Episode 73: Blockchain and Web3 Gaming with Ryan Wyatt

Ben Lakoff, CFA
June 6, 2022
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Today's interview is with Ryan Wyatt of Polygon Studios.

Ryan is the ex Head of Gaming at YouTube and made the jump full time into Web3 with Polygon Studios earlier this year. Web3 or Blockchain gaming will be huge. The future is certainly bright.

I really enjoyed this conversation and we covered a ton including talking about where Blockchain Gaming is today, where it could be going, some pitfalls for game designers, new mechanics that the blockchain allows, some valid arguments that “non NFT gaming” people have, and some things to watch out for as investors in this area.

This is a great one. Ryan Wyatt on Blockchain or Web3 Gaming.

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Show Notes

0:00:00  Welcome and context    

0:00:17  What is your background?    

0:05:00  What is Web3 gaming?    

0:09:35  What is the current state of Web3 gaming?    

0:13:35  What valid arguments gamers have against Web3 gaming?    

0:17:21  Gaming within other ecosystems    

0:23:30  What common misinformation you keep hearing?    

0:26:35  Where can things go wrong for Web3 Gaming?    

0:30:30  What is the most overhyped aspect of Web3 gaming?    

0:33:15  The timeline for Web3 gaming    

0:38:10  How can DAOs complement web3 gaming?    

0:41:05  How can investors get involved with Web3 gaming?

Show Links

Major League Gaming

Ryan on twitter

Polygon Studios

Helpful other Alt Asset Articles

Episode Transcript

[00:00:00] Ben: Welcome to the alt asset allocationpodcast, exploring alternative investment opportunities available to theeveryday investor. Here's your host Ben Lakoff.

Hello and welcome to the alt asset allocation podcast. Today'sinterview is with Ryan Wyatt of polygon studios. So Ryan is the. Ex-head ofgaming at YouTube and made the jump full-time into web three with polygonsstudios earlier this year, web three or blockchain gaming, this is going to behuge.

And the future is certainly bright. I really enjoyed thisconversation. We covered a ton talking about where blockchaining gaming istoday, where it could be. Some pitfalls for game designers, the new mechanicsthat blockchain allows and actually some valid arguments that these non NFTEgaming people have, as well as some things to watch out for, for investors inthis area.

Is a great one. Give it a watch, send me your feedback andplease follow me on Twitter so you can join these live conversations. Next timewe actually had a really good Q and a section that I've cut out for this. Itwas really, really fun and rewarding. All right, let's do this. Ryan Wyatt,blockchain or web three gaming.

Enjoy Brian. Welcome to the altar asset allocation podcast.Excited to have you on today.

[00:01:22] Ryan: Welcome. Yeah, thanks for having me.

[00:01:26] Ben: Absolutely. We're doing these via Twitterspaces. So I would encourage my listeners in the future to jump on and you canask questions at the end, but we'll do the podcast portion and then we'll openit up at the end.

Before we kick things off, let's start off with a brief introinto you background and your role right now with polygons.

[00:01:49] Ryan: Yeah. So I'm kind of a lifelong gamerworked in the gaming industry, my whole life and career. I got really intostart playing video games when I was three years old, very young got intoe-sports.

Oh, gosh, this would have been in, you know, about to the earlytwo thousands playing Counterstrike competitively got into call of duty becauseof competitive competitively commentated e-sports for awhile. While in collegein early days worked for a company called major-league gaming, which was one ofthe large tournament organizers in north America.

So all my, all my passionate love for gaming really was rootedin e-sports in live streaming. Spend some time at a company called Machinima,which was like, you know, try to aspire to be a, you know, like the MTV of, ofgaming on YouTube. And then I ran and started the gaming vertical YouTube,which is one of the largest businesses on YouTube is as you can imagine, gamingcreators, gaming, streaming gaming video.

And so did that for close to almost eight years. And then. Whowas an angel investor in web three started last year, really like investing inreally cool blockchain games and other blockchain based apps. And basically waslike, I was becoming so enamored with the space that kind of advising andinvesting wasn't.

Enough of my time. Right? Cause I just was wanting to spendalmost all my time in it. And so you know, after leaving YouTube, I came topolygon and I just loved everything about polygon. I'm a big believer inEthereum. I think in order to scale it theory you need a company just likepolygon. I thought that the team did such an incredible job, like having thosediverse texts.

And then on top of it, you know, they really did a good jobgetting from zero to one, really, really well as founders and entrepreneurs.And I thought I could bring a lot of value of helping do the one-to-one ahundred thing. And so what polygon studios is, is effectively, it helpsdevelopers creators.

However you want to look at the ecosystem. Integrate polygonstech stack, and then making sure that we support them through their lifetime onpolygon. So even after they integrate, we're here to be advocates andsupporters of the developers. So that could range from helping with, you know,smart contract auditing to go to market.

So economics to game design, to investment and everything inbetween, but we really want to be at service to the developer ecosystem. Andhonestly, that's what studios is all encompassing. And so I'm leading theorganization and building out a team that's going to be focused solely onmaking sure. When developers build on polygon, we bring value much likecompanies when they're raising funds, they're looking for people who are goingto strategically help them outside of just capital.

