Episode 94: NFT Markets Macro Outlook with Ben Roy

[00:00:00] Ben Lakoff: 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 Ben Roy NFTs. They're dead right now, according to the. Again, but all you have to do is spend a little time in our own little echo chamber over here to see that they're very much not dead.

This is a double Ben episode. Fun fact. We're both part of Ben Dow, which is a group of 60 over 60. Bens online. Gotta love it. Anyways. In this interview, we go into detail on what's happening in the NFT market and what Ben thinks could be interesting. Before you listen, please don't forget to like or subscribe or even better leave a review.

If you're watching this on YouTube, please subscribe to the channel and or give the video a thumbs up. These sort of things really help other people find the podcast and I appreciate it. All right, Ben Roy on the NFT Market. Ben, welcome to the Alt Asset Allocation Podcast. Excited to have you on today, sir.

[00:01:16] Ben Roy: Awesome, Ben. Super fun. Been looking forward to it for a while.

[00:01:19] Ben Lakoff: You know, I realize as, as you're doing the intro, I'll share this in Ben DAO, which is a group of 58 other Bens just seems crazy to not have shared this recording with them as we're going onto it. This is being recorded live on Twitter spaces, which is pretty fun.

Allow for a little period at the very, very end for q and a if we have time. But otherwise, you know, recording this and putting it up as a podcast anyways. But yeah, I have known you as a person from the internet for years now. And then we've, I think just before, this was probably the first time I've ever seen your face though.

It's all been audio.

[00:01:56] Ben Roy: Yeah, totally.

[00:01:57] Ben Lakoff: Yeah. But for the rest of my listeners, let's start off. Brief background, who you are, where you are, and how you got into the.

[00:02:06] Ben Roy: Yeah, sounds good, man. No, it's super fun to be able to meet friends from the internet. I think it's probably been almost two years since we've known each other as you know, little display pictures.

But yeah, by way of background I got into crypto in, in 2019 after working in Ottawa. I'm, I'm Canadian. I'm based in Vancouver. My kind of previous career was working in, in policy specifically around international trade stuff. And so maybe, you know, a bit of a weird sort of pathway into crypto, but I guess most people's stories are.

And so it came across stuff sort of, this is I guess bear market times and was on a bit of a internet rabbit trail. And I think Bitcoin had come up as like sort of the, the conversation around it being a macro asset in, in these like international trade sort of circles as a bit of a joke. And so, you know, double clicked on that and went down the rabbit hole, so to speak.

And. Yeah, just sort of spent 2019 mostly learning, just trying to figure out like, okay, what's Bitcoin? Like, what's Ethereum? How do blockchains work? And so kept my job and I was reading, I probably, I think I read about half a dozen books, like five or six books on like the history of computing, like what's distributed systems?

Like just what the hell is this thing? Like what's cryptography? How does it make sense? Like I remember trying to read the Bitcoin White paper and being like, I don't know any of these concepts, , so I have to figure out how to sort of put them in my, in order in my. And fast forward sort of through to, to 2020.

After doing that for a little while, picked up my first job in the space for kind of a small startup called Geer, which is I think probably how we would've first interacted with each other, Ben. And yeah, it was just super interesting to, to learn, like this is, I guess sort of through defi summer and, and onwards building a little software tool, kind of a staking solution which still exists and is still used and has a bunch of different sort of suite of tools, we'll say for, for defi, develop.

And yeah, kind of that, that was my first entry, kind of full on into the space and have, have kind of been around since. And, and through 2021 I. I spent a bunch of time working for a company called Tribute Labs, which is a Dow operating company that does that effectively, helps run a bunch of different investment Dows in the space, including Flamingo Dow and, and the Lao and, and Neon Dow.

And so learned a lot through that. And I guess the last piece of this here is have started a few of my own projects since one of those is is called Accelerate Art, which is a non-profit around kind of the digital art space and doing shows both in kinda the virtual worlds and also kind of, we did a show in New York for T M I C and just trying to help emerging artists basically.

And then the, the second piece being an NFT project, specifically called Good Minds which intentionally was like a bunch of of friends of mine decided, you know, it would be interesting to try and build an NFT project from scratch and then use that as a bit of a test net to help other you know, pro protocols and, and projects in the NFT space succeed.

So yeah, effectively like your friendly neighborhood PFP project that's, that's around if you need some help or you need to test user base, And that brings me to today. So that's kind of the, the quick spiel.

[00:04:59] Ben Lakoff: Nice. Yeah, and it was Geer that where I met you and for my listeners, episode 15, so this is November, 2020.

I actually sat down with pre from the la the decentralized venture investing. So pretty early days of that. And pretty interesting what tribute labs and the Lao and Flamingo Dow are doing.

[00:05:20] Ben Roy: Cool.

[00:05:20] Ben Lakoff: Let, there's a million different ways we could start this off, let's start off with NFTs a little bit, like double click there.

So presumably at this point you're kind of the you know, air quote NFT guy with your friends and family. There's always like those people that just don't, you know, air quote. And you have to, you have to like give them some story or some context to kind of get them over the idea over the line on why NFTs could have value.

