In this conversation we go over the different types of NFTs out there and how investors can get involved.
Devin Finzer, Co-founder and CEO at OpenSea, which is the largest marketplace for Rare Items.
These Rare items on the OpenSea Marketplace are Non Fungible Tokens, or NFTs.
NFT’s are unique, provably scarce, liquid, and usable across multiple applications. There is a booming market for NFTs in things like: Virtual Real Estate, Domain Names, Virtual Art, Game Items, Tickets, Etc.
In this conversation we go over the different types of NFTs out there and how investors can get involved.
Devin literally wrote the NFT bible on all things NFTs, loads of value in this episode. Please enjoy this chat with Devin Finzer of OpenSea.
Check out https://anchor.fm/investinalts for all the listening options (Spotify, Apple, etc.)
0:00:00 Welcome and context
0:02:07 Who is Devin Finzer?
0:05:16 What attracted you to NFTs at the beginning?
0:08:05 How do NFTs work?
0:09:30 How are NFTs different from fungible tokens?
0:12:51 What are the most popular use cases for NFTs?
0:17:34 What are the use cases of digital real estate?
0:21:10 What are the headwinds for virtual real estate?
0:24:43 Are there any platform risks with decentralized digital worlds?
0:28:51 Could centralized gaming platforms introduce some features from the NFT world?
0:32:32 What are the most common myths about NFTs?
0:35:21 What sort of investors you see in this space?
0:38:26 What catalysts can help this space grow significantly?
0:41:50 What would be a good starting place for NFT investors?
0:45:17 What key differences you see in OpenSea from the typical consumer space?
0:49:29 What is OpenSea?
0:52:41 What is on the roadmap for OpenSea?
0:45:47 Where can people find out more about you?
Ben: [00:00:00] Welcome to the alt asset allocation podcast, exploring alternative investment opportunities available to the everyday investor. Here’s your host Ben Lakoff.
Hello and welcome to the Alt asset allocation podcast. Today’s interview is with Devin Finzer. Devin is a co-founder and CEO at OpenSea, which is the largest marketplace for rare items. These rare items on the OpenSea marketplace, are non fungible tokens or NFTs. NFTs are unique, provably, scarce, liquid, and usable across multiple applications. So what does this mean? This means that there are NFTs for things like virtual real estate, domain names, virtual art, game items, tickets, et cetera.
There are many different applications for these and this conversation. We go over the different types of NFTs that are out there and how investors can get involved. This market is exploding right now from a low base, and that imagined NFTs will continue to grow in popularity going forward. In episode one with Alex Masmej, we talked a bit about NFTs.
And in this episode, we dive deep into this world. Devin literally wrote the NFT Bible on all things NFTS. So there’s loads of value in this episode, before you listen, please don’t forget to like, or subscribe to the podcast or even better leave a review. This really helps more people find the podcast and keeps us going.
It really, really helps if you listened to this and have purchased NFT before, please give me a shout out. I’m curious how many of my listeners have actually dove down this rabbit hole and experimented with NFTs a bit, either way, enjoy this conversation with Devin of OpenSea.
Good morning, everybody. I’m here with Devin Finzer. Who’s the co-founder and CEO of OpenSea, which is an NFT marketplace. Welcome Devin.
Devin: [00:01:50] Thanks for having me Ben,
Ben: [00:01:51] Glad to have you on I’ve checked out open seat and you have a lot of really good content on NFTs in general, just recently in January, you published the NFT Bible, which is, the go-to guide for all things NFT. It looks like, but before we dive into that, I wanted to start a little bit about you and your background.
Devin: [00:02:11] Sure. Yeah. So, my background is in software engineering. I studied CS college and then I started my career at Pinterest, where I was an engineer on the growth team. So I learned a lot there about kind of growing consumer products, a really interesting company to be part of at that time.
And then I left Pinterest to start a small company, or startup in the personal finance space. That was pretty quickly acquired by a company called credit karma, which does, free credit scores for, us customers primarily, and, and work there as in engineering once again. And it was around that time, that.
Crypto started getting, you know, pretty like a lot of attention in the tech community. I followed Bitcoin kind of as much as like the average tech person, maybe a little bit more, but never really got super deep into it. but the 2017 wave was. Brought a lot of people and myself included, and, started sort of exploring all the different, lenses from which you can look at, the, this trend of, blockchain based, assets and, you know, blockchain based applications, the lens that I think, my co-founder Alex and I were always really excited about was sort of the, More of the, the broader technical lens.
So not just Bitcoin as like this purely financial use case, but you know, what are the sorts of applications that can be build that, you know, go outside of just tokens and speculation and. Sort of monetary, side of things. So, CryptoKitties was particularly interesting, because crypto kitties was the first game built on blockchain.
and so it was basically a game where the, instead of, you know, traditional game where some company has the items inside of a database and all of the logic is run on. Servers, this game moved, the items to the blockchain and even ran a lot of the logic of the game on a blockchain. And we thought since CryptoKitties launched, there’s been sort of an explosion of other experiments that are of the same ilk.
