Exclusive Access…To What? (NFTs and Gated Communities)
Learn where value begins with NFTs and one direction it could be going.
Yes, my Obit is in the header image again. It is Spooky Szn after all! As the NFT market continues to surge, it’s never been more important to understand how to look beyond the art and see how NFTs can coordinate diverse individuals around a compelling vision and drive them towards creating unique brands. Through the examples of Crypto Punks, the Bored Ape Yacht Club, and Obits, I aim to chart a path downward from NFT-art to what grows from the communities that form around it and why that matters. If that grabs you, then read on!
Crypto Punks: Crypto Art’s Roots
“I think being different, going against the grain in society is the greatest thing in the world.” — Elijah Wood
Crypto Art is a movement and Crypto Punks is the spark that lit the fire and still plays a key role in keeping it burning. Back in June 2017, two creative technologists and software developers, Matt Hall and John Watkinson launched an art project on the Ethereum blockchain. That generative art project was Crypto Punks, an iconoclastic, Cyberpunk-inspired, rebel-driven nod to crypto’s roots. While its’ 10,000 unique punks were minted for merely a gas fee per punk purchased. Yes, Ethereum gas fees have now hit the stratosphere but back then, they were generally affordable because Ethereum was in its earliest stages and the ICO days hadn’t hit us yet. All in all, the Punks were the first example of a Crypto Art project that people widely noticed, though it took nearly four years for their true potential to take shape.
Why, you might wonder?
To me, it comes down to a redefinition of luxury. Summer 2020 was DeFi summer, but 2020 as a whole also marked Bitcoin’s rocket to the stars as a macro hedge and the initial formation of the Crypto Art space. It wasn’t until this year, however, that this fledgling creative movement truly showed its’ staying power, thanks to Beeple providing proof-of-legitimacy outside of crypto, and Crypto Punks surging back to fame, buoyed by Flamingo DAO making the first major move and showing the world they believed the Crypto Punks deserved to have financial value. From there, Crypto’s OG NFT collection only went further up, to where it is today, posting sales of almost $39.5 million in the last week alone.
Can the NFT pioneer go even further? Only time will tell, but for now, keep in mind that without the plunge that Flamingo DAO and others took, this year might’ve been different.
Bored Ape Yacht Club: From Art to Galvanizing Creative Potential
Ape follow ape. Ape help ape launch creative career?
Even as an outsider, I can’t help admiring the rise of Bored Ape Yacht Club(BAYC). What began as a collection of iconoclastic ape-based art and a quirky online bar where anyone could write messages on a virtual wall has evolved into a bonafide creative DAO. I say “creative” here, because I see so much potential for the Ape community in so many areas, that I don’t want to put them into one box, such as “streetwear+art.” If you think about their origin story as well as the sheer amount of value that now exists within the community, both in terms of financial and human capital, then you’ll begin to get where I’m coming from. While the media attempted to place BAYC into the box of an “NFT club,” where the avatars are luxury goods that people aspire to own, it’s the soul of the BAYC, together with the soul of Crypto Punks and the success of artists like Beeple that turned Crypto Art into the avalanche of progress that it is today.
From beginnings as an attractive space for crypto market participants “living on the edge,” the BAYC has become a cultural tour-de-force, inspiring the creation of a horde of communities that have come after it. Just a few minutes on OpenSea’s explore page will show you just how many NFT clubs, clans, and gangs exist today and for the most part, it’s because of the BAYC’s example. None of them, however, have sold some of their NFTs for $24.9 million at Sotheby’s, accrued over $27 million in sales in one week alone, or attracted as many well-known personalities to their cause as BAYC has. In my mind, only Crypto Punks sits on a higher level.