Do you have a good way of like, describing this to the people that don't quite get it yet? That helps help, that helps them better understand why these things might have value.

[00:05:58] Ben Roy: Yeah, it's a great question. I think it depends on the age group of the person that I'm talking to. So if they're like sub 35, at least until recently, my example was like, imagine if Kanye West created like a Snapchat filter that you could own.

You know, some sort of digital object basically, or customization tool. Would that be interesting to you? Like, do you think people would buy that and most people you know would say, well, yeah, I mean it seems interesting. Say there's only a thousand of these things. And that kind of being a bit of a Trojan horse into just like the idea of digital scarcity, like we have.

You know, so much culture happening online. Doesn't it just make sense that, you know, now we've figured out how you could have like, digitally scarce file types that can capture images or music or memes or things that could, could kind of contain value. And usually that's kind of like a decent entry point into conversations, though I still get made fun of for sure as like the NFT person, especially given, you know, market conditions kind of nuking over the last.

For people who are older, I, I try and think about it more through the lens of music. Not that like, I mean, music NFTs are a bit of a meme in crypto circles cuz there hasn't really been a model that's worked. But it's a just a different way of being able to express the same comment, which is to say like, There is value in owning digital assets.

Imagine if you could own like a piece of an artist's song or catalog from, you know, early days. Like say you, you know, you got into, I don't know, Elton and Sean or something like early in his career. You think, you know, that stuff would hold value and the kind of obvious answer is, well, yeah. And, you know, kind of pitching NFTs as a digital version of that seems to, to make sense for people.

Yeah, so I would gauge it differently, you know, based on the, the age of the person. But those are a couple, couple versions of the.

[00:07:34] Ben Lakoff: Yeah, I like those. And it definitely needs to be tailored based on that person's experience. I think of this story I was meeting a friend of a friend, let's call it, and it was an older fellow, and I was explaining, you know, what I did with church particles and how it does certain things within fts.

And he was shaking his head and like, seemed like he was understanding the whole time. And then like near the end of my spiel, and I'd been talking and he'd been active listening, so I thought he was like getting it. He stops me and he goes, oh, you do computer stuff, .

[00:08:10] Ben Roy: I was like, oh shit. Yeah, definitely should

[00:08:13] Ben Lakoff: have led with that and did not realize you were that lost the entire time, sir.

I've definitely for sure being aware, adjusting it based on who you're talking to. So with NFTs right now, I mean, there's a bit of the narrative that NFTs are dead, volumes are down substantially et cetera, et cetera. Let's let's start off, I mean, this is being recorded in November 20 22.

What what's kind of the state of the NFT market and what areas are you finding most interest?

[00:08:48] Ben Roy: Both good questions. I think. Yeah, state of the NFT market is what I would say is not great. . I think some of the sort of core assets like crypto punks or board apes, or I guess art blocks have made a, kind of, made a case for themselves.

Like there's a historic reason, maybe why some of the people who are from crypto culture land would want to, you know, buy and hold and own these, whether that's like status symbol wise or, you know, as a, as an investment thesis over a long period. But beyond that, as soon as you kind of get out of the, the top crop of, of NFTs, it becomes a bit tricky.

Most stuff is down, you know, very significantly. Even those core assets are down very significantly. I think the, the kind of critique from. Normal, you know, normy land is that NFTs are kind of dead. You know, look at this asset class that sort of the bubble popped and, and this kind of thing. So I don't know.

I would say generally speaking, like it's markets have been down, sentiment's not great. But it's still, you know, interesting seeing like an entirely new asset class that didn't really exist even two years ago holding the volumes that it has held and, you know, holding the prices that it's held. And so to me, I'm, I'm actually quite optimistic.

I think, you know, it's never fun to, to see stuff go down sometimes like 90% or more. You know, people who, who have been around have, have both made a lot of money and, and lost a lot of money. But yeah, I think we're, we're kind of in the, the trough ultimately kind of after the initial euphoria that happens in any kind of new technology.

And the people who are still like around and, and building, whether that's like entrepreneurs or, or collectors or artists, I think are, are, yeah, like having even more conviction ultimately, like realizing okay, you know, markets do what they do. But there's a lot of cool stuff that you can do with this, with this medium.

And I think, yeah, if I, if I had to zoom out and sort of think about it personally I still am kind of more drawn to really two buckets. I would say It's like nerd culture and hype culture. That's kind of how I think about NFTs broadly. Nerd culture being like stuff that is art, that is like maybe using the blockchain in a new way that didn't really exist beforehand.

So you could have had digital art in, you know, 2008, right. I remember actually like watching people videos in my graphic design. When I was in high school and that, like, those existed before but that's not using, you know, just making it an NFT doesn't actually take advantage of all the cool things you can do with a blockchain.

But something like art blocks where you actually have like codes stored on chain or, or terraforms, which goes even, you know, a step further having all sorts of sort of details around this project. Physically, or not physically, but like formally on this, you know, Ethereum blockchain creates kind of an interesting and new class of art that yeah, I, I think I'm excited about.