It CryptoKitties and open see is, a platform that is. Very deeply involved in that kind of emerging space of what is now called nonrefundable tokens.
Ben: [00:04:33] Yeah. Great intro and non fungible tokens have just exploded. They started with crypto kitties in 2017 and now there’s up to a hundred million over a hundred million dollars of value crossed in this space.
I’m sure. And that was a couple of months ago, I’m sure it’s gone up since then. A lot of growth here and it’s pretty unique. I think that you started. Diving into NFT space in 2017. Why NFTs? you just really saw crypto kitties as something new and exciting and wanted to build a business around that.
What kind of attracted you to NFTs the beginning?
Devin: [00:05:08] Yeah, I would say, yeah, a lot of it is kind of just following. You know, things that you’re curious about. I mean, for me, it was kind of this interesting, combination of factors. Like, I, I hadn’t really been involved in any gaming related stuff. I’ve been in some video games as a kid and all that, but like, I wasn’t deeply involved in that industry.
And so I didn’t know how interesting it had gotten actually I think the gaming spaces, even like certainly outside of blockchain is like, A lot of these games, they’re starting to be like really the next social networks. so that was kind of like an interesting trend that I had never really, understood before I looked at this particular game crypto kitties, which was sort of this like miniature economy around it.
Right. And highly speculative bubble economy. Right. but I just thought that was like kind of weird. And, you know, whenever you see something that we’re like, You know, people are buying, you know, something as crazy as buying digital cats for hundreds of thousands of dollars, it kind of peaks your interest.
and I think what was exciting about it was, you know, it was kind of an unbundling of all of the different pieces of, of a game economy. Right? So, Instead of, so it was a typical game economy for the most part. Like everything happens within this close ecosystem, that that is the game. and with CryptoKitties, you can have things exist.
Like, across multiple ecosystems. So for example, you could buy your crypto kitty and breed it within the crypto keys environment, but then of course you can go and sell it on open sea. people are even doing crazy things like, you know, making it possible to take loans out on your crypto kitties.
you know, you can have your crypto kitty and a variety, like, all that you use. Right? And so it’s kind of this opening up of, Of the game economy in a really interesting way. So I think that was kind of the thing that, inspired us to look deeper and see what were the interesting things that we might want to build in the space.
Ben: [00:07:06] Yeah. I know that games have grown in popularity and I played a few video games, but I left that. But like you were saying like this, in game ecosystem economy, like Fortnite players alone, spend over a billion dollars on. Skins, which are like clothing and things like that. And that’s just within one of these ecosystems. having something like NFTs that can, that can transfer across different ecosystems. In theory, the way that this would work, and this is a little bit into the weeds, but I’m just curious if you have a crypto kitty, you could. In theory, put that crypto kitty, like in decentral land, like in your house and have him.
Devin: [00:07:44] Yeah. And in fact, I think that’s possible, today you can kind of, I mean, you know, it’s a pretty primitive, integration that you can like display or crypto kitty inside of the central end, if you want, where this is sort of starting to be. Kind of, like, like that use case feels a little bit like a toy use case, but, one, one interesting thing that’s happening is these sort of art based assets.
So think about like an artist just wants to publish their digital art and turn it into an NFT. well you might say like, Why are you going to buy this piece of digital art? Like what, you know, with a real piece of art, you can kind of hang it up in your room. but with an NFT you can hang it up in your virtual house in decentral land.
Right? So it’s kind of creating, a lot of those pieces that make. Real physical assets valuable, but sort of replicating them in the digital world.
Ben: [00:08:37] Yeah, that makes sense. And actually, let’s pull back a second. just to make sure that my unders my listeners fully understand what is an NFT, how is this different than fungible tokens like Ethereum Bitcoin?
Because a lot of times these things are just grouped as. Crypto things, and these are very, very different. And, you know, based on what you’ve published, you have a very good understanding. Walk me through, like, I’m a very new person investor to the space I’m interested in, in, in FTS. What are they, how they’re different, why I should be interested?
Devin: [00:09:08] Sure. So, with a cryptocurrency token like Ethereum or Bitcoin, or any of the tokens that are built on top of Ethereum, which are called ERC 20 tokens, the idea is that you have a supply of these tokens and you can kind of trade them around. And so that’s what the concept of fungibility is sort of this concept where you can, Interchange a multiple of the same thing and they’re, they’re basically interchangeable.
so, well what’s interesting is, you know, most of the stuff, a lot of the stuff that we deal with in the real world, is not. Like that it’s not like a currency, right? If, I have a piece of artwork, for example, I can just swap it for another piece of artwork. It’s it’s unique. Right? And so, the NFT, which stands for non fungible token introduces this type of unique asset into, the blockchain world.
And the first of that was CryptoKitties where each crypto kitty had a unique identifier, almost like a serial code. and. You know, you can just swap one group for getting for another because you know, they’re very different. Right. now I think one, one note that I will say is that, I don’t think that, NFTs are like a completely different world than cryptocurrencies.