We look at polygon is the same way as developers are going toneed a variety of things to help continue to support them. Long-term we want tomake sure that we demonstrate we care much beyond just them initiallyintegrating on the platform. And so that's the long-winded answer to

[00:04:34] Ben: No. I think that that really helps kindof set the context for this conversation.

So one, you're definitely getting your parents back when theysaid like playing video games was not a good use of your time. First

[00:04:46] Ryan: I have

[00:04:46] Ben: for sure. Types of careers. You know,your parents listening, it's not that bad when your, your kids are playingthese games. Sometimes there's a lot of lessons they learn, but we at chargedparticles were massive fans.

Polygon, I'm big fans from the get, go. Excited to see you withpolygon studios, but coming from the head of gaming at YouTube, I mean, let'sstart off and just back up and define web three or blockchain gaming, what itis and why it could be so important and, and, and allure, somebody like you tocome over from a position at

[00:05:21] Ryan: YouTube.

Yeah. I mean, I have like one of the, you know, personally, itwas one of the coolest shops in the world. I loved it so much. You know, Ireally enjoyed my time there and I learned a great deal and and thought, youknow, we, we did a lot of great things as a team and organization and, youknow, everybody that works on the YouTube gaming team I hired and I think veryhighly of, and I'm excited to see what they continue to build.

You know, for me, it was, it was kind of. It was a variety ofthings that got me excited about it. One, I just think in the spirit of whenyou were spending more time in, you know, digital worlds, digital environments,you know, were tethered into devices, those experiences are getting much richerand, and more complex.

And I felt like people are going to continue and it's alreadybeen demonstrated in gaming industries. People spend a lot of money on digitalgoods. Right. And I think what was going to, you know, my, my expectation isthat people. We'll have a higher expectation than just a license for an item orwhatever.

It may be your right debt. As they spend money in this digitalworld, they're going to want that value to be recognized and realized. And so Ireally became fascinated with the concept of just like blockchain appdevelopment from this alone. Right. And I, and. Really then started to go downthe rabbit hole of seeing very talented developers leaving the major gamingstudios to fundraise there's.

We've never seen this much capital in the history of gamingbeing deployed in the gaming industry, both web two and web three, obviouslydisproportionate amount of this is going through. You know, on chain games. Andso it was just this like really unique inflection point in tech, where I feltlike this is going to be a great opportunity for me to jump in.

Right. I'm not a crypto native, you know, person. I wouldn'tidentify that. I don't have a story about how I, you know, got into Bitcoin in2015 and stuff. Right. I immediately became fascinated because it was like, oh,this is great. Now you're starting to marry all of these awesome concepts thatgaming has already done a really great job of developing, you know, having apoint system, having digital cosmetics, digital goods that you can participatein the game in different ways.

And so for me, it was just this natural evolution and I wantedto be a part of it. I also wanted a new challenge. When I came into to YouTubeto you know, start the gaming business and gaming vertical, it was a great newchallenge. Right. You know, creator economy was on the rise, you know, figuringout how to, you know, work with creators to monetize, to incentivize and helpthem develop better content.

You know, thinking about how to scale that organization. So nowI come over here and it kind of takes a lot of those same skillsets andbackground and interest. Right. There's an investment on them. You know, I likeinvesting, I'm a venture partner, a big craft. Like I think that took some ofthat in there.

I like scaling organizations and building that, you know, It'sgoing to be here for a while. And, you know, we need to make sure that we scaleaccording to the web threes, astronomic rise. And so and, and the big part ofwhat web 3d truly is, is embracing community. Right? It, you know, this wholemovement is owned and operated by the community.

And so I love that because I think, you know, I really enjoyed,you know, helping creators. Find ways to, to, to build their businesses onYouTube. And now it's helping developers build their businesses on polygon. Andso the similarities were actually really striking. And for me, it just feltlike a next evolution of being a participant in this space.

I never looked at it as like gaming is necessarily solvingthese, your blockchain. Gaming is, is solving these like very uniquechallenges. I look at it as there's this whole new product features. Knowingthat all the data is on chain, right? At the end of the day, it's like you haveall this information on chain.

What can you do with that? What does it allow you to create it?So to me, it's like new product features rather than a solution. It's like awhole new world of being able to develop and be creative in ways that youotherwise couldn't do before. So that's what got me excited and just felt likeI wanted to be.

Part of this and, and spend my time in it both because I feellike I can have an impact in the industry, but I have never learned so much injust the three months, two months I've been at polygon. I mean, every call Ifind fascinating and I'm learning something new. So you know, I'm really into.

[00:09:16] Ben: Oh, yeah. Drinking from the fire hose.Well, firstly, welcome to web three. Gotta love 24 7 365 markets. But thecommunity is fun indeed. At that, that is a hundred percent accurate. Yes. Youmentioned talking about the brain drain a bit from web to. Partiallypotentially the massive funding in web three.

Let's talk about state of the market. I mean, I've heard youtalk in the past about a difference in timeline. You know, eventuallyblockchain will have a fit that have a place in a lot of these games, but gamestake away. Period of time. You mentioned from your viewpoint as an investor in thismarket.

How should investors think about timelines and kind of currentstate of the market where we are.

[00:10:03] Ryan: Yeah. I mean, so I think the thing that,you know, some of the stuff that we've seen out, right. You know, a lot ofpeople are pretty critical of kind of the, the games available now. And that'sa lot of, you know, proper game development cycles are very time consuming.