I think lots of people are excited about, and that's the sort of more nerd culture side of the space and the hype culture side is, I guess what you would think it is just thinking about bigger, bigger companies, something like artifact and, and CLX and that kind of whole really like using clones, which is their core nft as like a distribution for, for luxury products, whether that's clothing or, or other things.

And realizing like Nike in many ways, like invented hype culture. And NFTs are loosely like an extension of that into the digital realm in a new way. And so I think, yeah, those are kinda the two categories that still no matter what is going on in, in sort of, you know, market conditions still are, are exciting to me.

[00:11:52] Ben Lakoff: Yeah,

I like that. Nerd culture and hype culture, but the good way to bucket. That would, that would apply more towards just the art collectibles though. Do you follow, I mean, NFTs is this wide ranging net that kind of covers a bunch of other things, you know, gaming, metaverse, et cetera. Or do you follow any of these other kind of verticals, I guess?

[00:12:19] Ben Roy: Yeah, I think. So I definitely do, I think maybe more my posture here is like, I'm cautiously optimistic, but I haven't really seen too, too much like yeah, like make, make a case for itself or like have a, have a thesis over the long run. I think art and collectible. To me are like the, the intuitive first layer.

And it's interesting to see, you know, some of the projects that I mentioned and, you know, I have a few other projects that I'm interested in or, or that I follow. You know, car Yeah. Carlene for, for themselves. But there's definitely like, you can use NFTs for virgin controlling software. You can use NFTs for creating like liquidity, providing positions in, in Defi.

Like there's all sorts of ways you can use NFTs. I think gaming is, is potentially the. Is both like among the most promising, but also like the most meed and maybe like over talked about. So it hasn't really had its moment in the sun yet. Like I haven't really seen a game that's had traction that's, you know, been based in NFTs.

I do think we'll get there though. And that's what's exciting. I think there's a lot of projects that are, are building now and we'll probably like raise and, and build over the next like 12 to 18 months that potentially tackle, you know, that, that vertical. But you're right, like it's, it's hard to sort of talk about NFTs.

As a, as a single like monolithic thing. I, when I think of NFTs still in my head, I think like art and collectibles and, and that kind of side of it, cuz that's really how it took off. And where I like when I was drawn in. But yeah, you can, you can use an NFT for, for a lot of things. And in the same way that, you know, you'd kinda laughed at if you said you're an internet entrepreneur today, you know where that may have made sense in 2001.

I'm not sure, like five years from now saying like you're in NFTs really will have any meaning. Like it's just got such breadth, like you could use it, like I've said, for like version controlling software or for Yeah, like art projects on chain or for, you know, finance applications and you know, the list goes on.

So in short, yeah, like for sure I'm following lots of stuff. Potentially like bullish on particularly the gaming side of things. But yeah, kind of still waiting to see that stuff play out. Oh yeah.

[00:14:10] Ben Lakoff: And we'll have a massive of reaming. But the funny thing is, like, I hear people say they work in digital advertising, but non-digital advertising, like newspaper ads and billboards, like, come on,

Yeah. I'm in the billboard business. Yeah. You know, it's super targeted, I guess. Put it in the right spot. One thing I realized I didn't touch on. So I have a few things that I want to cover. One, your kind of origin story on how you initially got attracted to NFTs and started going down the rabbit hole.

And then I wanna go into the Fat Crypto punks thesis that you wrote on Medium and I'll link that in the show notes, so wherever that kind of fits. But those are the, those are the next two I want to.

[00:14:58] Ben Roy: Yeah. Awesome. So I think my first exposure to to NFTs is actually like right at the beginning of, of when I got into crypto.

So as much as I had sort of a macro, like I came at this from a policy person, As a policy person and, you know, bought a little bit of Bitcoin and experimented with that. The first thing I ever bought on, on Ethereum was like, decent land and God's on chain cards cuz I was like, okay, like Ready Player one.

I like that movie, like this idea of a metaverse, like maybe I should buy some land in this, like, virtual world seems promising. You know, I'll buy some cards. Like I, you know, grew up sort of collecting Pokemon cards and that also made sense. So I, I definitely had sort of a, a first exposure in back in 2019.

So Open C was pretty, There wasn't really a lot going on. And I followed that through kind of Defi summer as well, which was through, through 2020. There was kind of a lot of yeah, euphoria and, and development and, you know, different builders building things around the finance vertical of crypto.

Where, where NFTs were kind of taking a backseat. But I remember in the, the end of the summer of 20. There's a project called Don't Buy Meme by Jordan Lyle, who is another sort of builder in the space who's been around for a long time. And the basic concept there was taking a lot of the knowledge that exists in this, like defi vertical you know, staking some asset in a contract and using that to like quote unquote farm some secondary asset.

You know, he created this, this concept where you could buy some, some of his token meme and you'd be farming pineapple points. In a very uniquely crypto kind of crazy environment, and you could use those pineapple points to like purchase different NFTs. Most of these NFTs were just like memes of the core crypto characters like Satoshi and Vitalic and Sergei from Chain Link and things like that.