There are all of the same nature, right there, all these blockchain based digital assets, and blockchain based digital assets come with these very exciting properties. so yeah. The exciting properties include, the ability to set a certain number of supply associated with these assets. So that’s true about the theory and mystery about Bitcoin.
And that’s true about CryptoKitties. According to the smart contract, there’s only a certain number of deputies that will ever exist. it comes to blockchain based digital assets. Also come with the ability to trace, the history of an asset. That comes with Ethereum that comes with Bitcoin. That also comes with CryptoKitties.
So this is just another way. This is just another type of digital asset that’s being represented on the blockchain. and it happens to be one that’s, you know, very, very broad and, has a lot of use cases. So. Game items was sort of the first one. But if you think about, all of the other digital assets that you sort of own in your life already, you could think about domain names, right?
As a digital asset that you own, you can think about an event ticket. you could think even about like a Twitter handle or an Instagram handle as a non-refundable digital asset. so the design space for. these sorts of digital assets is quite wide and quite unexplored at the moment.
Ben: [00:11:41] Yeah. There’s tons of these, right? Anything that’s provably scarce, liquid usable across multiple applications. These are kind of the qualities that NFTs have that make them so desirable. We have things like virtual real estate, domain names, art games, tickets, game items. What are the most popular, most common, highest growth you’re seeing within those subgroups.
Devin: [00:12:04] Right. Well, I think, it’s definitely started with gaming. I would say the virtual worlds category is one of them are exciting ones right now. so with virtual worlds, the, the projects are kind of structured such that. You have a virtual land that you own inside of the virtual world now, so you can buy a parcel of land.
and then you can sort of build something on top of that. It says the projects, that allow for this are, decentral and crypto voxels Somnia space and, the sandbox. So these are all sort of virtual world projects. And I think one of the reasons that particularly interesting is, you know, the it’s.
It’s a nice analog to the real estate market where, you know, there’s sort of this speculative environment around, acquiring land. That’s close to certain areas in the world. it sort of the foundations for, it feels like kind of, it, it’s the first piece of one of these really interesting virtual worlds.
and so that’s kind of where we seeing the most, volume over the last couple of years, but I would also say that there are some interesting, use cases, or interesting trends happening in the digital art space. So what’s interesting about this is, it doesn’t require like a complex or well-thought-through game economy.
it’s really just an artist coming and saying, I’m gonna create something digital. I’m going to tokenize it and I’m going to sell it. And. You know, my people who like it can buy it and then they can resell it on a secondary market. And as a mentioned, they could show it off inside of one of these virtual worlds.
and that, that use case has started to be pretty interesting. a lot of artists are getting really excited about this. A lot of collectors are, but, we are seeing really, interesting growth and I think, you know, one of the reasons why, I think these. Two use cases are really interesting fits.
actually, maybe there’s a third one that we’ll talk about in a second, but is that, they don’t sort of require a really high frequency tray trades. they they’re typically bigger value assets. So a lot of this land sells more than thousands sometimes. You know, sometimes often the a hundred thousand mile range, if it’s something really valuable.
but, that means that, you know, if you kind of dig into how the blockchain works, it’s really slow, right now, and, and really expensive to move things around. And so. the, the sort of lower tier assets aren’t quite as good of a fit for the technology as is certified here assets. and then the last, the last category that I think is pretty exciting right now, if you’re familiar with sort of a traditional domain name, like google.com, these there’s vibrant markets for these already, decentralized domain names kind of come in a variety of flavors, but, the.
The basic one of the basic building blocks is just the ability to have your wallet address. Have a human readable name associated with it. So instead of sending, Ethereum or another token to a string of letters, you would, or non readable letters, you, and send it to Devin dot ether or something like that.
Right. Or Ben, and these are, this is sort of one of those building blocks for the blockchain based economy that. you know, is necessary for it to achieve more of a mainstream audience. So I think that’s a, that’s another area that we’re seeing a lot of excitement.
Ben: [00:15:33] Awesome. And yeah, I want to dive into each of those with land. I mean, I think this makes sense. Right? Right now we’re recording this. It’s the mid August. And it’s like 200 wei to make a transaction on the Ethereum blockchain. if you’re not buying something for $10,000, like the transaction cost is a significant portion of the price, like you said.
Yeah. These things selling for like a hundred K, this is a, this is wild people purchasing. Digital real estate virtual land. This is a bet that. These virtual worlds become something much bigger, obviously. as the end game there, like sort of a ready player, one sort of world where you own your land and you build your, your, your place there. And, you know, I even know a guy, the guy behind the central games, which owns and operates a casino in decentral land. it’s a virtual business in a virtual world. is this kind of the bull case for virtual real estate.
Devin: [00:16:35] Yeah, I would say, yeah, it kinda the ready player one yeah.
Vision or something, you know, kind of like that. I think, you know, we we’ve seen, how exciting and, interesting these virtual economies can be with projects like fortnight and, older projects, like second life, which, I don’t know how many folks have. Are familiar with that, but it was basically this, you know, this giant virtual world where you had it, it had its own currency.
