now is the dopamine rush of hitting on a project and being able to sell it for more than you bought it for. I can say that because I’ve felt it, on both sides of the equation, and it’s unlike many other things you can experience in daily life.
This, ultimately, isn’t about NFTs or about what’s possible with them but really about gambling and it underlies nearly every aspect of the NFT world right now. It’s a gambling mentality that caused thousands of people to mint Pixelmon at 3ETH and send their money towards a project that wasn’t ready. In their head, they might have been telling themselves: “This project looks good, I think it’s a good use of my money. I believe in the idea of what the team is promising.” But in their hearts they wanted that number to go up. They bought into the hype around the project, the collective excitement of minting something expensive that would become more expensive over time, the euphoric dopamine rush.
Of course, this is why people invest in any sort of business. Outside of non-profits or charity, no one is investing out of “good intentions” or giving away their money for fun. But in the NFT world it’s become less about the idea of investing in a project that you think has a good future, amazing technology and sound fundamentals and more about investing in a project for the possibility of flipping it for more than you put in. The honest truth now is that unless a project has a number of whale investors, meaning people who buy and hold a large number of the project’s NFTs, it’s basically impossible to keep the floor price stable. And as soon as a floor price starts to come down, it’s often a race to the exit.
There are definitely people in the space who are trying to approach projects in a more traditional business sense and find those which will stand the test of time, and invest in them wisely. This has also driven a number of projects to seek venture capital funding ahead of their mint which allows them to show holders that they are a real team, with real goals that are seeking to be more than a quick flash in the pan. Both of these are good for the general health of NFTs. And, about once or twice a quarter, there are independent projects that are very much a good long term investment. Something the entire market can get behind and understand that, yes, this team and this thing could be something that stands the test of time.
But even those are often susceptible to the issues laid out above.
The Environmental Impact, the Value Prop Conversation & Other Stuff
There are any number of other issues with NFTs and I’m sure I’m forgetting a ton of them but there are a few other quick hitters to list off. Again, I’d like this to be a conversation with whomever would like to chat and I’m more than happy to talk in detail about NFTs or whatever after the fact.
The Environmental Impact:
This is a very important issue raised around cryptocurrencies of any type and while I think that the issue can be exaggerated on either side, there needs to be significant movement made towards improving how we both a) address these issues going forward and b) how they’re talked about within the space.
First, the good news. Just a few weeks ago, the Ethereum network, where the vast majority of NFT transactions happen, switched from a Proof of Work chain to a Proof of Stake chain. As mentioned previously, I am no tech genius but essentially what this means is that instead of thousands of computers churning numbers and burning energy at any given time to show that transactions have gone through, certain users are staking their own ETH to show the same. There are many, many better descriptions of this online and I suggest you check them out but the end result of this is a blockchain that uses 99.5% less energy than before.
There are still other blockchains, most notably Bitcoin, that continue to use Proof of Work but overall, this is a massive improvement to the impact of cryptocurrency on the environment. However, it can’t be the end of the conversation when it comes to talking about this. This is one of the deepest, strongest mainstream criticisms around NFTs and it needs to be explained and expressed by people in the space who can help bring about an understanding to the technical aspects of what has happened and what will continue to happen.
This gets me to the second biggest communication challenge which is:
The Value Prop Conversation
A huge part of the criticism around NFTs is the idea that a digital picture, previously right-click-save-able, can have any value at all. The idea goes that if I can easily grab a picture of your Bored Ape and so can anyone else, then clearly this can’t be a valuable asset, especially not one that should be worth tens or even hundreds of thousands of dollars.
Nearly anyone who has bought a digital good or who has purchased a lookalike / print of an expensive piece of art, can see the beginnings of the fallacy with this argument. Still, it’s important that when we discuss this with people we do so in an understanding and educational manner. The most important aspect to get across to non-crypto people is that the blockchain has given us the ability to prove ownership over a specific digital asset much in the way that a certificate from say, Christies, proves that one painting was created by Basquiat while another identical one was created by a forger in a basement. This gives the owner of the proven asset ownership over something specific and tangible and of possible value.
There is, of course, the question of what exactly is art and how you should value it. I cannot pretend to answer this but the simplest way to express it is that the value of art is what people will pay for it. Are some NFTs overvalued? Most definitely. But I would also argue that some NFTs, based on provenance and history, are vastly *undervalued*. But, alas, the market doesn’t agree with me on those specific NFTs so they stay cheaper than I think they should be.
This isn’t just an issue with NFTs per se but because they are made of things that we’ve been trading over emails and social media for free for the last 20+ years and now suddenly are worth a lot of money, people have taken note. Therefore, like the environmental issue above, I think in part the solution to this is how we talk about it with one another.