And so while, like I got the initial exposure in 2019, in 2020, that was when I was starting, like trading these, these cards. Like I try and earn, you know, a bunch of pineapple points, buy my card and sell it on open sea kind of thing. And that tipped me off into kind of the, the crypto punks universe and Later, you know, art blocks and kind of on from there.

But I'd say yeah, initial exposure through, through kind of open sea and then to central land and then this like don't buy meme project kind of clicked me back in when, in the end of 2020 they, they stopped calling it defi summer and sort of, sort of at the time sort of called it. Nft winter as the kind of, you know, transition from one bubble to the next.

And turns out that was quite early, obviously, in this like crazy 2021 and even 2022 extension of like NFTs really having their, their breakout moment in the whole, yeah. In the whole world. And yeah, I, I guess that, that can like naturally segue into this, this essay I wrote on, on crypto punks back in like February, I wanna say of of 2021.

Honestly, it was just, you know, in the crypto punks discord these things weren't super valuable. I think it was there, there were a couple e at the time. So you're looking at whatever, maybe like a thousand dollars or something. I wish I had an enormous sum of money and had bought all of them and, you know, made incredible money.

In, in the interim. Alas, that was not the case. You know, I bought, I think one and was excited about that and kind of participating in the community and I just, I feel like there are moments in really any kind of you know, renaissance or innovation era where you just gather a group of really smart people and, and a lot of interesting stuff comes out of that.

And I feel like in crypto, like often that, that happens in specific Discord servers and the crypto punk's like Discord server at that time was just, it wasn't huge, but it was filled with a lot of really sharp and sharp people and really early adopters. People who just got the space far, far better than.

And I feel like I learned a lot and a lot of those people ended up going on to, you know, found projects and, and be like leaders in the space, whether it's like snow throw and, and art blocks, or like ds doing all sorts of NFT stuff for, you know, Justin with brain drops and G money. Like there's a lot of these, these.

People did, did very well for themselves after that. But basically like floated around that Discord for a while, kind of gathered a bunch of the way that they saw Crypto Punks and wrote, yeah, wrote this essay called the, the Fat Crypto Punks thesis. And the long story short, the idea there is that crypto punks, given that they're sort of the, they're not the first NFT at a technical level, but they're among the first NFTs that really like made it click for most people, they combined.

The collectability aspect of being able to own sort of a digital item, like a marketplace, sort of a community around that that set in that marketplace, like they invented a lot of. The usage of like traits and a little sort of set of, of characters that yeah, like had some sort of scarcity inherent in it.

And I felt, and I, I definitely was not totally original thinking at the time. I, I wanna make sure to emphasize that. And, and a bunch of other people felt that the, these could be super valuable and, and like historic assets. And so the point of this, this Fat Punks thesis is the idea that people would go out and you know, potentially make money in this like new vertical called NFTs and probably take some of those profits back to crypto punks.

And, and want to sort of collect and own those as like, almost like a base asset or a reserve currency of this new NFT space. Because they were kind of the, the base yeah, like the core NFT collect. And I think initially that, that I think played out a little bit where people, you know, collected crypto punks and they, they obviously did very well for themselves.

But beyond that you know, it also sort of failed as a thesis as people went on to, to buy other collectibles and sort of create and store value elsewhere. People. Turns out not everyone, you know, wanted to be able to buy a punk. They liked pudgy penguins or board apes or other, other like collectible.

But it was definitely an interesting exercise in like capturing kind of a moment in time where I think a lot of those early folks said, Hey, like these cryptos are, are pretty interesting collectibles and there probably is gonna be a lot of value capture here. And so when I look back on that, I, I think it's, yeah, just kind of fun to be able to have a, a little kind of capsule of, of history and say like, I still think Crypto punks will do very well over time, and there's still in many ways like a case for, for that thesis, but, It was a super interesting kind of early moment in, in the industry.

Yeah.

[00:20:32] Ben Lakoff: You said it kind of failed, but a a bit, but like, how do you think of, I guess, Lindy effect with these old collections of NFTs that have this, this value in this name versus like the, the onslaught of new shiny. The next board ape that seems to launch every couple days.

How do you think about where value flows in the NFT market overall with this dynamic?

[00:21:05] Ben Roy: Yeah, I think The way that I look at it is like, it depends on kind of the, the timing of, of a given market. So in a bull cycle, you know, a lot of people are looking for kind of the next big thing. And they want to, you know, mint an MFT for super cheap and hopefully sell it for a bunch more money and, you know, make money that way.

And in the same way that sort of like Bitcoin isn't a super attractive asset. in a bull market because it, it only goes up so much and people want kind of hunt other, you know, cool coins to buy and then flip you know, these core assets like a, a crypto punk. While they will do well, they don't maybe do as well as, as some of these other like, earlier opportunities.

So in full like bull raging bull markets. I think, yeah, like you start to see people go out the risk curve and, you know, those core assets still appreciate it. Still interesting, but they don't go up as much. I think in kind of a, a bear market or, or that sort of season that we're in now you start to see a little bit more concentration around like value accrual.

