If you were to travel back in time to the end of 1992 when Marc Andreessen was developing Mosaic — the world’s first graphic interface web browser which popularized the internet to a mass audience — and ask the then-University of Illinois undergrad how the web might blossom over the next three decades, there is no way he could have envisioned a future in which billions of people are accessing algorithmically intelligent web pages, a dizzying sprawl of social media applications, or simply ordering food and watching TV shows with the touch of button from their handheld smartphones — smartphones which recorded those same shows. In fact, Andreessen once famously remarked:
Any new technology tends to go through a 25-year adoption cycle.
Value created and distributed by the brands, creatives and influencers
If that’s the case, what will people be saying about LUKSO in 2030? Or 2050? LUKSO could be considered a “multiverse,” a blockchain network where the worlds of fashion, gaming, design and social media intersect. LUKSO allows developers and creatives to dictate the distribution of wealth and influence from lifestyle activities and direct value flow in whatever direction they want. Imagine Kim Kardashian issuing branded tokens to her millions of fans which could be traded for real Yeezys or digital Chanel bags or converted into digital currency in a future economy that isn’t ruled by central banks or nation-states. LUKSO is a tool to equalize power between people globally through creativity. It’s a network designed to foster the creation of systems to inspire both mass participation and unified stakeholder ownership in a way that is completely fluid and in real-time. LUKSO is meant to go beyond broadcasting and consuming — it’s where the true value of a digital lifestyle can support who you are.
Launched in late May with a rICO — Reversible Initial Coin Offering (more on that in a bit) — LUKSO is the brainchild of the husband-wife duo Fabian Vogelsteller and Marjorie Hernandez.
Right now the internet allows you to communicate in the form of video, text and audio, and now we have the internet of money and value and that allows for real participation, real ownership — real crowd ownership. What blockchain brings to the table is what’s currently missing with the internet, says Fabian Vogelsteller, adding, Artists, brands and influencers will soon dictate distribution of wealth and distribution of influence. The possibilities are endless because users can create value and it can now flow in whatever direction they want.
Beyond the vision — A solid tech team
Admittedly, it’s a heady concept, but Vogelsteller, in his technical tenor, can make such bold proclamations because of the unique perch he occupies as a thought leader (and innovator) in the blockchain universe. While working at the Ethereum Foundation, as one of its earlier employees, the German-born developer built the Mist Browser, the first web browser for the so-called “Web 3”, a browser operated only on the decentralized Ethereum network — basically the blockchain analogue to Andreessen’s Mosaic. It was downloaded over 15 million times between 2015–2017. He also developed the Ethereum Wallet, a tool that is heavily used by smart contract developers today. In 2015 he co-wrote ERC-20, the technical standard for so-called “tokens”, used by nearly all smart contracts on Ethereum that enable fundraising projects known as “Initial Coin Offerings” (or ICOs). In the two year-period between 2016 and 2018, these ICOs were used to raise over $40 billion in funding for thousands of blockchain projects.
What Ethereum founder Vitalik Buterin realized early on was that a Bitcoin ledger didn’t have to be relegated to a currency market. In fact, with a virtual machine built-in a blockchain could be turned into a virtual computer that sits in the cloud. In essence, it’s a global computer that can create unique, incorruptible systems — incorruptible because the blockchain rules have to be agreed upon by all users — for voting, fundraising, authentication (of physical and digital assets), and identity applications. Or whatever other applications tomorrow’s developer might dare to dream up.
“Whatever you create here can have a life of its own.”
This wasn’t the case, of course, during the initial “Web 1.0” phase of the internet. An exciting — if not entirely expansive — period, Web 1.0 was dominated by read-only static HTML pages that emerged in the early Nineties and lasted into the early Aughts. The secondary read-write Web 2.0 phase of the internet, which began in earnest around the 2004 Web 2.0 Summit, gave end-users a seemingly endless number of platforms for communicating in real time via mail, blogs, social media apps like Instagram and Twitter, and networked online communities, e-commerce, and gig economy platforms like YouTube, Etsy, Uber and Airbnb. These platforms allowed users to become content creators and influencers, however, the community members who built equity for these platforms still remain beholden to a centralized network designed to benefit the bottom lines of the real owners (and stakeholders), not the foot soldiers.
To be fair, centralized networks were necessary, if not altogether equitable, over the past 15 years. But that inequity started to become much more apparent after Bitcoin creator Satoshi Nakamoto unveiled the first blockchain technology and the first decentralized digital currency in 2008. In effect, the launch of Bitcoin, which currently has a market cap of $140 billion, became the opening salvo for the third wave of the internet. Bitcoin ushered in the dawning of the so-called Web 3 epoch, which began to initiate the transition from centralized platforms to decentralized ecosystems. These ecosystems have metastasized at alarming rates in the wake of Vitalik Buterin launching the Ethereum network in 2013 along with the thousands of smaller blockchains created after Bitcoin.