And I don't think there's enough of a genuine appreciationacross the entirety of this industry. And by this, I mean, web three on thisconcept of. Difficult it is to make a game, right? Like just making a game isvery hard in its own. Right. When you start to add things like free throughhaving marketplaces and economies on top of it, it becomes even more difficult.

And so everybody's an investor now, so that's the thing that'sgood and bad. Right? With these free open platforms and economies. It's greatbecause everybody can be participants. Everybody can be builders, but you haveto know that like the internet that comes with its own set of problems, thatbad actors will take advantage of those things.

So we see obviously they up projects where people are gettingrubbed and we see, and obviously it's good to, you know, regulate, you know,regulatory bodies are starting to crack down on that, but I say all this.People really need to have an appreciation for how difficult it is to make agame and how difficult it is to balance an economy on top of that, whetheryou're talking about plate or earn, or whether you're talking about just like ablockchain based marketplace within a game, that's purely cosmetics.

Do you have to understand some of these things because now thateverybody can be an investor simply off of a product roadmap in a mentioning ofit and empty it, you, you need to be mindful of that. And so I really try tolook at. One, the kind of teams that just show the humility that comes alongwith making a game and the difficulty that it takes.

And that, that there isn't a clear blueprint. I mean, evenactually with its success in the play to earn category has, has gone through anumber of its own problems that they're having to tackle and solve for andcontinue to iterate and build on. And so a lot of it is I'm interested in teamsthat kind of showcase.

How difficult it is and articulate how difficult it is and howthey plan on addressing it. I get very nervous about people talking about kindof games and things that they're going to deliver in 12 to 18 months becausemost likely if they stick to that timeline, it'll be a lackluster product.

And so that's that, that's one that we will go through a littlebit of a, a regression in the industry that'll be natural and good for theindustry is going to be, you know, 95% of these. Projects are not going to workout and that's very normal, the games industry. But the great thing about webthree and blockchain based games is you don't need hundreds of thousands ofusers in order to be deemed successful for a game.

Right? If an indie game in web two launches, and it only getstens of thousands of users, it's definitely a. They lost money on the project.It didn't work out. You can actually launch a game and have a thrivingcommunity and the tens of thousands and went three. And I think that's thebeautiful part about it that you can actually build these experiences that aremuch smaller at scale or more tailored to certain communities that may be moreneat.

And still find an abundance amount of success. So there's akind of, it's like a double-edged sword here. There's like really greatopportunity that is going to open into space, but it's going to come with a lotof responsibility and it's going to come with that actors. And it's going tocome with like how we suss all of this out as a collective industry as wecontinue to spend more time in it.

[00:13:09] Ben: Yeah. That makes a lot of sense. I mean,Kevin Kelly's thousand true fans comes to mind instantly when thinking aboutthis, you know, it doesn't have to be this blockbuster that millions of peopleuse. You can find your niche, you. Touched a bit on hyper financialization ofgame aspects. Everyone's an investor in some of the difficulties and hurdlesthat comes with this, but this leads into there's been as you know, relativelysignificant amount of backlash from certain gamers about an FTS.

I'm curious, what valid arguments from your perspective, do youthink that.

[00:13:46] Ryan: Yeah. I mean, I think they have a numberof valid arguments. I actually am pretty empathetic to it. I think one, when Iwas kind of looking at it, there's a couple of things. I feel like with thebacklash it came from, first of all, you had a lot of crypto native folkstalking about how crypto and blockchain was going to revolutionize gaming,which I think is just off putting in its own.

Right. Because gamers. And, you know, in authentic you're onauthentic behavior. Right. And so I didn't get just didn't really resonate witha lot of the audience that like, oh, you know, everything's going to turn itinto an NFT. Right. You know, imagine in Minecraft, blah, blah, blah. Right.And I think it was very off putting and because people would see at a T.

That are, you know you know, like a board app selling forhundreds of thousands of dollars. And it's like, am I going to get priced outof games? And then you would point to actually infinity is like, oh, here's agame that, you know, is, is, is in web three. And it was like, oh, there's like$800 barrier to entry because you need to own these axes to get in.

Right. So it opened up a number of, of issues there that. Causefor frustration. Also a number of these chains actually have a pretty decentcarbon footprint. And so that's why it matters deeply to polygon that we wantto be well-positioned that we are carbon neutral today, and we want to be carbonnegative actually in the future, Ethereum switching, its consensus mechanismwill help that whole end to end solution.

So not just polygon and what it's doing is an L two or sidechain, but also what Ethereum is doing main debts. And so I think the carbonfootprint issue was actually fair from some folks. I also think people see alot of the projects where, you know, they see friends getting hurt, right? Likesomebody goes in and spends money that they, that they think is going to have areturn.

Or they're really excited about investing in something. And aproject goes to zero because, you know, malicious intent. So I think there's alot of really fair, valid criticisms of NMT gaming. And I think that's allright. Th there's 3 billion gamers and the world, you know, people are going towant a variety of different things and want different things.

I also think implementation was rather poor for mainstreamgaming. You know, like Ubisoft adoption didn't really resonate well to, youknow, it was a very lackluster execution, I think, in the eyes of the gamingand. So a lot of winded. I, I think none of this really matters though, youknow, Ben like at the end of the day, because these are things that willcontinue to get better, right?