People had shops where they were selling. It’s still, still around. sorry. but people have shops where they’re, they’re selling, fashion items or, you know, basically kind of limited by, the, the economics of like a, a pretty centrally controlled. System. Right. and, something like decentral and, or crypto voxels has the potential to be a much bigger and wider economy than just sort of what could be created by a specific platform.
so I think it comes with the advantages of sort of being able to bring in any other blockchain based digital asset. and it, you know, comes with this, you know, very native, Ability to buy and sell things inside of the world, and, you know, participate in, real, the real sort of economic underpinnings of the, of the world.
so, so yeah, I think, I, I do think that, you know, beautifully, we’re buying this land now, or sort of betting on these virtual worlds, expanding. but it’s really hard to say, like, what’s. what’s a good price or, pieces of virtual land because, you know, it’s kind of similar to Bitcoin, right?
back when, Bitcoin started, you know, it wasn’t clear that it would become as huge. As it was today. and I think similarly, you could make the argument that a lot of these virtual worlds have the potential to become quite massive and that, you know, maybe a hundred thousand dollars for a feature is the wine is actually a steal.
so, I think it’s, you know, it’s kind of, it’s really just the beginning of a lot of these things.
Ben: [00:18:40] Yeah, these are very, very interesting. This fits in perfectly with the alternative investments. It doesn’t get much more alternative than that. You’re investing in a digital, digital, real estate in a digital world, a virtual world that’s completely uncensorable and decentral land and Everett decentralized in every way. there’s, lot of. It’s highly speculative. These interviews are always plastered with disclaimers because this is not investment advice, highly speculative.
And I think that would probably be a good segue. I mean, what are, what are the bear cases? What are the headwinds for these sorts of things and, just perhaps virtual real estate, because it’s kind of the biggest right now.
All of these things are built on top of Ethereum. obviously if Ethereum doesn’t scale and sort out, these things promised with ETH 2, that’s a lot of headwinds, but what key, risks do you see with these sorts of things?
Devin: [00:19:35] Yeah. I mean, I think, sort of platform risk, as we’re already starting to see the Ethereum network is getting clogged.
and that’s resulting in a lot of the lower value items, just not being worth it to purchase. I guess one kind of interesting note on that is I, I don’t think, I think these sort of applications like decentral land and crypto gospels and, and other games, We’ll be able to abstract over the blockchain layer.
Right. So I think just because the virtual land in a particular game happens to be on a theory at the moment, doesn’t mean you couldn’t have a system that allows you to take your land and put it into a different chain, trade it there, and then, you know, or even do a full migration to another chain.
That’s not out of the question. is. But it is certainly like, you know, it’s, it’s a friction point and it’s so honestly, I would say platform risk associated with like a theory is probably the, the biggest one, at the moment. I mean, I think, you know, there’s potentially like, you know, an existential risk or around like, Well, I guess, I guess sort of the broader lens there is the question of whether or not, blockchains in general can sort of support what consumers want from these virtual worlds.
versus sort of more of the centralized approach where, you know, there is clearly demand for these, these virtual experiences. but they, you know, you could make the argument that, The, the centralized platforms like Fortnite are just better positioned to kind of expand their virtual worlds and sort of these grassroots, approach.
It’s just, you know, I do think like at the end of the day, these experiences do have to. Be compelling and fun and like real games sort of that people want to play. and there has to be a reason to want to spend time in some of these worlds. And I can see it being challenging for a lot of these companies too.
Build that beyond sort of the, early adopter consumer base. but overall, I mean, I would say that, I’m pretty bullish on, virtual worlds, like long-term and certainly non fungible tokens and digital assets on blockchains long-term I just, I think that, you know, what I foresee as likely is that.
You know, over the next year, there are going to be a lot of technical challenges associated with getting these things to work on top of scalable chains and just a lot of back and forth between, sort of the infrastructure layer and the, and the app layer. But I’m not as, I’m not particularly embarrassed on like, On, they’re not being demand for these sorts of things.
because I think we have seen a lot of excitement around them, last, couple of years,
Ben: [00:22:30] is there, is there platform risk in decentral land and crypto voxels that they actually build this? Like you said, this land that people want to spend time in. I mean, you’re basically hitching your horse to, to them, right?
That they can. Build this thriving games, similar to second life or fortnightthat people want to go to. And then, you know, that virtual real estate has more value that there’s quite a bit of platform risk there. Right?
Devin: [00:22:59] Right. Yeah. So you’re definitely taking a bet on, like the crypto voxels team continuing to build out.
Right. and, I mean, as an interesting example, like there were people whose at that really early on and crypto Oxville started crypto Brussels was a lot smaller team than central and it was actually just one guy and he just started. We just put up some land for sale and I would see and said, you know, I’m doing this project.
If anyone wants to buy it, it was like 0.1 0.2 eats. and you know, some people got excited about it and bought it. And now I think like almost two years later, the lowest. land or lowest prices on land are like one or two weeks now. Right. and so those people who kind of decided to back the project has really like benefited from, from getting in early and sort of.