So people will start to buy the core assets like crypto punks or like art blocks or, you know, like X copy these, these sorts of things. And I think. That cycle happens enough times that they sort of create their own windiness to, to kind of your point where not only do they have the history of something like crypto punks being made in, in 2017, and increasingly, like if you fast forward a couple years, art block starts to look relatively quite old compared to to other.

Newer collections. So not only do they actually have like the duration windiness, but you have like proof of people kind of storing value or, or like running to that, those, those sets of like core assets in times of crisis or, or when the market kind of nukes. And so I think, yeah, like there's definitely like basically a general case for value accrual to those original.

Objects or pieces of, of culture. And in a way you can kind of frame it as like, here's this moment in sort of art history or, or yeah. Culture in general where all of a sudden there's these original digital assets that you could collect and own. And I think their, their lend, this is like a good Yeah.

Case for potentially owning them or seeing value accrual to those core assets over time. But I say, yeah, that whole like fat punk thesis didn't really work out in the end in a sense. You know let me rephrase. I think a lot of people wanted to explore other collections and just sort of make a lot of money that that way.

And, you know, I didn't see even art blog, honestly doing as well as it did or, or BD apes or these other collections. I kind of had a. A more reductionist version of things. I thought cryptos would kind of stand alone as their own thing and be, you know, head and shoulders above the rest. And they're very important, I would say.

But it turns out that, you know, there are lots of other assets too. And so, you know, I would say maybe it, it did like a half truth, like it was like mostly decently on point for a little while. And, and like you've said, there's kind of a case. These core NFTs that have value over time. But at the same time, you know, you wanna be open minded and humble and realize it didn't really pan out exactly the way that I had thought.

Oh yeah.

[00:23:47] Ben Lakoff: I'd be curious to hear your thoughts or opinions or stance on NFTs, on other chains. I mean, this is something that, speaking a few your own blind spots. I just don't follow what's happening on Tezos or Aptose or any of these other chain. What do you think of in general of NFTs on other non Ethereum blockchains and then can kind of double click on that?

[00:24:16] Ben Roy: Yeah, for sure. I think it kind of depends. It goes back to this conversation of like, well, what kind of NFTs are we talking about? Right? Because I think if you, you know, you're a company and you're building like a AAA game well, I mean, you know, you're gonna have an NFT on a different blockchain potentially on Solana or you know, on a layer two on E where, you know, transaction throughput is much higher and you can actually, like feasibly have a, have a game that people would play.

So I think like it depends if, you know, we're talking about gaming or anies in general, but specifically on this collectibles and art front, which is, is mostly where I would spend my time. I think we've seen, you know, e be the dominant player for a long time. Tezos be a strong second on pure art, like FX hash is kind of another generative art platform like art blocks and that's had a lot of traction.

And Solana, you know, more on this like pfp and like networked art. That's like loosely what I'm thinking about calling these things now versus like PFP collection. It's more like a network of art where people are able to own some, you know, some similar from the same collection. Solana's done quite well, right?

But it's interesting because. I think like, the way that I think about it is they're almost like different countries, you know, like Tezos has a very like European vibe. It's like, let's collect fine art for fun. That's Indie . It sort of strikes me as I'm, you know, I'm both Canadian and German and I just like feel like a very sort of European sensibility around FX hash.

And they're, they're based in Switzerland and it kind of makes sense. Solana feels like very American, very corporate, very casino driven, right? Feels like I'm in Las Vegas. And it's very much about flipping and, and the culture there. It's just slightly different. There's now some good projects like, you know, shout out to, I guess youths is probably the first one that I've seen where you're like, this is like a real strong, intentional positioning of where, like a Solana project that's taking a lot of time, money, and effort to.

But yeah, you, you kind of have these different chains, have different characteristics and, you know, in the same way that you might consider investing in different countries or regions and, you know, make, you know, have trade offs basically accordingly. I think that that's like loosely the mental model I have for, for exploring NFT activity on these different chains.

So e is still like the main the main show especially from an art and collectibles point of view. But I think, yeah, like there's a strong potential that like where organic culture exists NFTs will, will kind of follow. And I think Solana is definitely like in terms of like raw volume or quantitative metrics seeing that and, and Tezos to an extent as well.

So those would be the, the three that I really follow and. To kind of, to be determined. We'll see like where stuff goes, especially like as e scales with, with different layer twos and stuff. Like maybe there's a huge NFT movement on, on Arro or something over time. And that's what's cool. Like this isn't sort of a history lesson.

Like these things are live. And we'll see what happens. Yeah,

[00:26:52] Ben Lakoff: I like that. I think the other one possibly could be Polygon just, I mean their, their business development department. Insane. And with this recent Reddit avatar mania, I think there's, there's probably some, a decent case to be said for polygon NFTs as well.