Like what you're seeing right now is the earliest products thatare being developed on chain, but people will iterate. People will learn,things will get better. Fidelity of games will get better. Experiences will gobeyond just play to earn games. So then that will start to resonate more. Withcore gamers.

And so the backlog I'm kind of set in the middle where I'mlike, I gave her the backlash is going, but I also have visibility of what thefuture looks like. And it's so exciting. And so I do, I am very optimistic thata lot of gamers will come around to it because they will. Games, you know,games that are built on polygon are carbon negative.

So that's not an issue. You know, there's no really little tono transaction fees and that's not an issue. And, oh, Hey, by the way, this isa really fun game that I enjoyed playing. And so it will be less divisive andit will be less fixated on some of these underlying topics within entity.

[00:16:44] Ben: Yeah, I think those are, those are veryvalid and congrats polygon going carbon negative in 2022.

I mean, just huge. So that, that was a common criticism aboutthe carbon carbon issues. Definitely excited to see that. Curious. There's alot to unpack. And Ryan, I could talk to you for freaking hours about that.That's for sure. There's like 30 new questions pop up as you're talking. I loveit.

But touching briefly on gaming within other ecosystems,obviously you are a polygon Ethereum bowl, but are you interested looking whatdoes kind of your stance on these other alt L ones or and the gaming ecosystemsthat are developing.

[00:17:30] Ryan: Yeah. I mean, look I don't think it's a winnertake all markets.

So and I think that wouldn't really embrace the ethos of wentthrough your community. For me though, you know, I kind of look at it this way.It's like, I'm a bit, I just am a big believer in our theory. Right. And Ithink that their aim is here. And so if you believe in that, then you kind oflike, then you build, you should build on polygon, like, right.

Like main net, Ethereum, especially in games. Right. Like, youknow, made that, that theory and with, with, with costs associated with it,don't make sense for games at scale. Right. And so I kind of look at it that,and sometimes I just wonder you know, if there is already a great solution inplace for a games company, right.

Like, okay. I like polygon the tech stacks. Great. I can, Icould build my own sovereign chain and there's, you know, super nuts there. Ihave. Our public change in our RPOs. We have our Z caves that are coming. Allof a sudden you're like I had kind of have all the tech solutions. I need toreally build my business on Ethereum, through polygon.

And oh, by the way, everybody, you know, has a great richhistory in the gaming industry. That's on that BD and develop a relationshipteam. So why should I be thinking about anywhere else? I think of it more likethat. Then I spent about any other time thinking about what other ones or LTSare doing or what their value prop is because at the end of the day, If you asksomebody, what is the criteria of your chain selection?

And you start filtering out people that are just trying to takemoney you know, get a quick dollar and you started to ask them really questionsof what they're looking for in a chain. I can assure you that like polygon, ithandles all of these ones you know, the, these asks or, you know, clients, andwe want to keep, keep doing that.

So, yeah, I, it will be interesting to see how everybody scalesaccordingly, you know, especially how some of the genuinely achieve scale. Youknow, none of us have. You know, a lot of the , you know, make claims of whattransactions per second, that we can scale to and what we can do long-term buttime will, you know, time will tell and, and, and we will all be tested.

And you know, I think there will be an expectation that we canscale accordingly and, and have, you know, a reliable uptime. And so the chainthat can do that long-term and provide security as well. We'll be the ones thatare standing. And so I think it's good for the industry to have a lot ofdifferent ones.

You're learning and iterating, you know, we're learning fromeach other at the same time as well to even our competitors. So I think that'sactually good for the space. Everyone benefits.

[00:19:46] Ben: Yeah. And all of these blockchains workreally well until 50 million people come on and push the transact at the sametime.

Right. They're becoming more and more battle tested. I heard inthe Bankless interview, which was fantastic in February that you mentionedgames are going to be the largest onboarding funnel for NFTs and crypto. Yeah.Y.

[00:20:10] Ryan: Oh man. It's like it to me too. And Ihope it doesn't come off as arrogant, but it seems like a no-brainer to me.

And the reason I think this is so many fundamental mechanicsand a lot of these games are already aligned philosophically with like howcrypto and blockchain works. Like it's almost kind of comical. You keep it. Oneof my favorite games I play is valor, right? I've always been in a tacticalshooters, you know, Counter-Strike and play valoran you know, as a, as a dadand like CEO, I don't get to play as much.

If you think about that whole experience, it's like you'rebuying riot points, those ride points by visual cosmetic, Ida, right. And thencounter strike, you're buying a digital item and you have a marketplace. Andalthough it's a closed marketplace, it's still has, you know, the ability tosell them. So for me, I'm like, wow, all of this makes a ton of sense.

You come into a game experience, you're buying a token for thatgame. Now, all of a sudden that token actually has governance. It has a valueyou're actually invested in the company in some way, shape or form. Now, all ofa sudden you're coming in and using those tokens to buy digital assets rightnow, you own those digital assets, those kinds of ebb and flow of value aswell.

You actually can liquidate them. If you ever are done playingthat game and want to go to another place you didn't. And so like a lot ofthese core mechanics of. What's happening in the space are actually going to bereally well understood and easily translatable to the gaming audience. And soif you think about it, we go back to that stat.