No sharing the project type of thing. but certainly like, yeah, there’s, there’s this existential risk that, that curb DevOps will developer just decides that he doesn’t want to continue to developing it. That being said, I think we’ve seen a lot of really interesting things happened in those sorts of scenarios where, you know, this community of a couple thousand people, They’ll sort of rally the troops, like continue the project.
and, I think that’s pretty interesting. so, we’ve seen that with a couple of like really small games. It hasn’t really manifested itself in a big way, but, that is one thing I can, I can see happening is that, if the original developers kind of decide not to continue that the community makes it up again.
And also, I would say that it’s not just a bet on sort of the developer of the platform. It’s a bet on, all of the people who are going to like build content on that platform. Right.
Ben: [00:24:44] So they have a stake to have it continue on as well. Right?
Devin: [00:24:48] Exactly. So it’s like this quasi decentralized system, I think in defy.
Or decentralized finance right now because everything is on chain. We’re seeing these like real, like I think last night, or maybe it was two days ago, we saw, a protocol basically, like vote itself into fixing a bug us to save like these yields farming, follow that closely. But then I think it didn’t end up working, but, Like we we’ve seen these communities where like people will, because they have this ownership, stake, they’ll work to get things built and fixed.
which I think is pretty interesting, but it’s, it’s definitely a sort of a hybrid right now since, Yeah. The main developers of the project are in some, have some degree of control over its destiny.
Ben: [00:25:39] Yeah. And I think that’s what excites me a lot about this space in general is the idea, even with governance tokens, right?
It’s like, I’m, I own a bit of the protocol and I have a say in the way that the protocol decides its decision-making going forward. I’m going to fight for it. I have a financial stake in. Incentivizing need to keep this thing living on. The more people that buy real estate and build things and have a stake in this system, the better, but this leads me to thinking, you know, somebody like Epic games or whoever owns, second life is.
They already have this distribution, this massive group of people what’s to stop them from just saying in a purely centralized manner, which is fine, you know, for the gamer, it is what it is, but Hey, you can buy this land. We’re going to launch this secondary market where you can sell it. You can put up art, you know, taking these interesting little niche experiments from the NFT world and just implementing them in a centralized manner within their games. Is this something that they’ve done? If not, why? Because they could, right.
Devin: [00:26:50] Yeah. I mean, I would say that that’s pretty much a virtual world where, you know, you can buy and sell land and I believe, that you can buy and sell all sorts of things.
it was just, you know, it was constrained right by, sort of what. you know, you kind of, it wasn’t possible to bring in, art from some other application easily. And, it wasn’t possible to take alone. If you want to take a loan out on your land, there’s nothing like that. Like, I dunno how you, you, you wouldn’t be able to do that.
And, the supply of a currency was, you know, the centrally controlled, sort of central banks of the world. And also, I mean, at the time, like, Yeah, it was, it was a lot, I think second line sort of, was popular maybe in the early two thousands. I’m not entirely sure, but, it was a very different like, experience that we have with like, you can go directly into it in a browser, things like that.
So, so that also constrained the audience a little bit too. yeah, I mean, I think at the end of the day, you, for, well, a couple of things, right? Like the. Big centralized game economies. there are game developers. They’re not incentivized to give community their communities full ownership over this, right?
Because they already have work while working business models, just selling items. And they can, they can build secondary marketplaces. Sometimes they decided not to because it’s not in their interest. Right. They they’d rather just sell more supply. and so. They’re not really like from a, so-so sort of from a business model perspective and like, and also a tech perspective.
They’re not really set up for this like real community owned economy. and while they could transition to it, it doesn’t seem clear to me that company like crypto voxels is starting fresh and so they can kind of play around with these brand new business models. and you know, they’re not for example, like if, if ethics decided to make something like crypto voxels, it would just be like an infinite testimony, small portion of their revenue for a year.
but for crypto bosses, it’s, you know, it’s kind of, what’s driving the project forward. so certainly like, I think. There’s nothing stopping, bigger companies from sort of adopting the same things that are popular in sort of the NFT world. and there’s nothing really stopping them from going full blockchain.
but it’s kind of a classic innovator’s dilemma in that they don’t, you know, it’s not clear that the incentive to do so does this right now.
Ben: [00:29:19] Yeah. That makes sense. I mean, the NFT back loans had this conversation with Alex Masmej, it’s a fascinating space. I mean, like, like you said, in the very beginning, like how do you value these things and the fact that you’re giving a loan based on them, but, you know, you do it with a normal home with a home equity line.
So doing this with the virtual version is really, really interesting. I’m curious with. Non-refundable tokens. And you have the section in your NFT Bible about this, what are the myths around in FTS that you see most often?
Devin: [00:29:53] Well, I think, one. Sort of thing that could be categorized as a, as a myth, is this idea that, you know, that it’s a good idea to abstract away and hide the blockchain from your users entirely and sort of creating this like.
Completely centralized, selling. but they use or never really works with the blockchain. And I think, the reality is that if you, if you do that, like it’s a lot easier to just use a centralized database. And, you know, as, as we’ve talked about in this podcast, like we’ve had digital assets for a really long time.