A Few Other Things
This is a quick list of other things in NFTs that I think are major issues that I don’t have the answers (or the brain space) for right now. These are exceptionally sticky and we’ll need to get into them in order to improve the space overall.
- Early adopters of these technologies were able to accumulate a lot of the currencies needed to purchase these assets and often came from a place of extreme privilege in order to do so. The divides we see in the real world are directly reflected in the world of crypto and NFTs and this will be an ongoing problem.
- The general “crypto-bro” culture has permeated the world of NFTs as well and it’s exceptionally off-putting to a majority of mainstream users, especially women. The way men talk within the walls of Discord servers and on Twitter has to change in order to allow more people in and this isn’t going to happen on its own.
- Many “Virtual Lands” are now essentially worthless and people made a lot of money selling other people “plots” of space in empty virtual worlds. Will some of these come to fruition? Maybe. But the vast majority of them will not. The idea of how and where the “metaverse” comes into being will be an ongoing question but these may feel even more scammy in the future.
THE WHAT NOW aka Where We and Me Go From Here
WOW. Ok, this has been a lot. As I’ve written this over a couple weeks, it’s grown to a significant size and I expect most people will have given this their best but might be moving on at this point. I promise to keep this next section brief. This is, essentially, the conclusion of what I wanted to say.
There are a number of pivots and directional shifts coming down the road for this space and, truly, for myself as well. As I’ve mentioned, I wanted to jot down my thoughts on where we were and, in turn, I was after spending over a year head down in NFT land.
Learning as a Lifestyle
Learning new things is one of the biggest reasons I love to pursue work in areas that are pushing the boundaries in new technologies or new cultural movements. Not only are you doing work that’s helping you learn and be more interesting yourself, but you’re doing this along with a ton of other people who are learning and pushing this as well.
I just got off the phone the other day with Fabian Steltzer, a brilliant creative mind, who’s doing remarkable stuff with the new creative tools of artificial intelligence like Dall-E 2 and Stable Diffusion that are suddenly available to the masses. His new project SALT is a fully AI generated visual story that he’s looking to expand out even further and push into helping others learn how to use these tools to tell their own stories.
That is exciting as shit to me! Will I do stuff in that space myself? Maybe! Am I really thrilled to learn about something that will likely fundamentally change the way we create and tell stories and be on the bleeding edge of it? You’d better believe it.
Recently there’s been some movement around the idea of a “soulbound” NFT token. This is an NFT that is connected to either one specific wallet or to one other NFT and cannot be transferred or sold. Why would you want an NFT that could never be transferred or sold? Well, there are probably hundreds of different reasons that we’ll figure out ultimately (identity, account ownership, etc) but it’s literally just being figured out right now. That’s exciting.
This is what it means to have “learning as a lifestyle”. And I assume there is a near endless amount of stuff I need to learn just in the world of NFTs going forward.
Transitions + New Opportunities
Transitions are never easy. They often feel like setbacks at first and then, only with the addition of hindsight, you can see them for what they were. We’re in a major transition in the NFT space right now and it’s rough. You can see it in the number of projects that are launched and don’t mint out. You can see it in the numbers of people who are not actively engaging in the space. Hell, you can even see it in the celebrities that have removed the NFTs from their Twitter profiles.
But transitions drive growth and change.
I remember watching the beginning of the web 2.0 movement, seeing small experimental stuff pop and then take off and being so incredibly excited by what was happening. Blogs, user generated content, upvoting, all these new tools that were bringing content creation and curation to the masses. And then, most of them failed. Some incredibly so. But not all of them! Some of them literally changed the way we live our lives for better or for worse. And now these tools dominate the mainstream and shape the culture.
These times where everything seems like it’s dying are a time of regrowth into something new and more sustainable. There will be so many new things happening over the next five to ten years in NFT space. I personally hope a lot of the issues I have with it can be addressed and perhaps even fixed. And while there’s likely to be a big influx of corporate money pouring in to take advantage of this, there will still be the opportunity to start something fresh and new at a ground level due to the unique economics now made possible by web3.
For me, this means looking at my own personal career and what I want to do going forward. I believe strongly enough in the potential here of what’s happening that I could see myself doing more work in this space and attempting to try to overcome some of the problems I spoke about above. I also am looking into the future of the AI content space as well as many other emerging sectors. Will the next part of my IRL career be in NFTs? I don’t know. But I’m open to the idea of something that can push me forward as a person.
When it comes to your own personal career and / or interest choices, look to where transitions are happening. Opportunities abound.
Change it up.
The Metaverse (Yes, I said it)
So ultimately where do I see all this stuff going? Well, to repeat myself from above, the future is weird and ultimately no one really knows. But it *seems* like something pretty big is coming our way and that thing could *potentially* have NFTs as a large part of it.