Let's say, you know, 3 billion gamers out there, you know, even500 million to a billion. Ultimately understand this flow pretty well. I mean,honestly, even if you're playing candy crush or class rail, you understand thisflow. And so I think it will come very intuitively to folks with blockchainbased games and that they will actually become intrigued by it.

Once they get games that are more up their alley and, and, andmore accessible and more broadly appealing. And so it just makes sense thatthat's where it's going to happen because it's not going to happen. It's it'sdemonstrated it's not going to happen through. There's not enough people. Andso I think this is, this is the funnel in which it will happen.

You're just because it's ultimately, it's honestly just thetotal addressable market out intuitively. They will understand these coremechanics and out quickly, they'll just set up wallets and participate in thatspace without even really realizing that they're doing. Instinctively.

[00:22:18] Ben: Yeah, that makes sense very much in thesame way that like NFTs art collectibles have been a Trojan horse to bring inall of these other artists.

Now it's bleeding out to other digital media types. Definitelybelieve that this will happen with gaming. I, I always hear this, like a drumbeat of my NFTE being used in this game carried across to the other game andthings like that. That sound great in theory, but it's kind of hand-wavy andI'm not sure if that will be the exact way that it shakes out.

There are many different ideas on what blockchain or web threegaming could look like. What common narratives do you hear that you disliked?

[00:22:59] Ryan: Yeah. I mean, the inter-operability ofdigital assets is kind of nonsense. Like it's not going to happen. But there'sthere, it's just not like the, between shaders and game engines.

It's just like, it's just full stop. Not going to happen. Nowthere might be worlds where there are asset, you know parameters for people todevelop in and integrate. And so like, maybe that is, but I actually think alot of when I think of like digital, inter-operability like kind of how peopletalk like, oh, You own this, you know, AK 47 at this game.

And like, you can go bring it into this game. Like that's notgoing to happen. But what I would love to see is how non-gaming brands reallyenter the space at scale through NFTs. And I'll kind of break this down andwhat I mean, like, let's take a, let's take a random brand. Let's just. Okay.Let's take a product, right?

So Prada has a line of entities, right? And one of them is aproduct backpack, you know, and I would love for the utility to start to be inthat product backpack that you own is probably a bunch of stuff that productwould be doing. And this is obviously, I'm just making this up. It's allhypothetical. But like, you know, they have a utility of like you get to do ata runway show.

They have a utility where maybe you get a discount off ofsomething or you get access to something and yada, yada, right. I would love tosee polygon, take somebody like. And help them partner with like eight differentprominent games to be like, I want you to make the product backpack and yourgame, the product backpack and your game and Jurgen, because it's a uniquedigital asset.

I want you to create an each one. And I want whoever has theunderlying NFT ownership of that item to be able to access that digital item ineach one of those games. Now that is interoperability in my mind, but thattakes BD, that takes product partnerships and like that's relationshipestablishing, licensing, establishing, and so forth.

I think that'll be a really cool way for brands to enter thespace and add utility to their underlying entities that they own. Right. Sothat they can really start to bring value to it. I don't know that your, youknow, your question was like ideas that I don't like is the interoperabilityone.

Cause I don't think it's realistic, but this is kind of myproposed solution to digital asset interoperability. And it'll have to comethrough the vehicle of partnerships, which is why I put a lot of Value intohiring like a world-class team, because I think it's stuff like that, thatyou're going to be able to bring to the table.

So say game company X is figuring out what chain they want topark. It'd be really cool to be able to bring them in and have like a suite ofthose kinds of product partnerships for them to plug into. And that, thatthat's at the benefit of, you know, the NFT owner that has the underlyingdigital asset, as well as the overall brand and product that's launching it.

And you could do this with like a number of products and brandsyou could do this, does your product use it? Just like a cool fashion example,but you know, you could do this with a burger king and have fun with it, right?There's a lot of different things that you could do here. So I'm lookingforward how we navigate interoperability and.

[00:25:39] Ben: It's definitely not extremely clear how,how that will work out, but I've, I think that approach makes a lot of sensewhen I'm, I'm a bit of a. Crypto permeable and ended up hanging around cryptoprintables and my little echo chamber. As a relatively, like, it sounds likeyou've been monitoring the space, but you know, full on drinking from the firehose, 24 7 now where, where do we just look crazy or where could things go allwrong?

And, and this whole thing not end up as, as wonderful and asamazing as we think it will.

[00:26:15] Ryan: I would say like, kind of my first,let's say 90 days, full-time in this space, an observation that I would haveof, of crypto native folks is that. One it's, there's no like measured take,you know, it's, it's a lot of it and I'm speaking in broad strokes here.

This is not everybody, but I noticed that there's a lot ofthere's no like even keeled measured approach to the space, it's kind of likeweb three is going to eat web two. Fiat's gonna die. Right. It's all of these,like, it's very hyperbolic in the way that it's going. And I think I just havea much more personally in the theoretical perspective on how the space playsout.

You know, and I think it will serve. Large sub section of thetech industry, but I don't see it swallowing all of these things whole. And soas much as I am bullish, I made a massive career jump into the space. Soobviously I am I think my, I think I'm a little. Maybe more, even killed moremeasured than kind of some of the folks that have been in here.