There’s nothing stopping you from building a normal, centralized digital asset. And if you want, if you have a good idea for, a game or a digital asset, like you should go ahead and build that. but if you want sort of, blockchain components to it, then you have to at some point, sort of let your users experience that, that true ownership and the ability to sell their assets on secondary market basis and things like that.
otherwise like you kind of did a lot of your, you did a lot of work to use a really slow. System. And it was a slow database for kind of no, no benefit. and I, I think it’s, it’s a challenge because, you know, by going the blockchain path, you’re taking a pretty big risk. but what’s interesting is that.
You get a lot of things built for you. So for example, if you look at crypto voxels, again, it was a one, a one man team. and really the main thing he focused on was building a really great virtual world experience. He didn’t build a market case. He just kind of left that to open markets. he didn’t build a wallet, right.
You just left that’s metal mounts and he could really focus on this one piece of that application. and I think that’s, that’s kinda what what’s exciting about this space is you don’t have to build everything. So what I would say is like, If you, if you’re going to build everything, then, you know, you might as well not use, he’s watching.
Ben: [00:31:51] Okay. Yeah. And I’ll link to it in the show notes, I think that’s a, that’s an important one. I’m curious. What sort of, investors are most interested in these right now? These are people looking to flip and they’re just gambling or they’re, what kind of mix of. Investors do seek getting involved in the space.
Devin: [00:32:11] Yeah, I would say, it’s, sort of, I mean, it’s more of like the, the tech savvy crowd, that is sort of aware of what is exciting about these digital assets, as opposed to kind of what we saw with ICO’s or maybe even defy right now, where it was primarily people who are like, Really interested in that just from a flipping or investment perspective, I think, because the space is kind of, so brand new and early for level of effort and savviness to trade these assets, right.
You can’t just kind of like buy token and hope it goes up. you have to like make sure that you’re buying like a good piece of real estate and. Understand how the product works. And, so there’s less of like just the peer speculator crowd I think involved right now. And it’s also just a much smaller market, at the moment.
so, so there is the sort of investor speculator. There’s also like the builder, crowd. And, that’s really interesting in the, in the virtual lands, space. So as you mentioned, there’s the central games, which is building casinos on top of virtual or on top of decentral land. there’s people building like museums on top of crypto box loads.
So people are just buying. Lands, legitimately, they want to build something and, you know, we’ll host an event there. I think that’s really awesome. yeah. And, and then there’s of course, you know, people who are engaging in like the very specific games, because they want to, you know, play the game, for example.
So there’s a couple, sort of, there’s a good number of trading hard games where, you know, they’re basically, they have these blockchain based trading cards. You can trade them around and then you can also play. playing game with them. And in order to, show off or like having a rare card in your deck or something that maybe it’s just cosmetically valuable, but, has value inside of the gaming system.
You’d want to purchase that. And then I think the, probably the most interesting and sort of, mesmerizing a group is like the art collector crowd, who is really like. You know, I guess a combination of an investor and like a curator, and those folks, you know, I think they buy things because they think it looks cool.
They want to show it off or eventually be able to show it off. And they kind of think that, I go up in value in the future. so it’s kind of the, sort of the same mentality one might have when they buy, physical art, So, yeah, I would say it’s kind of like, my sense, you know, it’s hard to say, but is that it’s a bit of a hodgepodge of all these different pieces.
Ben: [00:34:42] I like it. It’s certainly a niche market right now. What catalysts or events need to happen, or the space would greatly benefit from having to get some more exposure, get more people interested in it. What kind of series of events would be just a perfect windfall for the industry NFT space?
Devin: [00:35:05] Yeah, it’s a good question.
I think, I mean, my perspective is I, I think, a. I think it’s going to be really hard for, NFTs specifically to Edmond on, on a theory, or at least like on a theory as, as it looks right now. so I think, sort of the recipe for these things breaking out is, the, sort of early adopter phase.
Is, there, I think there needs to be a much lower cost higher through plate chain that develops a significant network effect around it. So that has like a marketplace on it. and, a good set of games building on it. sort of what we saw with Ethereum, but almost all over again and learning from kind of some of the challenges there.
needs to have like an art platform on it too. It needs to have really usable wallets and, on ramps into, into crypto that, that worked really well and could, you know, create, Enough excitement and enough momentum to really like get a lot of developers and a lot of artists and a lot of creators on board.
I do think that a lot of, what’s holding the space back is really the costs associated with these things. and the, and then I think it’s cost, like the fact that. It’s so hard to get, cryptocurrency in the first place. It typically requires going to Coinbase. So, a lot of the Fiat onboard on boarding solutions still require pretty aggressive KYC.
so those two ingredients, I think really are, in my opinion, preventing people from engaging and like getting excited. And then, and then, you know, getting entrepreneurs to build new things. on top of these digital assets, so I mean, you know, one way that could play out is that a brand new blockchain sort of somehow develops a little bit of that critical mass and then it just goes from there, or I think in my opinion, less likely.
but it’s possible hearing him will, be able to, provide the right scaling solutions on top of it that allow this to happen on the theories. But firstly, I’m a little bit less optimistic about that sort of scenario.