[00:27:12] Ben Roy: Yeah, good point. Right? That, that's definitely one I missed. I think it's interesting because polygons, like they've won Starbucks, they've won, you know, meta, they've. Reddit clearly like elite BD shop over there. And so we'll see basically, right, like this is kind of the first play where maybe the blockchain is a bit more abstracted away from the core users, where like, you could be a Reddit user and like, you know, you download the Reddit app and have a Reddit vault and collect an nft, but not really know anything about Polygon, where previously the sort of the money or the, the people who are Nft C.

Like, know what chain they're, they're on, they're effectively like early users of the internet, right? Like they're the very high technical people. And so for sure, I think like there, there's a strong case for something like Polygon or even Solana in NFTs as they sort of abstract away to the consumer level.

But I think we're still like early enough that this is, that's more in the category of like, I'm watching it, like I don't own any Reddit avatars. But could be, it could be very big if if it works out as, as they've planned.

[00:28:07] Ben Lakoff: Yeah, I mean in general you know, it seems, we say this all the time in crypto so much that it's a meme, but, you know, we're early.

That doesn't mean everything goes up into the right, but, you know, it is early innings with a lot of this what needs to happen, like what. Building blocks need to exist that don't, or what regulation needs to exist, that isn't quite clear. What, what key pieces are we missing, like, as an NFT market to take this more mainstream and have more people kind of understand and adopt nft.

[00:28:52] Ben Roy: It's a good, it's a good question. I think, I mean, I have some ideas I can, I can kind of throw out there. But one maybe more cheeky note would be like, if, if I knew the exact answer, I feel like I'd be a very wealthy human. You know, trying to, trying to figure out a way to kind of really onboard everybody would be, would be awesome.

I think mostly like it comes down to wallet and, and the kind of basic UI experience being able to collect Nft, how do I actually get money into a wallet and purchase something? You know, I've done this with, with friends, I've done this with my parents to try and like go through all these hoops.

It's just hard, right? You gotta get your bank account hooked up to a crypto exchange and then send that e to a meta mass account. So you have to figure out how to make a me meta mass account and you have to know what a private key is and then you have to figure out gas and, you know, do a transaction.

There's a lot of, of. Steps to this. And really like even just to participate in that, you, you have to have a really early adopter mindset or just like be quite open to new things. And I think every step, I mean they, they study this in sort of, in, in UX design, right? Like every step that you take, you kind of have attrition and, and people not being able to, to follow the, the.

Yeah, like the plan and basically get to the actual purchase moment of an nft. And so you see different people trying different things, whether it's like open C allowing credit cards or, you know, different wallets, maybe building a phone app to make it more intuitive. And those are, those are definitely promising.

But I think from my perspective anyway, if you really want like serious users, like a hundred million plus or billion plus, you're gonna need something that is like as organic or as natural as like a web two login. Whether that's like you log in with an email or something where people are comfort. Being able to, yeah, just like have access to a crypto account without having to do all of these different steps.

And I. Potentially, you know, one way of looking at this is the way that Coinbase earn had a lot of success. Just saying, Hey, like maybe people aren't gonna buy crypto, but they could earn it. Just like learning about it, earning a little bit of crypto could be a good way to kind of expose people to to what this, you know, new kind of currency is.

And I think NFTs could go through that kind of a moment too, where, you know, potentially you have like a, an easier wallet flow and some other way of like earning or claiming different entities just to get people used. And I think, yeah, I, I don't know from a, from a UX perspective, some of the wallet stuff from just like a, at a social level, maybe like being able to collect things for free is an interesting one.

And the regulation pieces definitely a specter over over the industry to an extent. And that would be kind of the third bucket, which is to say, like, it would be good to know that an artist could issue a collection of, of a thousand NFTs that they've. And know that that's not like a security and you know, they're gonna get in trouble just for like a one off sale of artworks.

And I think, yeah, we'll, we'll, we'll have to see how this goes over the next sort of six to 12 months and see if regulators take interest and, you know, being able to offer like clearer guidelines. But yeah, some clear guidelines and some basic UX improvements I think would go a long way. Though again, like I'm not entirely sure.

That. Yeah. Like, I'll, I'll end it there. I think there, there is a case for sort of protecting culture and subculture being interesting for its own sake. And so like the, the open question that's maybe slightly controversial is like, do you actually want everyone to come and be buying NFTs? Because I think like good subculture You know, can penetrate mainstream culture in a different way, in an organic way over time.

And it's something interesting about crypto in general, is that it actually asks you to learn a bunch of new things to kind of get into this, this world. And that's partly why it's a special and interesting industry. So we'll see. I, I'm not entirely sure how it plays out, but yeah.

[00:32:10] Ben Lakoff: Ooh. I like that actually, teasing out that one, that, that's kind of a fun one, right?

I it it's like ex exclusively inclusive. .

[00:32:21] Ben Roy: Yeah, exactly. Right. Like you, I don't know. I think of the process of like what it took to. Figure out how blockchains work and try and spin up an account and you know, I don't wanna romanticize it, but it does feel like you're, you're part of something, right?

Where you're able to actually like, do the work and, and learn something and be part of a new community. And, you know, in many ways, like if you were to, you know, rewind to like 1980, no one knew how to do anything with a computer, right? I mean, I wasn't alive at that point, but You know, it took some time, like people had to figure out like, well, what is an email address and how do I use it?