And that's great. Right? Like maybe that's good. I think likeit got to this place because a lot of people have a lot of passion and they'rewilling to be strong advocates and have these beliefs. But that is somethingthat I have observed that is a little bit, yeah.

[00:27:23] Ben: Yeah, that makes sense. Difference inunderstanding of timeline, I think is

[00:27:28] Ryan: that's a big one, right?

I think a lot of people talk past each other because theyhaven't set the context of the conversation in the timeframe. And I also thinkpeople need to be much more patient. It was funny. I was looking at something,he was like the internets and, you know, it was invented in like 180 5 orsomething like that.

And then, you know, AOL comes out in a. Like 93 and when AOL,and anyway, when they went to IPO, it had like 200,000 paying subscribers toit. And so I think people also on the other flip side of that extremism thatwere times Argo are also like weirdly skeptical of web three, because it hasn'tlike doesn't have the Amazon of web three yet.

You know, like it hasn't launched something. It's like mygoodness, you know, the space is so, so nascent and so young, still all thingsconsidered it hasn't been around block. So I also think people need. Morepatient in starting to see the big successes that are going to come out of itand they will come in.

So that's an, and actually maybe the other side of that coin ofthe hyperbole.

[00:28:23] Ben: Yeah and they will come. They just taketime and they are moving quickly, but it's never as quickly as we would want tosee it. So I mean, things are moving incredibly quickly. But you know, it'snever quickly enough, but.

Way more quickly than

[00:28:40] Ryan: before the space is well designed andthe way that development is democratized and that the, and how much thecommunity owns. I actually think it's going to accelerate on a much fastertimeline than the internet, you know, and, and how, how long it took theinternet. Adoption of getting PCs at home.

Like we talked about like the wallet issue, having a lot offriction. Well, like people getting on the internet had a ton of pressurebecause they didn't have computers in their homes. And like that wasn't, thatwas something that was starting to gain traction. And so these same kind offrictions have existed in technology.

And I think all of it will be reduced over time. And I thinkbecause it's so democratized, people will solve. Frictions much easier. Andthey're not in the, because of the global nature of crypto, that's the beautyof it. Right. You know, it's, everybody's on an equal playing field. Thingswill move faster.

[00:29:26] Ben: Oh yeah. Borderless connected 24 7 andthen thinking about fundings, funding and incentives, like it's the perfectstorm for these things to move very, very quickly. That leads me perfectly intomy next one, which is looking at the space now. And I'll get into a forwardlooking forecast later. But what is the most over-hyped aspect of web threegaming at the moment?

[00:29:52] Ryan: The most over-hyped aspect of web threegaming right now. I think for me, it's that like everyone fixates on plater urnas being like this revolutionary format and the games industry. And althoughit's like, it is really cool and it is an impactful format. I think peoplesometimes make the have this misconception that played earned is blockchaingaming.

Whereas I think blockchain gaming will serve as a pretty bigsubsection of the games industry, but plater earn will be a part of. Not thewhole thing. And so I think people conflate that when they're like, oh,blockchain gaming, ease played around and I'm like, no, no, no. He's like verymuch is not. It is a part of it.

So that that's probably the over-hyped part. Cause I think itthen, because of that, people miss the boat. Right. All of a sudden like, oh,blockchain gaming is, I've got a, you know, I'm only playing because I'mearning money behind it. Then like I play games for fun and that takes it outof fun. It's like stop, you know I spend, you know, hundreds of bucks and valorand I'm having a ton of fun and I don't play it because of the earning mechanics,but I can tell you what I bought really cool skins and sees the one that theyhaven't brought back out again.

I think that there's real value in selling that. And I wish Icould actually have more participation and voting for nurse at buffs of championsand agents, right? Like you know, so anyway, I think people reallyunderestimate other awesome mechanics that blockchain games are going toprovide outside of this plater earn bottle, which largely will be tailoredtowards lower monetizing markets and regions.

Like I don't think you'll ever get the token omics balance in away that will meaningfully scale and more Western established. Regions wherethe earning mechanism is a point of focus for the. If that makes sense.

[00:31:35] Ben: Yeah, that totally makes a lot of sense.We're humans, we like mental models. We want easy.

Play the urn is blockchain gaming full stop. You know, it's,it's pretty easy to think about things like that. And that's, people's mentalmodels to understand the space, but it's a lot more vibrant and there's a lotmore going on in the space

[00:31:52] Ryan: overall wild, this service to what'shappening in the space and kind of the projects people are working on.

Yeah. Right.

[00:32:00] Ben: Yeah, I think play to earn, I mean, it isa bit of a misnomer. Like I played a play, I earned, earned play to earn. It'skind of odd to me, but I think aspects of that will carry over and these areall. The practice for the final form and little, little pieces of it will becarried along to the, the next iteration on, on, on next iteration.

I mean, how do you see blockchain games evolving in the nextfive to 10 years or adjust the timeline accordingly? If you have a better one.

[00:32:31] Ryan: Yeah, five to 10 years. I'd just wouldbe like too full of shit to give you an answer, because if I knew what five to10 years is going to be, I'd already been retired by now, man.