That thing is “the metaverse”. Yes, I said it.
The Metaverse, as a word, has been thrown around a lot these last few years and a lot of people have written about it, no one better than Matthew Ball who wrote a great book you should read. And while you may have seen Mark Zuckerberg prouncing around in Meta’s Metaverse presentation and perhaps have seen a number of Black Mirrors episodes about it, the interesting version of the Metaverse to me is a little bit further out and will directly center around a significant change in a technology we use day-to-day.
The Metaverse that I, and to be fair a lot of other people, see coming will correspond with some version of an easily wearable, lightweight augmented reality (AR) device. This is generally assumed to be coming in the form of a pair of eyeglasses that will layer images onto what you see in the real world. Meta and Apple and a number of other companies are deep at work on this technology right now and while it’s not around the corner, it’s not that far off either. When the first iPhone came out in 2008, it felt like a crazy revolution but the tech building to that had been happening for a while. Here we are now in 2022 and it’s every bit the Star Trek communicator that was promised. AR glasses are going to be like that too.
Once everyone has a pair of these glasses, the idea of how we see and use NFTs will drastically change and become immediately more mainstream. NFTs will no longer just be pictures we hold on OpenSea and show as our Twitter profile pictures but will become virtual clothing (you’ll still have to wear something of course), art on our walls, and even our virtual identities to others if we so choose. Having ownership over these things. especially rare or valuable things, will probably mean something then. In addition, making and selling these things could be a significant business for hundreds of thousands, if not millions, of people around the world. It’s gonna be weird but, again, that’s what we’re here for.
What I’ve just described could still be decades off but the seeds for it are being planted now amongst the world of NFTs. They’re also being planted in the world of video games and I’m currently gestating a start-up with two other very smart people where I put my television programming and video game knowledge to good use creating serialized game and media experiences for existing “metaverses” like Fortnite or Roblox. These mini-metaverses are starting to teach people how we’ll exist in the much larger one that’s to come.
Overall, we’ve entered into an exciting period of technological change. It’s something that feels unique and different, and while there are echoes of previous eras and lessons to be remembered, we are also charting a new and often tumultuous path forward. The road has been bumpy as shit but at least it’s a road and it seems to be going somewhere.
And I, for one, am happy to be on it.
Thanks for reading.
Gavin aka FonkyDonk
Disclosures
As I’ve mentioned, I own a fair amount of NFTs.
In addition to Mice and Sheets and many others, I own a Goblintown.wtf NFT, a Decendants NFT, a Nimbud, and an Origins NFT pass (all mentioned in the piece above). If I’ve forgotten any, I’ll add them to this section over time.
Shout Outs
There are so many amazing people I’ve met along this journey and I wanted to shout out a few of them, some of whom got mentioned in the piece above but a lot of whom didn’t. This will leave out a TON so if you didn’t get mentioned I’m very sorry.
In no particular order:
Thank you to Mouse Dev and Kilo for the Anonymice project and community. Thanks to 0xInurashi for being there early and helping make Mice what it is. Thanks to Oliver Renner & Smokes for running Mice very well. Special shoutouts to some of the oldest and best of the mice community: Skelly, Slign, RoadSailing, DownBadTwix, Pompeii, Ericuuuh, KJ, Dubs, Red, Supachimp, Fishy, Scythe, Sesco, Mys7ix, Doyler, Stevie, 8zal, Maxi, JayLow, WutWut, Mandeezy, Robbo, Chip, Manpan, Biko, Artmin, Grantland, Kotaa, ZeroLearn, PaulyPaul, Emad, Dwilliams, Lola, SupaChimp, KingRobbo, n0ah, Anova, DOZE, DannyShelby, Sadie, RugularBobby and probably 100 more that I’m not remembering right now. Paxi, I hope you come back.
Thank you to my Sheet Fighter co-founders, our devs BHSDrew and Dinu, our community manager CharlieS and our incredible group of superfans of the project.
Thank you to the following for being really great people in the space: Bryan Brinkman, Jonathan Mann, Kodiak, Scott Beale, Kevin Rose, Tropofarmer, Sean Bonner, Christine Lu, Poof, Kodiak, Jumpman, SneakyNinjaPants, Eli Stronberg, Andy Milonakis, Jamie Dubs, Cophi, Katherine Lynn, RaceCar, Kassem G, 0xBasset, Gary Vaynerchuk, Domaz, Cesar Kuriyama, 3antar, Chris Cantino, Ryan Carson, Snerko, Chris Wallace, Gremplin and everyone in that early Proof discord (I still can’t believe I didn’t mint it), Adam Ludwin, Zeneca, Reedy Vector and so many more that I haven’t exchanged Twitter mentions with but have guided my way through this weird and rocky world.