Vitalik figured out not only can I manage bitcoins but if I make the network Turing complete I can basically make this ledger into a computer. And what can you do with a computer? Whatever you want.
Says Tom Serres, co-founder of the Boston-based Warburg Serres Investments that builds and invests in ventures that are empowering the decentralized economy.
We believe that decentralized architecture for most things is inevitable. It might take 10 years, it might take 15 years, but it’s going to happen. We believe Web 3 will be the next wave. What’s attractive about LUKSO is that Fabian is a visionary futurist, a veteran in the space, and LUKSO’s view is very focused on digital lifestyle — gaming, entertainment, media — and we think that is unique relative to the other blockchains out there.
LUKSO — How it all started
Though Vogelsteller may have earned visionary status for his work on ERC-20 and, later, web3.js — an open-source JavaScript library which allows developers to connect to the Ethereum node and develop blockchain apps more easily; a library that now has over 120,000 downloads per week — the German developer admits it took a full year for him to comprehend how a blockchain really worked. In fact, he’d never even heard of the technology until he stumbled upon a 2013 article about a Canadian man who listed his home in the then-relatively unknown Bitcoin.
I thought, ‘Wow, that’s crazy. Somebody is trying to sell a house in a currency I’ve never even heard of.’, recalls Vogelsteller.
While studying in Weimar, he released Feindura. He earned an MFA in Media Design at the historic Bauhaus University. It was there during his studies that he met his future wife and partner Marjorie Hernández. From the beginning the German developer and the Caracas-born architect were collaborating on film and art projects. From film projects shown in film festivals in Berlin, to media art installations exhibited at the ZKM, the couple’s collaboration has always been across disciplines and mediums.
We’ve been working together pretty consistently for the past eleven years. During my time working as a consultant, I brought Fabian on as an expert voice in my projects. — Hernández
Marjorie worked for some of the more innovative and creative groups in Europe, before joining EY in 2015 as an innovation and strategy consultant, where she worked on Ethereum and with the IOTA Foundation, before founding LUKSO with Vogelsteller.
I would have never done LUKSO myself because I couldn’t connect to the creative economies demographic like Marjorie can and see the vision she has.
But the idea of making a blockchain for exactly the kind of people who are excluded from the current blockchain conversation was always interesting to me. I’m interested in redefining how society works and this is the best group to do it with, it’s the strongest one. I think we will rediscover that our society will soon be run not on money as we know it today but on a concept of reputation and value on many levels: what kind of groups you’re part of, what kind of things you produce, and that will be traded in the form of tokens. — Fabian Vogelsteller
LUKSO has the potential to create any type of ecosystem that a developer could imagine on top of a blockchain. Historically, creative economies have faced extreme hardships becoming economically viable, but if writers, artists, and designers were able to create stakeholdership — the way YouTube turned users into creators, but without a middleman dictating how content is ranked or censored — they could create value flows in any direction they wanted.
In this world it’s still a little undetermined as to exactly how you ultimately make money, but money looks different in this future world and some of Web 3 is about the future of money. Fortnite has made billions of dollars selling clothing and dance moves in its gaming system. I can connect with that because I’ve seen my son or daughter do it, and that’s a lot of money and a lot of scale. — Serres
Tapping into an ocean of further possible use cases & a step towards more equal and ethical communities
Portability and scalability are the two pillars of LUKSO’s appeal, and that is the network’s pitch to developers, entrepreneurs and brands. If a large or independent fashion house wanted to create incorruptible authentication — for, say, an Hermès Birkin bag or a Cartier Love bracelet — they could initiate that on a LUKSO blockchain that could, in theory, outlive the brands and carry on a life of its own via secondary markets. Those authentications could also apply to digital versions of the same assets. Outside of design and fashion, developers could employ LUKSO networks to execute charity fundraisers or send relief aid to dozens, or thousands, of recipients instantaneously. As Marc Andreessen recently opined on the Andreessen Horowitz blog:
In the U.S., we don’t even have the ability to get federal bailout money to the people and businesses that need it. Tens of millions of laid off workers and their families, and many millions of small businesses, are in serious trouble ‘right now’, and we have no direct method to transfer them money without potentially disastrous delays. A government that collects money from all its citizens and businesses each year has never built a system to distribute money to us when it’s needed most. Why do we not have these things? Medical equipment and financial conduits involve no rocket science whatsoever.
In fact, such a system will undoubtedly be possible, viable and actionable on the blockchain-based Web 3.
You can build systems where you can have mass participation and massive stakeholder ownership completely fluid and in real time.
LUKSO is a tool to equalize power between people globally. We have a lot of institutions and companies that are so powerful that there is no equal power anymore. A big brand has way more power than a small designer; a newspaper has more power than a bunch of independent journalists. Middlemen have been good so far but now we are able to build content and value distribution systems without anybody in charge so you could have a pure journalist-run community newspaper fully automated with pay distribution based on article consumption. That’s an especially interesting proposition in creative communities. —
These historically institutional gatekeepers — publishers, fashion brands, music labels, curators, galleries — have a bad track record in their deployment of gender parity, equity along racial and ethnic lines, and in empowering artists and creatives on the margins.
