The iNFiniTe Metaverse, Part 2: A Guide to Renaissance 2.0 & the Creator Economy
The iNFiniTe Metaverse, Part 2: A Guide to Renaissance 2.0 & the Creator Economy
How to Avoid Web 2.0 Pitfalls in a Web3 Metaverse
Before we get started, please note that this is Part 2 of “The iNFiniTe Metaverse” series. If you haven’t checked out Part 1 yet, click the button below. 👇
In this article, we will be covering:
The staggering similarities between the first Renaissance and the upcoming digital Renaissance.
The data behind why so many creators, investors, and big companies are going all-in on the Metaverse.
Why all of us will soon identify as creators, and the importance of “branding” our own unique identities and communities in Web3.
The pitfalls of building in a Web3 Metaverse with a Web 2.0 mindset.
Which Web3-native projects are using NFTs to build for the Metaverse the right way, which ones are struggling, and why.
The Digital Renaissance: Web3 & the Open Metaverse
The era of Web 2.0 started with a utopian vision of democratizing the global flow of knowledge and human expression. Social media gave rise to a new and growing class of creators: artists, musicians, writers, developers, bloggers, streamers, and even Mukbangers…🍴
In many ways, this was a positive trend. More people were able to find an outlet and an audience for their creative expression, and perhaps even generate some income from it. However, The Attention Economy has ultimately turned into a passion economy - one that benefits Big Tech shareholders, vs. a creator economy - one built on a creative middle class.
“For the Internet to thrive, content providers must be paid for their work.”
- Bill Gates, Content is King Essay, 1996
If Web3 and the Metaverse is to usher in a digital Renaissance, the past and present day remind me of the time leading up to the Reformation that disrupted the religious power at the time (in modern context, Big Tech 🔥). Echoing how the church controlled the population and influenced the majority of art prior to the Renaissance, a handful of big companies today have undeniable control over our data, our abilities online, and the types of creative content that gets rewarded (all behind black-box algorithms 🤖).
Metaverse and social media platforms today rely heavily, if not entirely, on the value of UGC (user-generated content). Most egregiously, these companies often take ownership and distribution rights over UGC, as well as outsized portions of revenue and value created by users. For perspective, Roblox has a current market cap around 25 billion (went as high as ~65 billion last year 📉) and ~1200 employees. There are 500 million user creating on the platform, of which 1.3 million (~0.026%) are generating some form of income in Robux (Roblox’s in-world currency; see the developer economy breakdown of Roblox). The starving artist stereotype is still a reality for many. 😞
In Web3, creators have tools to both monetize and retain ownership of their work, such as censorship-resistant cryptocurrencies and NFTs, which have unlocked new revenue streams on both primary and secondary sales. With greater financial freedom, creators have more opportunities to create their own projects, selectively collaborate, and most importantly, own work they more likely want to create, vs. selling their time as conduits to other people’s brands and personas that they may not be creatively-aligned with.
We have also seen creators connect directly with their collectors (da Vincis 🎨 to their de Medicis 🎩, if you will) via NFTs, significantly limiting the value and control extracted by middleware. Fun fact: did you know you can even chat directly with the NFT creator on Etherscan.io via their Ethereum address? 💬
The internet opened up access to information for the world; the blockchain will give all users the ability to create and own digital assets of value. The coming digital Renaissance will dwarf all others, as we will have orders of magnitude more participants from more places involved. The line between audience and creator; maker and taker, will blur substantially, both at the individual and the brand level. As more of our work lives take place connected in the Metaverse, it will lead to more collaboration as prosumers. 🤝
Why You Need to Build a Metaverse “Brand”
We are in a transitionary phase from Web 2.0➡Web3. The appetite for content is rising. 🚀 More niche communities are emerging online, immersive technology is quickly going mainstream (see the tweet above), and automation is making many menial jobs obsolete. Our work lives are transforming from having a single employer for life, to being employed by several companies over a career, and for many of us moving forward, into a growing entrepreneurial and/or gig economy.