Ben: [00:37:27] Okay, that makes sense. And I’ll, I’ll avoid going down that rabbit hole. Cause we could probably talk for hours on that. All of these, these fundamental building blocks are coming, right. It’s just taking, taking time. Still bullish on NFTs and the crypto space in general, where would you recommend investors? they’ve gotten over the, the idea of they want to invest in NFTs. Where would you recommend them to start?
Devin: [00:37:55] Yeah, I mean, I think, checking, sort of, our, our rankings page on open seas, kind of an interesting way to start. You can see what are the, top projects that are trading by volume, where we’re going to be adding more and more tools for kind of viewing priceless, teary over time and kind of.
Understanding the markets. and then, you know, looking at some of the top projects and reading in to what, like what’s exciting about them and, finding, You know, I think, I, I guess the first thing I would say is like trying out all the projects that you can, before you purchase anything, just going and playing around with playing around with decentralized and seeing whether it excites you or not.
and you know, I think you should view any sort of investment in this space is like a extremely high-risk, investment and you know, something and, you know, potentially in some of the assets, not even really. And much of an investment in the margins. So I’m going to need my loan to acquire, to do something interesting.
and can kind of double as an investment. so I think that’s a, that’s a good place to start. I think also just trying out sort of, some of the basics of, the, the wallet primitive. So, I highly recommend sort of exploring the theory of named service and unstoppable domains projects, which are both, these sort of decentralized domain name.
Assets, and you can kind of get a sense for like, you know, why is this interesting? Why is this important? I think Twitter is also a pretty interesting source of information in the space. I would say that like, and I think this is kind of been true for, a lot of things typically doesn’t work because things move so fast.
so like if you try to Google, like some of these new defy protocols. You’ll just get a bunch of like really surface level stuff that doesn’t help you out. Yeah. There’s a lot of
Ben: [00:39:47] Googling yams and figuring out what that is.
Devin: [00:39:49] Exactly. Yeah. yeah, so I think, you know, finding sort of the key projects on Twitter, to, to follow and like.
Yeah, keep a close tab on, perish, I guess, that I would recommend off hand are, there’s a guy named Andrew Stein, Wald, also policy in the red, who writes really interesting content on the space. there’s another one that comes to mind is. defy arts Intelligencer. I think he has a pretty cool newsletter.
I think all of the men projects, so, opens he super rare where mold maker’s place are good ones to follow and kind of stay up to date with.
Ben: [00:40:25] Awesome. Yeah. And I’ll definitely link all of those in the show notes. those are great. I want to dive into open sea itself and what you guys are working on.
You had your own personal finance company that was acquired by credit karma or credit sutures and credit suture credit credit karma. And then you worked in growth. At Pinterest. I’m curious the growth strategies for something like open sea, which is a big educational aspect, I would imagine versus these more traditional companies, what key differences do you see that strategies that you’re using that are, that are so different than the traditional consumer space?
Devin: [00:41:01] Yeah, I would say it’s pretty different from the consumer space. I don’t think anyone has really well. I think, yeah, I guess you could say some people have cracked it to some extent, but. I mean, I think, you know, for one, with, something like Pinterest or social network, or like more of a consumer, a regular consumer app, you know, you’re dealing with like a big market, and sort of figuring out how to tap into the desires of those people in that market.
I think it’s kind of the opposite here. You’re dealing with like a very small market, but like a pretty passionate and pretty like tech savvy user base. That’s willing to put up with a little, a little more than like a typical person who, because there are. Do Frank, they’re already putting up with a ton by using crypto in the first place.
and I think eventually that will change, but I think that is kind of the reality at the moment is that, you know, most of these folks are, you know, pretty deep into the crypto space already, and kind of have the power user type. So, yeah, I mean, I think. We, we haven’t, we’ve been pretty focused on kind of building features for those power users.
and, like as opposed to trying to make it like really easy for regular people to sign up and we’re going to be shifting over towards the ladder soon. But, I just think it hasn’t really made sense. Yeah. but at the same time we do. and then I think, I think the other thing that’s really challenging is just sort of.
The complexity of the space as a whole, like, you know, I think probably the biggest example is the fact that gas prices are 250 quid and that kind of affects every single death. And there’s not really this thing you can do about it, but there’s not really anything you consider like really solid, right.
And, and those sorts of things, it’s just really challenging, to deal with. And, So it’s, I would say it’s, it’s such a nascent space that, you know, I think the reality is you kind of have to build for the early adopter, at the moment. but, but as I said, I think that that can change relatively soon.
Ben: [00:43:16] Yeah. That makes sense. And can you share any stats on open seas? this is a marketplace for all NFTs. Do you have a stats page? I could, I could direct people to or anything you can share.