And so, you know, while I have like my, my core answer of like, you know, you could improve UX in some way, maybe abstract the blockchain away, give some way for people to like, create or like claim NFTs for free. Those things all might help. But the other, yeah, the other part of me says like, There's value in just being able to, you know, have that as a subculture and getting people to learn that might just be the new normal, right?

Like to actually have people get used to using a crypto wallet, even if it's a little bit easier in three years from now than it is today. Like, you know, people don't maybe wanna have like recovery phrases on a sticky in front of their computer. I think, yeah, I don't know. I think there's some level of like value in pursuing technology and in like asking people to a higher standard or calling people.

As opposed to being like, well, like everyone is really stupid in society, so we probably have to make this as obvious as possible. It's like, well, me, but like, maybe that's boring. Right? Yeah. Unfortunately.

[00:33:42] Ben Lakoff: I just always think of like those user tests that you have, like a website that's like, click here to enter and like you, you know, you're watching people do it and they go to the website and.

I don't know how to enter . There is a gigantic button. This says, click to enter. How, how are you missing this? But you know, you have to design, redesign it that make it even more clear, I guess. So never, never surprised. I'd be curious like when you're, when you're thinking through different versions of the future and it, when you've caveated the, the last time of predictions made me think of a Ray Dalio quote.

The he who lives by the crystal ball will eat shattered glass. So keeping that in mind, but, you know, where could things go wrong with NFTs and adoption and they're not. Widespread and adopted as we kind of think they will be.

[00:34:46] Ben Roy: Yeah, it's a good question. I think. I think maybe the, the medium term risk is that these things either get regulated in such a way that it sort of like intimidates most people from participating in these markets or like crypto at large sinks in such a big way that NFTs are just sort of seen as like, Part and parcel with of of crypto, right?

Where it's like, oh, this is just like sort of the speculative of gambling stuff in the same way that if you explain to someone professionally, like even today, like, Hey, like I do crypto. You know, sometimes people might just be like, oh, like that's like the Bitcoin stuff, right? Like, do you also trade drugs on the internet?

Like there's sort of like these initial stereotypes. That are like latent in, you know, just talking about crypto people have it stuck in their minds in that way. And so, I don't know, this is maybe a broader commentary on like crypto innovation in general. And I think, I forget who said this originally, it might have been 65, 29, like punk, punk, 65, 29 or, or someone else who's smarter than me was basically like if you look at the 1960.

You know, psych LX are basically, you know, ruled out and made illegal, and it's only now, whatever, like 70 years later that research is showing, you know, hey, maybe like psilocybin has some positive impact on people with PTSD or depression or like, there's, there's actually use cases for this stuff. And so I think like I would slot this like question of, you know, what happens to the negative for, for NFTs or like, how does this not work?

As like, well, if all of crypto doesn't work out, and then entities also will fail in some fashion, and there's like still a, a reasonable case that, you know, regulation comes along and says, okay, we're, we're not gonna permit like crypto to exist in any way. And as much as sort of the decentralization, Maxs would say, well, you can always kind of make Bitcoin Persist.

And you know, Ethereum is gonna fork its validator set and it's gonna be okay maybe, right? But if you're in a western country, like if Europe and the US come together and say like, it's illegal to own crypto, it's illegal to hold crypto after like 30 days from now most people are running for the exits.

Right. And this actually, now that I think about it, is a 65 29 thread from recently, which is, maybe we can pin that in, in your, your show notes, Ben, which is like, kind of making the case for how crypto fails, like what the steps would be. Kind of, he's gaming it out as a, the. And so yeah, if crypto at large kind of hits a, a turning point in society and we just like, don't permit that, which I think would be a, a great mistake cause there's lots of cool potential and I think anyone who might be listening to this probably would agree.

I. I think, yeah, like there, there is a world where like crypto at large kind of tanks and NFTs are just sort of, yeah. Like seen as part of that and fall apart along with it. That would be the main concern. Cause I think that that's the steel man case for like, how it fails. I really struggle to see that, you know, that world playing out cuz I think in so many ways.

Just the idea of like a, you know what, we started this conversation talking about like a digital asset. Some digital, digital representation of, of an. Seems so intuitive and seems like such an unlock on across like so many business verticals. Forget crypto specifically. That I think, yeah, like even if the NFT quote unquote NFT space doesn't look like what it does today I would struggle to see, yeah, a world 3, 5, 7, 10 years from now where the concept of a digital item of scarcity is not used pretty.

[00:37:47] Ben Lakoff: Well, when said like that , yeah. I've gotta reach out to you and get that link and I'll put that in the show notes. What right now are you most obsessed with within, you know, it can be the broader crypto market or in fts?

[00:38:05] Ben Roy: That's a good question. I. Yeah, my sense is like I, I would split this into a couple different buckets. I don't have a singular point of, of obsession at the moment. So I'll, I'll tuck that aside. But I do think. What I've spent a lot of my time on is trying to figure out how gaming works or could work using NFTs.