Our attention and consumption habits are also changing. Owning and maintaining your authentic virtual identity; your individual brand, will go way beyond setting up your social media profile. As big Web 2.0 brands like Meta (formerly Facebook) already start allocating their resources to where users will be in the future, so too must we. 💯
Forming new relationships and building communities online was established by social media on Web 2.0. No longer were our friends and colleagues restricted to our physical locations, which greatly democratized opportunities to connect and grow globally together. The pandemic accelerated these trends, de-stigmatizing social perception of time spent in virtual experiences, such as gaming and online meetups. As digital immersion and the creator-driven Web3 ecosystem continue to go mainstream, it’s incredible how much richer our online social lives could be in the Metaverse.
Today, Metaverse primitives, such as NFT collectibles, are already being used as online status symbols, and the more of our attention, time, and identity is tied to the Metaverse, the more valuable such digital assets will become. At least, that is the thesis behind a lot of the money entering the Web3 ecosystem, both at the retail and the institutional level. 🤑
Institutional Investment in Web3 Is Rising 📈
NFTs are simply the next iteration of monetizing attention, just as television and social media did so in the past. 😎
Backed by cold, hard data, many investment analysts and funds, including ARK, Real Vision, Stripe, Greyscale Investments, a16z, Sfermion, and Outlier Ventures, are going all-in on Metaverse trends like gamified finance (“GameFi”). There is a massive wealth transfer taking place, not to mention an emigration of talent across several sectors, including tech and finance. What began just over a decade ago with cryptocurrencies like Bitcoin (even earlier if you trace the Cypherpunk movement 👨💻) is now swaying culture and influencing generational habits. Placing greater attention, time, and value to natively digital experiences and assets has become the norm.
Never financial advice, of course, but when big money talks, I’ll hear them out. When they back their words with their money, I’ll tend to listen. 👂 For further reading, check out John Egan’s articles on Medium (CEO of L’Atelier Ventures)
Continuing on the prosumer thesis, note that many prominent thought investors and financial thought leaders (Ray Dalio, Raoul Pal, etc.) are avid content creators themselves - they are active on social media, engage with their communities, and are creating a unique brand for themselves that will follow them into the Metaverse. The value of social capital becoming synonymous with financial capital, and could very well become the truest form of currency in the Metaverse with social tokens and NFTs.
This is why it’s so important for all creators, whether you consider yourself one yet or not, to take ownership of our identities and get used to sharing the narrative we wish to express about ourselves virtually asap. Such skills are steadily becoming required in Web 2.0 (LinkedIn, Twitter, TikTok, YouTube, etc.), but they will become nearly essential in the virtual worlds that make up the Metaverse ecosystem (Meta Horizons, Nvidia Omniverse, Roblox, The Sandbox, Decentraland, ???).
Own Your Identity in the Metaverse
In Web 2.0, we rent our profiles and pay with our privacy. Just because something’s familiar, doesn’t make it right. 🔥
Bodily integrity and physical property rights were foundational to the growth of nation states, and digital personal and property rights secured by blockchain technology will be foundational to establishing virtual worlds in the Metaverse. Only when users take full ownership and agency of their assets, can thriving economies and equitable societies emerge. In other words, if you don’t take control of your digital assets, someone else will.
Think twice before building your house on a foundation of sand (especially when that sand is owned by small group of robber barons 🎩).
Setting Up Shop in Web 2.0 vs. Web3
Communities of Web3 users empowered by NFT ownership will be able to participate in the long-term growth of organizations and brands together. As creators and consumers in the Metaverse, we will all be storytellers. For brands, people will be invited to take part in real-time narratives that become a part of them, in which all stakeholders play an active ongoing role.
When people buy into NFT clubs like Bored Ape Yacht Club, they’re aping in, not specifically for the art (although that does play into the emotional connection many NFT owners have with their collections), but for the social currency factor. The value of the whole BAYC brand goes up as celebrities like Jimmy Fallon and Steph Curry join the community, which further drives more attention and demand towards the brand. 🔁 In projects like BAYC, NFT holders actually have the (previously unheard of) rights to commercialize their NFTs for profit, making it possible to build your own brand on an existing popular NFT brand! Check out what the owner of BAYC 1798, a.k.a. "Jenkins the Valet" 🍌, did last year with their media deal with Creative Artists Agency (CAA), a global talent representation agency that boasts some of the biggest names in entertainment!