Above all of the numbers, however, lies something more important. Both the BAYC and Crypto Punks have served as early proofs of concept for what NFT-communities can be and should become. The former refers to what’s possible now, given the technologies, user bases, and overall adoption we have. The latter points to the road ahead, which like the crypto space as a whole, is absolutely full of golden opportunity. It’s up to the users themselves, the colorful, wild, free PfPs dominating Twitter to take it. That means looking beyond access, merch, tokens, and even art. Think of every possible thing a diverse, globally distributed group of people with a common vision could do. In other words, think about a company, run by all of its stakeholders, equally, and then think of all of the areas of business that company could be in. You’ll find yourself in an endless loop and that comes with the territory. NFT-communities become DAOs if done right. In fact, they become DAOs as long as the community coordinates to turn its mission, vision and values into actual products and agrees to some sort of organizational structures for making that happen.
Consider the below, which I stumbled upon today.
This quote encapsulates the power of DAOs. They’re transparent organizations with distributed leadership and their funds, voting power, and overall management backed up by self-executing software. The more time you spend in this space, the more you’ll see just how powerful this mix of features is. BAYC is the first major example of an NFT community that is already a DAO with all sorts of moves happening within it. For now, those moves are largely a mystery to me but placing BAYC under the umbrella of a sort of city-state of its’ own yields some clarity. Over time, I hope the launch of their token and the ventures that follow yield even more.
From DAO Power to NFT DAOs
The power of DAOs has now been split along two major lines, those which gate themselves with crypto and those which gate themselves with NFTs. Still, access is only the first tipping point for both “Crypto and NFT DAOs.” It’s what is offered once that access is granted, i.e., what lies inside the community in terms of its’ vision and its present/future products that truly matters more than anything. NFT-gated access is nothing if the community doesn’t come together to create something that transcends the art itself and offers real value to a segment of that world.
Just because we’re building a new, better world with all of these technologies doesn’t mean that all of the timeless principles of business have gone out of the window. On the contrary, they’re still there. I call the current Crypto space the Metaverse because, for me, it’s a catch-all term for everything from the blockchain, smart contracts, cryptocurrencies, tokens, NFTs, VR, AI, and everything else that’s converging at this beautiful, massive, societal tipping point we call home.
In terms of career choices, there’s no place I’d rather be. If you’re already here, reading this, then you’ve seen the earliest examples of NFT communities that have or at least could become even more powerful DAOs. If you’ve got a sense for what people want and how to build products, then you’ve got a place in making that happen in what I’ll term, “Crypto’s Silicon Valley.”
NFTs are one form of incentive that opens the door to present and future DAOs, which are the proving ground for the world’s most innovative businesses and that’s where I aim to stick around.
Next time, we’ll dig further into their potential through “Crypto DAOs,” then tie them together with NFT DAOs in a further post, before moving on to even more emergent ideas. Numerous examples of promise within the NFT space exist, but at the present time, we’re in the equivalent of the 2017 ICO boom. Many will fail but many will also succeed. It goes without saying that such a statement isn’t financial advice but my belief based on my thesis, which is grounded in my years of experience here. Take every opinion with a grain of salt and form your own toolset.
Speculation doesn’t rule. It’s just louder as an innovative area begins to form.
Until we meet again, remember that you can and should connect with me on Twitter anytime to share your thoughts on this and anything else I’ve written. Finally, if you’re interested in having my thoughts be delivered to you via email each weekend, sub to my free newsletter, where I break down how the Metaverse improves things for everyone! Stay safe out there and remember that getting involved in an NFT community is often as easy as finding their Discord and reaching out with how you’re interested in helping out!
Disclaimer: I do own an Obit. I do not aim to garner any investment for the project from my efforts and no one should make any investment decisions based on what I write. All of my content is purely educational. Do not treat this post as an inducement to buy any sort of NFT. In a day and age where you can never tell who isn’t just shilling their personal portfolios, this has to be said. Always do your own research before you put any financial resources on the line for anything.
I also consult with three NFT-focused firms/projects now and am always looking to hear about more. If you’re launching a startup with NFTs and are looking for a strategy/content consultant, email me at: blockdemiclab@protonmail.ch.
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