After a few weeks of hysteria, the ERC721 market has gone zombie. Perfect opportunity to change the rules!
Wow! Boom! Crash! : from the Tulip mania to the Subprimes crisis, speculation episodes have made the same sounds for centuries. The tale is repetitive: people believe they’ve found a magical way to make a lot money out of nothing — overnight. Wow! Then more people hasten, prices logically soar, and here comes the crowd, sending assets to the moon. Boom!!! Eventually someone realises that a tulip bulb can’t decently be worth a master house in Amsterdam, and it’s the crash.
Exactly the pattern followed by the crypto-collectibles during 2018 Q1 when the digital community discovered that a ‘baseball-cards’ market was possible online and went frantic.
Thanks to ERC721 (aka NFT, or non-fungible tokens) images were suddenly no more free stuff on Google but could actually be possessed and sold on Ethereum network, their scarcity and ownership being guaranteed within smart contracts on the blockchain.
We’ll all know the finale of this Casa de pixel…
No spoiler, we’ll all know the finale of this Casa de pixel: millions of dollars were made by scammers, and poor morons were left with ill-cropped Google-images of singers and movie stars in their wallets. Subsequently the crypto-collectibles market went zombie.
End of the story?
Not sure. There’s a future for crypto-collectibles. And a huge one if what we know about human nature is of any help. But for the crypto-collectibles market to thrive again, two thing have to change radically.
First, our community must be now totally copyright compliant. No more illegal crypto assets issued and traded: it’s not because we’re in uncharted territories that we have to make them as unsafe as the Wild West.
Can this change be enforced? Frankly, I don’t know: Ponzi’s call sometimes seems as powerful as Cthulhu’s…
Second, our community should explore the necessity to change completely its capitalist paradigm. Not by giving more to the user (like some smart contracts intend to): if we are to make a copernican move, we, issuers, should consider to give our NFT for free.
Yes, for free.
So far, ERC721 issuers have regarded buyers as classical investors — only they who buy take the risk, and try to make money with the asset if they can get rid of it.
Let’s modify the proof of value-creation!
Let’s modify the proof of value-creation. As a decent issuer, you are confident that your non-fungible tokens’ value will increase with time, right? So give them for free and design smart contracts that ensure you that for all secondary sales you’ll have your (small) cut. That way, you won’t put the burden (the financial risk) on the primary buyer.
That’s the choice we’ve made at hiprecious.com: crafting high end crypto-collectibles and giving them to carefully chosen users so they can (i) keep them (ii) transfer them for free (iii) resell them whenever they see fit. Meanwhile, they’ll evangelize, build up trust and value.
The market stays flat? No loss, no worry. It blooms again as we do believe it will? Great for you, buyers. Great for us, issuers. Win-Win.
Undoubtedly, there’ll be issues. At this point, we’re very confident that our friends at opensea.io and rarebits.io will extend their “gas-free for primary sales” policy. That would be a virtuous circle. Next: to whom are we going to distribute those free ERC721? Crypto activists? Why not. Charities? Great idea.
Copyright compliance and a leap of faith: that’s what we need if we really want to build a sustainable market of legal crypto-collectibles. Ten years ago, when the old fashioned banking system collapsed, the crypto community seized the opportunity to change the rules. Bitcoin took off.
Well, cryptos, it’s 2008 again.