“In Web3, not only do the creators get ownership of their work, but so do the fans. Now, creators can transform their images, songs, and videos into NFTs, and continue to provide NFT owners with a share of any profits made from the underlying content.”
- Bankless article
I’ll say it again, but successful Web3 creators and teams are building from the bottom-up with their communities.
Revenue will (ideally) go to supporting developers and creators who contribute to and actively use the platform itself, vs. going disproportionately to early financiers (who may not even use the platform themselves).
With more users participating in a brand’s economic ecosystem together, a virtuous cycle can take place - wealth is earned and spent by many (not hoarded or taken out of the system), which attracts more users, which creates more demand for goods and services on the platform.
For incumbents entering the space, like Nike who acquired Web3-native Metaverse fashion brand, RTFKT, investing in and/or partnering with NFT-native projects that have already built a community of true fans and users makes more sense vs. throwing money at prototypes and pitch decks of dreamers.
Blockchain Gives You an Unfair Advantage ⚖
“…blockchain could not be looked at in isolation because it represented…a new open economic system that would enable, and be convergent with, other technology trends. It would fundamentally change the business model of The Web and bleed into almost every industry…”
-Jamie Burke, CEO/Founder of Outlier Ventures
By deploying NFT smart contracts themselves (effectively setting up a censorship-resistant storefront for eternity), creators not only dictate the terms of ownership of their own content, but are able to program the narrative, utility, and incentive structures they envision for their communities as well. Of course, creators can also customize how their revenue is handled automatically (secure escrow, royalties, revenue splits, etc.). 🏪
Ownership and governance by the users, for the users. Who better to make key decisions on a platform than the users themselves, especially if they have some shared ownership? If you’re a creator who opposes censorship and wealth disparity, a Metaverse built on decentralized networks like Ethereum should be more appealing than having a few Big Tech players in control. 🏛
Many NFT marketplaces are also community-owned (or are transitioning to be) via decentralized token structures and/or DAOs (decentralized autonomous organizations). Take SuperRare, for example, in which the community of artists and collectors were airdropped $RARE tokens, giving them authority to curate and make governance decisions over future development of the platform. When shareholders are active community members themselves, we begin to address issues such as voter apathy and flash bot arbitrage; issues rampant in conventional stock markets for publicly traded companies.
Cryptocurrency markets are borderless, and run 24/7. Integrating quick, accessible transactions with crypto (once a user is on-boarded) means that as user adoption continues to grow, brands and platforms that fail to adopt these payment rails will die with their user bases. For more business savvy creators, being able to borrow funds anytime via DeFi protocols without having to apply to a traditional bank is game-changing. 🏧
Real-time accounting data. No more scrambling to come up with quarterly reports or annual numbers, which can often be erroneous or even cooked! Say hello to fully transparent on-chain transaction records on-demand, at a fraction of the accounting overhead and headaches. 🧾
Prior to digital scarcity via NFTs, our perception of value was largely based on the world around us - the more copies of something existed, the more common and less desirable it was. By contrast in Web3, the more something goes viral and cements itself into Metaverse culture (as a meme), the more valuable proof of ownership of the original becomes. Users right-click-saving your NFTs = free marketing. 😎
My biggest concern over Metaverse worlds with centralized Web 2.0-like ownership models (Meta Horizon, anyone?) is that such systems do little to enable a creative middle class. Creators building a livelihood for themselves on a decentralized foundation: 👇
have greater access to valuable data, free of barriers such as permissioned usage and price fluctuations. As Web 2.0 social media platforms matured, countless web-based service businesses got wrecked overnight when Twitter and Instagram removed or throttled what data could be queried via APIs. Costs of API tiers can also be changed without notice, which can lead to uncertainty in budgeting. 👩💻