So there's, there's a, you know, on chain example of, of something called realms which is building on, on stark net. This is sort of arises out of the, the loot ecosystem. So this, this idea of like, let's, let's push the boundaries and see what we can do and have like a. Quote unquote, on chain gaming experience where like all the, the items, and in this case, like there's some, there's some land in that universe.

There are, you know, are characters there's like resources, like what happens when all of it is on chain. Like, can, can we make that work? Can kind of, an economy work can kind of like a permanent and perpetual game system work. Can you create an ecosystem where other people can build on top of that game in some fashion?

That, that, that is like something that really kind of interests me. And I think it's also just interesting to see someone take a, yeah, like to take a real run at trying to build a, a game as well as, you know, use crypto. It's not, I feel like for most, for the most part, my experience has. Crypto gaming is kind of ghettoized where it's like, let's like be crypto people and try and make a game out of this instead of like, let's be gaming people or let's be like equal parts at minimum gaming people and crypto people and try and build a good product that is interesting for people.

And so realms has been kind of a point of interest around NFTs. I think I'm still really interested in generative. And, and my kind of price range has been more ethics hash recently on, on on Tezos. And I say that because it's like quite relatively speaking, quite cheap. You can buy some, some stuff for a lot of stuff actually for under a hundred dollars and participate in kind of a minting process and just like learn how generative artworks So something I wouldn't, again, I wouldn't say that's an obsession, but I would say that's like a bear market pastime where I like still sort of collecting stuff and that makes it much more reasonable, you know, to weekly go and collect a piece of art in some way and, and, and support artists.

But yeah, I think on the NFT front, those are, those are maybe my two answers. I don't have a, a good Mental model for it. I do still broadly think about NFTs in that nerd culture versus hype culture kind of yeah, binary. And so I would say like right now I'm sort of more in the nerd culture side of things.

And that that's the kinda area of NFTs that I'm interested in. So one another project I can throw out there. Is Forgotten Ruins wizard Cult, which sounds like a mouthful. But it's potentially one of the coolest NFT projects around, in my opinion. And I think in, in many ways it's because it, it sort of like captures nerd culture in, in the best and most interesting ways.

And so what you have is it's collection of, you know, 10,000 wizards and they're sort of follow on collections and things, and they're creating, and they've, they've really said as much in their own words, like they wanna create like a top 10 fantasy. Ever, like where they're talking like Harry Potter, Lord of the Rings, like Dungeons and Dragons, like that level of, of like brand.

It just so happens that it starts or. In, in kind of the Ethereum universe and seeing what they've been able to do and to like use NFTs, I guess it's like slightly adjacent to NFTs, but to just like actually use NFTs to craft something of that stature or of that scale. Obviously they're, they're not there yet but they're, you know, deep in the process of like building a game and doing all sorts of different things and building a, having a TV show.

They're kind of the one of the first examples that I actually throw out there in these like dinner party conversations with people who aren't in, in crypto in any way. Cause you're just basically using NFTs as a way to like have IP that you actually own. And you can kind of think about the addressable market of something like Harry Potter or Lord the Rings or just fantasy in general.

And, and they're being like a quite a clear lane in my opinion anyway. For yeah, like a fantasy based nft. And so, yeah, that's a smattering of answers, but that's some of the things that I've, I've spent some time thinking about recently. I love it.

[00:41:45] Ben Lakoff: Those are some good ones. Well, Ben, it's been a good conversation.

Anything else you wanna touch on before we wrap this thing up?

[00:41:56] Ben Roy: No, I think, yeah, no, I think we've, we've covered some good ground. I would just say, I think where I'm at at the moment is I'm enjoying just like seeing the people who have stuck around given like crazy market conditions and just trying to, basically trying to geek out and, and learn as much as I can about.

You know, new things in the space, ways that people are pushing it forward particularly obviously around NFTs. And I think while, you know, it might be a tricky short and medium term here, there's just a lot of cool stuff going on for, for people who are willing to kind of look and, and dig in.

And yeah, that's what I plan on plan doing over the next, you know, six to 12 months and excited to see what happens in the.

[00:42:29] Ben Lakoff: Indeed. And it's actually kind of it sucks when all of your assets go down by 75%, but the good people are sticking around and there's a little bit more like quiet for today to kind of work on, on some, some big interesting things.

Lastly, where can listeners find out more about you good minds or wherever else you would like to?

[00:42:54] Ben Roy: Yeah. Awesome. I think Twitter's probably the best place, so I'm at Ben Roy double underscore. And that's usually where I'm, I'm posting a lot of stuff that I'm thinking about or you know, running Twitter spaces and things.

Good minds is at Good Minds nft. So that's kind of one of my main projects at the moment. And, and we, we do run like a Good Minds Mondays Twitter space with, with different NFT projects and artists and entrepreneurs each Monday. So, so those are fun. If, if people are in. But yeah, mostly, mostly on Twitter, man.

Awesome.

[00:43:22] Ben Lakoff: Ben. Been a pleasure. Really appreciate having you on today.

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