A big reason why we are creating LUKSO is to open the blockchain to all users regardless of gender or race, says Hernández: I receive hundreds of messages via LinkedIn from women who have heard about LUKSO, and want to be part of this project, working in blockchain. I was completely in awe that all of these women who work in tech want to work for us or want to know more about the vision.
How LUKSO addresses the current challenges in the blockchain space
Historically, there have been two central problems with blockchain. First, while there are thousands of applications in the market the use cases are extremely limited to finance. If you’re not someone who is interested in trading altcoins or wagering in prediction markets there haven’t been many avenues for the average end-user to explore. Second, blockchain is not exactly intuitive or user-friendly. Since there are no third party password logins for blockchains, if you lose your private key or your phone got destroyed you could lose all your assets. The interfaces are also extremely complex. What Vogelsteller plans to do with LUKSO is take a page out of his old playbook — namely his history with open-source building the first user interfaces for Web 3 — and deliver a set of “core tools and standards” to make blockchain easier than today’s centralized account systems and to encourage developers to create future decentralized communities, brands and digital worlds.
Everybody wants to build something cool, but they don’t always want to build everything from scratch. That’s why we need the standards and tools. — Vogelsteller.
In addition, LUKSO will be the first test case for Vogelsteller’s Reversible Initial Coin Offering, or “rICO” concept. When he co-created the ERC-20 standard in November 2015 it was a boom time for projects looking to create tokens on the Ethereum network.
ERC-20 created a wave of ICOs because everyone realized, ‘they could make their own tokens.’ This created a fundraising mania over a two-year period, but bad things happened. People invested in unrealistic valuations and there was no way to back out of these ICOs. Once you bought a token you had to hope they could be traded so you could sell them on the market. There were issues with scams as well. Most people wanted to raise money to build something, but some raised too much money, which completely derailed their interests. It led to a lot of bad players and blockchain became the wild west of decentralized fundraising. As the person who proposed the de facto standard that initiated this ICO wave, I wanted to find a way to improve ICOs, make them more fair for investors, have more repercussions on the project and more balanced power on both sides. — Vogelsteller
In a Reversible ICO buyers reserve tokens and then buy those reserved tokens over a period of time (e.g. 8 months) automatically. During this time buyers have the option to return still-reserved tokens at any time and receive their associated ETH back. When New York tried to issue a BitLicense every crypto exchange left because no blockchain developer wants unnecessary regulation in the space at this time.
They want freedom in the sandbox to innovate, and clarity over existing regulations and their application.
With the rICO concept, which is independent of but inherent to LUKSO, Vogelsteller wants to demonstrate that the industry can have better regulation via security-by-design with uncheatable, auto-regulated systems built within the chains.
I want to bring safety to investors by design rather than having a bunch of paperwork, which doesn’t bring real security, says Vogelsteller. Even if you have a prospectus you’ll never get your money or it will take you 10 years to get a portion of it. It’s not fitting with today’s real time economy and internet. On blockchain we can do it in real time and safe by design.
The most often repeated question for LUKSO thus far has been: why build a separate network? Why not just build this ecosystem on Ethereum, the second largest blockchain, and which Vogelsteller helped build? The answer is scalability and interests. Blockchains don’t scale endlessly and Bitcoin and Ethereum are at their maximum capacity. At the same time the demographic and interest around the Ethereum network lies currently with a trend called “decentralized finance” or DeFi in short, enabled through the standard Vogelsteller created in 2015. LUKSO’s focus is on a new digital lifestyle, something that is relevant for influencers, creators, artists, YouTubers and other social communities, as well as brands and the coming virtual social world. None of these things are big on Ethereum right now. Vogelsteller believes that in the future, there will be an internet for blockchains — different chains around different communities with different demographics.
If fashion or culture brands want to use blockchain why not let them start their own? It brings the magnetic effect and the value growth of such a decentralized ecosystem to their businesses. You also have better scalability because you’re not sharing it with any other industry or use cases, says Vogelsteller. In the end it’s a community. We know people are tribal. That doesn’t mean you run these blockchains completely isolated.
LUKSO is an infrastructure, a base layer that will be able to connect to other chains and let assets flow freely between them. What I’m interested in is how we can disrupt society and bring new modes of working and interactivity that was unthinkable before. Blockchain has already done that and we haven’t even gotten started: A few years back it was absolutely unthinkable to have a financial system without an intermediary or bank.
Now we’re thinking about new forms of economic communities, powered by the interests of modern internet culture. We are ready for this disruption and excited to see how it will turn out.
Visit our website: http://www.lukso.network/
Participate in the rICO: https://rico.lukso.network/
Join the conversation: https://t.me/LUKSO
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