Art by renowned NFT artist, Alotta Money, whose untimely death recently shocked the NFT art community 🙏 are more anti-fragile. In cases where not just the data, but the infrastructure is decentralized, there is no central point of failure (i.e. if Facebook goes offline, causing your Instagram/WhatsApp side hustles to cease). 💪
are much more censorship-resistant. How many creators have built their reputation and presence on a single social media platform, only to have their accounts banned, see the platform fall into obscurity, or have a third party arbitrarily decide that their content is no longer suitable (algorithmic bias, political pressure, etc.). With NFTs, you can set up shop anywhere/everywhere and your audience will find you (you might even find new audiences in different metaverse worlds)! 💬
are less prone to theft and plagiarism. This may seem like a false statement, given the amount of FUD stories you might be seeing around NFTs today, but let me explain:
Because each NFT is unique, NFTs stolen from a compromised wallet can be verified and tracked, making them much harder to resell compared to physical stolen goods like art and cars. Always try to check the history of an NFT before purchasing on secondary markets. ⚠
In terms of plagiarism, reposts of NFT content effectively become bottom-up viral marketing campaigns, potentially adding value of the genuine NFT. 😎
can scale more quickly and organically - growing bottom-up with an established existing community is generally more effective than forcing a narrative on the market. 📈
“A platform is when the economic value of everybody that uses it exceeds the value of the company that creates it.”
-Chamath Palihapitiya, VC/CEO at Social Capital, paraphrasing Bill Gates
Tips for Building Your Metaverse Identity & Brand
It’s cliché, but be unique, genuine, and consistent in how you present your identity and “brand” yourself across various websites, social media platforms, and Metaverse worlds. 1️⃣
Research your audience, engage with them, and demonstrate that you understand their needs, interests, goals, and ambitions (and create compelling content based on this that aligns with your brand). Be sure to track where your audience is most active (both on Web 2.0 and Web3 - see the diagram below 👇). For example, it might not make sense to put as much time engaging a gaming community if you are trying to connect with art collectors.
Be transparent but selective/intentional about the content you publish, as well as other brands you associate/collaborate with. 💭
Build on core competencies from your legacy career, and leverage those skills to add value to your Metaverse projects, NFT communities, DAOs, open-source repos, etc. 🔧
Be flexible, but plan for long-term value, especially if you plan to utilize NFTs. Clearly state what the NFTs represent, including any creative rights, utility, roadmaps, etc. 📑
Be open and generous with your community. Rather than struggling to build alone, share your narrative and unlock the collective imagination together as prosumers. 🔁
Consider deploying your own custom NFT smart contracts vs. using shared storefronts like OpenSea’s community contract. NFTs minted on public contracts can result in weaker branding and less control over the distribution and creative control of your project. 🦾
Be a Renaissance
ManPerson
On a more personal/philosophical level, remember that your identity is dynamic. It is healthy to be constantly questioning and evolving one’s identity over time with newfound understanding, while staying true to one’s core ethics and values. 😊Further reading
With all the excitement and hype surrounding the Metaverse and Web3, it’s easy to get overwhelmed. As we venture forward into an uncertain future together, don’t feel pressured to build everything, everywhere, for everybody. Remember that Web3 and NFTs are just tools here to help empower you and other creators. ☝
Successful Web3 Brands & What They Did Right
RTFKT
A creator-driven Metaverse fashion brand built natively in Web3. Collaborating with NFT artists early like Fewocious got the word out, and led to partnering with companies like Atari, creating the CloneX Metaverse collection with Takashi Murakami, and ultimately getting acquired by Nike!Animoca Brands/ The Sandbox
Animoca is Hong Kong-based video game and venture capital company that pivoted entirely into Web3 and NFT games (and cost them their public listing in Australia). They recently held a valuation around $5B, and are significant investors in The Sandbox, a virtual world Metaverse platform built on blockchain tech. The Sandbox has partnered with notable celebrities like Snoop Dogg and brands like The Walking Dead.
