'Wanted' 100mm NFT Pioneers
Must have wallet. Digital horse optional. Land Available. Getting there is Half the Fun!
Stadium Gates Issue #9
Photo credit: Myself, man! Viva, Omnia 2022!!
Wen Next 100mm, Frens?
I’ve just returned from The Grammys weekend in Las Vegas, and I may never fully recover. Nearly nine million people watched The Grammys, which was an increase over last year and seems like a lot of people.
Big numbers tend to lack context for the human brain, because nine million does seem like a big number. If you had nine million dollars, or nine million cupcakes, or nine million cubic feet of water, then the number would be a large number for most of us (nine million tigers would be a lot of tigers). However, nine million is just 2.7% of the total U.S. population, which is pretty small. Nine million people watched The Grammys, and it’s the biggest celebration of music in North America. Said another way, only nine million people showed up to celebrate music’s success and its biggest night.
Well, 100 million definitely seems like a much bigger number, and we’re looking for “The Next 100 million” people to join the wave of users already engaged with crypto products and institutions. 100 million. It seems like a big number when we want to find another 100 million pioneers, but it’s only 2% of worldwide population of Internet users, which is 5 Billion! Two percent, well that is a small number and should be doable in short order. Let’s search for a truly big number, because that way we know how far we have to travel as pioneers.
Well, 2 Trillion must be a big number. Two trillion dollars seems like a lot of money to be committed to crypto. It must be a bubble or a scam. It has to end badly if so much money is committed to projects by “shadowy super coders” per Elizabeth Warren (she’s a Senator). The total marketcap of all cryptocurrency is two trillion dollars, approximately. The global annual GDP is $85T, which makes $2T a small number, again. It’s 2.3% of world GDP. Well, shit. We’re really early, aren’t we?
We’re even earlier than early…according to a few additional sources, the total value off all assets in the world is between $360T and ~$500T depending upon the source. I can verify (checks notes), $500T is a big number, therefore $2T of crypto at .004 of all worldwide assets is indeed a small number.
Ok, we’ve found our big number ($500T), and we know where we are ($2T) so let’s build a road to get there and invite another 100mm people to hit the road with us.
Where We’re Going, We Don’t Need Roads
I was texting with someone earlier tonight, someone who is quite successful; someone with a vanity license plate similar to “HODL” (I can’t make it up), and he said he was pretty unsure of how to even approach NFTs. After 13 years and 300 million crypto adopters, the NFT space is still mostly unknown, even by the most deeply adept crypto adopters.
I live NFTs everyday these days, and it seems as though I’ve developed a blind spot. “Everyone” gets it, right?” Well, I jumped into Dune Analytics to check the stats on NFT users, and I found some context I had failed to completely understand until today. I understood the industry numbers, but I had not contextualized them in relation to our big number ($500T). I slapped my forehead. We’re earlier than I had even thought, because the current numbers are indeed quite small to the big numbers.
By using Dune Analytics and a query from Richard Chen, we are able to view Opensea’s monthly active users. Opensea.io is the largest and most active NFT platform and was recently valued at $13B during its most recent capital raise. Their user base is about 500k monthly active users who participate in the buying and selling of NFTs. Here’s a bar graph that makes it real:
Let’s be clear: 500k is a small number of anything (except Tigers). 500k is about 6.25 minutes of vehicle traffic on American roads, and it’s also .0016% of the 300mm estimated worldwide population of crypto users. Even within crypto, NFTs are currently a small pool of participants, and this is a gooooooooood thing for you. You’re a pioneer, and if we’ve learned anything from ‘1883’ it’s that new settlements are established on the other side of wide open spaces by people who didn’t need roads to guide their way. (We, also, learned from 1883 to travel light, to not get shot by dirty arrows, and to be very selective when choosing your travel companions.) If you’re in crypto and NFTs today, you’re a pioneer, and being a pioneer means having to do pioneer things to realize pioneer rewards. That’s what it means to be early. We don’t need roads, but we need great travel companions, at least another 100mm of them.