Yeah, I think. I think the big thing that's going to happentoo, is you're going to start to see some of these games that people havespent, you know, years building, like, you know, large-scale MMOs and MMO RPGs,and, you know, high fidelity, tactical shooters. And you're gonna start to seegames like this.

Where the marketplace is, you know, is, is kind of an openmarketplace where people are trading and purchasing assets and you know,participating in the token structure and thousands being formed around it. Likeyou're going to start to see these games at scale and people really just reallyjust plug into them as they, as they otherwise would.

Right. You know, like I think some of these things are socommunity oriented. And so what I really expect. The tie, you will see one, thefriction will be significantly reduced people coming into games. So I thinkthat'll be great, right? Like, you'll see that right now. Like D nobody'ssetting up a Medimap spot.

Like, so this crypto like, industry, like get over it. Likeyou're not going to get a billion people on the metal mask experience rightnow. Wallets will inherently get better integrations of wallets and the gameswill get better. And so that will be a much more like the on-ramps and all ofthat will be much more fluid and that's a big hurdle and that, but that'll beresolved.

And then let's say the next five years, like, I don't thinkit's a non issue. Games will be really good with bridging, right? Like ifanybody knows how to take somebody through. Game to understand it. It's, it'slike an experience it's video games, right? Like they are so good at creatingtutorials for people to understand complex things within a game so they canpick up and enjoy it.

So I think games will do a beautiful job at simplifyingbridging in combination with these like, you know, wallets that a lot of thingsare happening in the background and people are just playing and participating.And then, yeah, you're going to see these really great games. I mean, there aresome artists that are coming out.

The other thing I think you'll see are off chain on chainhybrid experiences to open the funnel in that. Well, like, you'll be able tocome into a really cool game. And if you're like so allergic to this openmarketplace aspect of it, then you don't need to participate in it, but therewill have an element of it that allows players to integrate and connect theirwallet and participate on the, the on chain part of it, which I think will bereally cool too.

And I think really good and increasing the funnel of users intothe space. So, yeah, that's what I'm most excited for. Like higher fidelity.More seamless a while integrations and reduce friction points before onboardinggamers. And then that the crypto element will be pretty passive in thebackground.

You're like, oh, X game just came out. I can't wait to go playwith my friends. And you're like, boom, I'm setting up my account. I don't havea Coinbase account. I'm using a Coinbase wallet. Now I am boom. I'm in. Right.You know, you're not talking about the game is built on polygon. You just knowthat the transactions are.

Our really low from a cost perspective and, and you know, we'rereliable, right? Like that's kind of where we gotta be at five years. I mean,it's not really like what I think it will be. We have to be there in five yearsas an industry, because I think people are relatively impatient and we willneed to demonstrate success as a, as a, as a movement and industry by them.

And so that's where I know that's where we've got to get to.

[00:35:36] Ben: I love it. And all the you know cryptodecentralization, purists hated, but this off chain on chain blended, passiveblockchain kind of designed a game. We'll truly onboard more people. They won'tknow that they're on a blockchain. It will have these blockchaincharacteristics, but it will be obfuscated in the background and reduce thefriction.

That's a big,

[00:35:58] Ryan: the thing too about that. Like, Itotally empathize with the people that are decentralized decentralization,purists, and like, that's cool. Like you, you should, and there will be greatexperiences for you as well. Right. You just have to understand. When we get toa billion people on crypto, we're going to need to have, that will be aspectrum.

And the start of the spectrum is information is on chain,right? Like at some point you can't be web 2.5. So like it's on chain, right.Information and data, and all of that is there. And then you will have varyingdegrees all the way to the purest level of decentralization to that. And so I thinkonce people realize there'll be a spectrum and there'll be people that havedifferent opinions on some of this.

And so that'll be, you know, just like people have differingopinions on, on what level of privacy that they're comfortable with and web tosome people like want to share everything. Some people don't want to shareanything. You want to be an Aidan and that's okay that both of those peopleexist and everything in between.

Right. And then the experiences are tailored accordingly.Facebook, you have to have a real name to set up, right. Twitter. You could belike a entity avatar and people could like have no idea of who the hell you areforever. And that's cool as well, too. Right. So I think we'll just have to getused to.

Being okay. With billions of people using something and therebeing something forever.

[00:37:12] Ben: Absolutely. And you touched on this a bitwith metaverse and some of these other things, but I have this theory about theoverall convergence of metaverse dowels, social tokens, defy NFTs, block chaingaming into this, this big thing.

That's no longer. Clear lines. They've all kind of blurred. Doyou have any sort of overarching thesis on some of these other themes withinthe blockchain crypto space and how they play into a blockchain gaming?

[00:37:43] Ryan: You mean like, like Dow's metaverse oryeah. Well, yeah, I mean, guilds make a T I mean, guilds are prettystraightforward just because of the economies and in market.

I mean like good guilds make a ton of sense. That's like kindof the weird, lazy way of explaining is like the evolution of e-sports in aworld where you have kind of like community ownership and pre-market places.And I think gals also are like an evolution of forums and communities, right?Like, because of those same reasons, now they have ways to organize in uniqueways.

So I don't know that I have like a union. Thesis on where thosenet out, other than I think they're both going to be just like integral partsof the evolution of web three blockchain games. Right? Like they just aren't.Necessary and because they can be created in these environments, they, theyshould be.