Devin: [00:43:27] Yeah. There’s the rankings page kind of, has that’s open seat at IO slash rankings that has, sort of all the volume across various, across the various entities, in terms of kind of stats for, for ONC as the whole, I believe we’ve now hit a hundred thousand East in a trading volume.
we have, over 700 different projects that are listed on our platform and available. there’s over 13 million. Unique NFTs, that we index and allow you to browse search actually over 15 million, and then we allow you to sort of discover and search. so yeah, it’s definitely like, kind of early, but growing space.
and. I think it’s a really interesting time to, to get involved in it.
Ben: [00:44:16] I read in one of your posts, the way that you explained open sea back in the day was eBay for CryptoKitties. How do you explain it now to like a normal person?
Devin: [00:44:28] Right. Well, so I mean, I think because of that, or like, along those lines, like I think if you’re explaining it to crypto startup, you really have to.
no, you want to like tailor it to different groups of people, right? So if someone knows about CryptoKitties, even if for CryptoKitties, this is a good explanation because they know the case is kind of this non fungible token. And then it’s like, Oh cool. You can build like an eBay for all of those sorts of things.
Right. So that was a nice succinct way of explaining to someone who was like pretty deep in the crypto. and I also think like in general, they’re, they’re sort of like. This really wide spectrum of like crypto awareness right now. because of all the things that are happening and all of the things, and because things are moving really fast.
So like on one side of the spectrum, obviously you have people who feel like. Maybe don’t know about Bitcoin, but that’s a pretty small group. Right. And then you have people who know about Bitcoin, but not anything else. And, you know, people didn’t know about like Bitcoin and Ethereum and like maybe some of the other coins that any of the people who know about like Bitcoin and Ethereum and like dApps and that’s like another level.
Right. And then they’re like, then you could maybe talk to them about gas and then you have like people, you know, maybe we know about. The Ethereum, gas defy and that, and then like, you know, even further along, you have people who know about yield farming and like, like stuff like that. So you have this, I mean, if you think about that spectrum, like you’ve gone from like no awareness of, crypto to like, All learning about all of these various things and like yield for me to define the gap is just so wide.
And the gap between even like at someone in the tech media, he knows about Bitcoin and Ethereum and the yield farming community is like crazy wide. Right. So anyway, that was kind of a tangent, but I think. You gotta to have to tailor, depending on where someone is in that spectrum to a regular person, like who maybe knows about Bitcoin, but not anything else.
I would say that, we’re an E-bay for digital stuff where digital stuff includes. Things like event tickets, domain names, game items, that you can trade outside of the place where you bought it. It’s like we can resell it on OT. And I think that, you know, going into a little bit of depth and like why this digital stuff is no different than, you know, the typical game items.
I think that as long as, the individual has like some degree of. Experience with online games or some sort of digital asset usually is a pretty good, it’s good enough to kind of get them, aware of like what we’re working on.
Ben: [00:47:15] Get them aware of it and send you down a 30 minute conversation on why NFTs had the big, next big thing.
I would imagine. Speaking of the next big thing, wanted to touch just briefly on roadmap, things that are coming up for open seas. So I saw that you recently secured. $2.1 million in funding and November last year. Congrats on that, what else do you guys have planned coming up with?
What gets you most excited?
Devin: [00:47:41] Well, so, a big thing we’re working on right now is kind of completing a, a substantial redesign the site that we think will make it a lot easier for people to, do sort of the price history associated with different assets. we, like. Browse different stuff. just, you know, a lot of like, small things that users have been kind of complaining about, and they’re a bit confusing for, for people who are newer to the site.
So that’s kind of one of our big priorities at the moment. the other big area that we’re starting to invest in is, Going across Chen. So, being able to support any of the teas that exists origins outside of the Ethereum. and, yeah, we were pretty excited about that because, we’ve already seen some, some good, Traction around, entities on other chains.
And, we think ultimately that open seat will have to be a cross chain, platform. So, we’re, we’re starting to invest in that very heavily. And then the last thing is, an initiative we’re calling OpenSky drops, which is sort of a way for us to work more directly with our, partner projects.
So we work with tons of games, tons of artists and, people who are building NFTs. And this is, this will allow them to kind of launch their NFTs to our audience, in more of an exciting way. so we’re lining up a few partners for that, for our first kind of drop of content. coming up in October, sorry in September.
so yeah, those are kind of the main things
Ben: [00:49:08] that makes a lot of sense. I mean, it’s education, right? you’re doing these spotlights on decentral land. This is the value proposition. Then it generates more interest in those properties on your platform. I think that’s, that’s a really good move.
Devin really appreciate you taking the time to have this conversation. I think it’s very, interesting everything about, the NFTs in general and everything you’re working on at open seat. If you want to leave my listeners with any last thoughts or where they can follow you find out more about open seat, where would that be?
Devin: [00:49:35] Sure. Yeah. you can follow us on Twitter at, opensea. my Twitter is Dfinzer. You can, and then the website is opensea.io.
Ben: [00:49:45] Awesome. I’ll link all those in the show notes. Really appreciate it. Thank you, Devin.
Devin: [00:49:50] Thanks for having me
Ben: [00:49:52] There you have it. Thank you for listening. really appreciate your support.
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