Existing properties building on decentralized, open Web3 ecosystems, rather than creating their own walled gardens, will become expected. Sebastien Borger, co-founder of The Sandbox, recently addressed false rumors that Meta was looking to acquire the company, and reaffirmed the company’s commitment to decentralization, along with some shade for the Zuckerverse. 🔥Bored Apes, World of Women, Nouns, etc.
Honestly, there are many more NFT-native brands I could have included that are gaining traction outside the NFTs signing brand deals, and welcoming celebrities into their communities, but they’re all thriving thanks to similar qualities:ongoing, long-term value generation from the project team, with a roadmap guided and built together with the community.
shared value and ownership models, in which each holder has ranging IP rights over their specific NFT, from BAYC/WoW’s full commercial usage, to Nouns fully open-source IP (public domain CC0).
a tech stack built on decentralized blockchains like Ethereum.
Web3 Brands Facing Backlash from Users
Larva Labs
CryptoPunks, a free-to-mint experiment from 2017 created by the two-man team behind Larva Labs, was the OG blue-chip NFT project that started the whole collectible NFT PFP (profile pic) craze. However, unlike BAYC, the Larva Labs company retained all IP rights over the Punks brand (including each NFT). A prominent Punk holder recently sold their NFT for $10M, mainly over concerns about IP rights and future value creation plans by the Larva Labs team.OpenSea
The biggest NFT marketplace is no stranger to negative press. Front-running users, notoriously unreliable servers, and a recent contract migration PR disaster (with a phishing attack taking place amidst the confusion). Perhaps they grew too big, too fast, but when OpenSea announced potential IPO plans this year, it caused many users to seek out alternative NFT marketplaces, and resulted in the emergence of decentralized competitors, such as Looksrare. The key takeaway? Stay true to the shared community values that you’re building on.
Cool Web3 Projects
Render Network, Helium, IPFS, Arweave, Theta, and Livepeer are some notable decentralized internet infrastructure protocols that are already becoming foundational to an open Metaverse.
Sign-In with Ethereum, Crucible Network, Nametag, and Metakey are just a few projects in the Web3 identity and access management space.
Lens Protocol is a newly released framework from the same team behind DeFi giant AAVE. It is aiming to let users own their social graphs (i.e. social media networks) via NFTs.
The Awesome Metaverse is an exhaustive list on GitHub that tracks several projects and information resources on the Metaverse.
Enjin/Efinity, BlockPegnio, and Forte are some notable companies building NFT tools to support interoperability and security easily into blockchain game projects.
The Metaverse Is Yours to Create
Whatever you think the Metaverse will look like in the future, it probably won’t be that. 😅 I’ve heard the Metaverse described as “dissimilar but familiar,” which I really like. It speaks to the creativity we share as a species, how art shapes our views on reality, and changes over time. While early art reflected reality and depicted daily life, much of our lives today reflect our art. Works of fiction and the fantasy worlds we create will soon become realized in the Metaverse. 😲
A new middle class of creators is emerging; a golden age for those of us willing to embrace this opportunity as artists, writers, developers, entrepreneurs, or a multitude of other creative roles. I’ll add that even though we emphasized the importance of “branding” in this article, let’s make sure the Metaverse is built on the community values of Web3, and not the dystopian, overly corporatized vision of the Metaverse we see far too often.
“(The Metaverse:)…to foster a healthy sense of community, place and purpose; a means of enablement, not merely escape.”
- Mission Statement, Galaxy Interactive (subsidiary of Galaxy Digital)
In the next and final part of “The iNFiniTe Metaverse” series, get ready to get practical and actionable. We’ll go deep on how your work life will get disrupted by the Metaverse, what roles will be in demand, and how you can start preparing for the workforces and business opportunities of the Metaverse today!
As always, thank you so much for taking time to share this journey together with me into the world of NFTs. I hope you found the content helpful, and maybe even fun to read! 😁
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⚠ Disclaimer ⚠
Cryptocurrencies and NFTs are a speculative asset class. Be aware of the risks involved and know that you could lose money. Everything I share references an opinion and is for information and entertainment purposes only. It is not intended to be investment advice. Please consult a licensed professional before making any investment decision.