And I think, you know, the best ones will rise to the top andwill be the main facilitator there. I think with the metaverse, you know, my,you know, the way I, I think everybody, first of all, has a different interpretationof. For me, I kind of break it down very simply. And the idea that we arespending more time on in, on devices, those devices are all digital experiencesand those digital experiences are getting much, much richer and much morecomplex.

And that's kind of like how we, you know, it was talking aboutat the beginning. And so, because of that, you know, people one it's going tobe hyper fragmented. Like I don't think, I do think that Facebook canparticipate or a Google or any of these big tech companies will have a place inthe world.

They're not going to wall garden own it. Like Google owns. Youknow, or like Facebook has WhatsApp and Instagram and so forth, right? Likethere won't be that same dominance level of ownership. I don't think theindustry will allow for that. And I, and I think there will be too muchoptionality of different experiences in the, in this so-called

You, you just can't, you won't be able to get to that level ofownership that you could in web two, which I think is really, really good. So Ithink it's very fragmented and I think it has all kind of different experiencescultivated for different people, much like society exists today where, where,you know, there different strokes for different folks.

And I think that's kind of how these digital worlds werekeeping, you know, created and how people will spend time in them. Yeah. Sothat's my, that's my thought. And then some of them were, I think there wasopportunity for partnerships and interconnectivity between them and interoperabilitybetween them.

[00:39:54] Ben: Oh yeah. All right. Last question. Myaudience with this podcast is mostly investors. Obviously not financial advice,but how should investors think about getting more involved with web three orblockchain gaming?

[00:40:09] Ryan: Yeah, I think look it kind of touchesback on my initial point. There's a lot of projects and a lot of capital beingdeployed in the space.

Right. And gaming before this even was the case was reallyhard. Look at game like halo, you know, with, with hundreds and hundreds andhundreds of millions of dollars at their disposal to create a game. And it's agood game and it already is getting kind of lackluster user base. And they'rehaving to think about how to keep it fresh and do they launch a battle Royaleand all of these things, right.

So just take this from a company. That has launched successfulgames. That was as well-funded as you possibly can be with an IP that like,literally I started playing halo, I think when I was 12 years old. Right. So,and I'm 35. So you know what I'm saying? It had everything going for it and itstill struggles.

So just remember. That's your benchmark, right? That, that,that game, like, if you want to even get as close as the success of that game,think about what has happened to get there the years it took to develop. Sohave again, appreciation for what, you know, what takes to make a game thatgets a critical user base.

Second, I think it would be to make sure that you have peoplethat understand both token, omics and game development working together. Ialways like when I'm looking at kind of decks, I like forefront of people thatare talking, like we have this game dev team and we have these people that knowexactly how to monetize the ecosystem and work with it.

And like, those are so critical. Anything. Can you besuccessful? Absolutely. Right. But you really, really are reducing thecertainty and an already world where there is no certainty. You're reducing theprobability of it being successful. And you're starting to deem luck because ofthe complexity of game development and so economics and, you know, balancingeconomy.

So anyway, I think to investors, it would be. Highly criticalof those two things instead of like, oh, you know, I like the founders and thegame looks cool. Right. I think people are not scrutinizing that. And my lastnote on this, and then we can, we can stop my last note on this would beunderstand that there has been billions of dollars deployed in game developmentand the.

24 months, right? Both from venture big game publishers, alsoMNAs and likes. We've never seen the outcome of this, which we haven't seen yetis going to be so many games. The optionality for gamers is going to beabsurdly high, which is great for gamers. Right? We're going to get everythingwe ever wanted in every way, shape and form, but you're going to see a massivefragmentation.

Of game audiences instead of this consolidation into a handfulof titles, like you've seen, this is going to start to get disrupted. It's goingto have an impact on the Twitch streaming, the YouTube gaming of the world.It's going to have an impact on the creator economy and a good way, right,because of the fragmentation.

And so I think people should understand that, like developersbetter have an awesome. Go to market and community element or else doesn'tmatter if you just make a great game, that will not be enough anymore to justmake a great game. And so I think a lot of developers are, I'm going to put myhead down.

I'm going to make a really cool game and I'm going to come upfor air and then think about how we actually tap into, to go to market strategyand activate. And I think they're going to be in for a rude awakening if theydon't think about that much earlier in the development cycle. That's it. Sothose would be the questions if I do invest.

So these are the questions I asked, but this is how I wouldlook at it.

[00:43:31] Ben: Man just gold Ryan. Again, I could justtalk to you for hours on this, Ryan really appreciate it has been great.

There you go. First off.

Thank you very much for listening all the way through. I hopeyou got a lot of value out of that conversation as always.

You can find show notes, links, and more. Alt Please share this with anyone you think might be interested inderive any value from this conversation. And as always, you can reach out to mefor any feedback or questions. Please give the video a like, or even bettersubscribe on YouTube or your podcast player of choice.

This really helps others find the podcast or the video as well.Thanks a lot. Hope everybody has a fantastic day and stay safe out there andinvest with. Cheers.

Ben Lakoff is an entrepreneur and finance professional. He has developed strong global finance experience through 10 years of international assignments in the US, Brazil, Afghanistan, Southeast Asia, Czech Republic and through the award of his Chartered Financial Analyst (CFA) certification.