9 Million Grammys Viewers
Back to the Grammys…
OneOf.com is the official Grammys NFT partner. We were able to bring on some of the best crypto artists to produce the first ever Grammys NFT collection, featuring three incredible crypto native artists, including ThankYouX, Emonee LaRussa, and Andrea Oshea.
As mentioned previously, I am the Vice President of Revenue for OneOf.com, and my responsibilities include the tokenomics for the business, among other revenuey things. Nothing I note here is financial advice. Please DYOR and work with a financial advisor.
The NFTs we created for the first-ever Grammys NFT collection is something I’m very proud of on behalf of the entire team. I had the opportunity to discuss our project with attendees and banter about the place within culture for NFTs in general. I came away with a very clear understanding that the artists know NFTs are ‘good’ for their projects, but they don’t know why.
Why Line Go Up?
The “why” is the key question, isn’t it? Without naming names, “Why the fuck do I need an NFT?” was the response from someone you’d probably know. Fair question. It was pretty much the same question from the aforementioned “Hodler” vanity license plate owner. Why, why, why will the line go up?
“Why the fuck do I need an NFT?” — famous person
First, let’s point out that the line doesn’t automatically go up. There has to be value tied to the NFT itself. It has to ‘do’ something. Don’t buy an NFT just to speculate within alternate asset classes. That’s not financial advice, but it seems like a truism that should end up on bathroom walls at some point. Speculate on the engagement of Pete and Kim. Speculate on the stars. Hell, even speculate on the ponies, but don’t buy NFTs because you want to make a quick buck, and don’t offer an NFT if it doesn’t include actual value.
Here are a few use cases for ‘why TF’ one would use/buy/create/offer NFTs:
(Many of these examples have regional regulations that you will want to research—AGAIN, DYOR)
You like the art and want to own it. (crazy idea that just might work)
It is a collectible, and that brings you joy. (Crypto Kitties)
It provides membership to a club or DAO.
It’s an access token for an event.
It’s a POAP (proof of attendance protocol).
It endows future value based upon a published roadmap.
It has utility, such as it gives you power to ‘do’ something.
It pays a royalty.
It is a fractional ownership of a tokenized asset, whether digital or real-world asset. (some muddy water here)
It rewards holders with gamified randomized value. (airdrops, digital or physical goods)
It’s an actual digital asset you may use, such as wearable fashion for gaming, or virtual land, or avatar.
Proof of provenance. You create a meme that goes viral…you want to prove you were the creative behind the work.
Governance, voting, curation.
It’s a play-to-earn token which compensates players for their activity within a game environment.
The holder earns an APY from the community. (muddy water, sers)
The artwork endows IP rights to holders to use for commercial purposes. (brand a restaurant, hoodie, mixed tape)
Let’s face it…some people want to speculate that the line will go up and to the right based upon hype cycles.
Identity is one of our greatest human needs, and NFTs allow us to be non-fungible humans online. PFP projects, ENS domain registrations, and wallets are part of our identify picture.
I’m missing some use cases without a doubt, but let’s call that a good start and move along.
But WFT is it Worth?
I couldn’t say. It’s a completely subjective evaluation based upon some inputs from the collector’s life experiences. Show me an NFT of Jason Varitek doing his job, and I’ll drop some ETH on it, because Varitek smashing A-Rod was a meaningful life experience for me and millions more like me. Sadly, this clip isn’t an NFT.
We are able to find some guidelines, so here are some tools as a starting point. These tools will help users research the current market for some of the better known NFT projects and communities.
NFT Picks and Shovels for The Pioneers
There are a number of tools and websites very similar to CryptoSlam. The below is a screen capture of their NFT all-time leaderboard collections for sales volume.
The tools are mostly similar with some variations of the interfaces. Here are a few more:
https://dappradar.com/nft/collections
https://nonfungible.com/market-tracker?segment=art&days=7
https://coinmarketcap.com/nft/collections/
I recently learned of this one below. I’m going to start using it a bit this week, so I thought I’d throw it in here as a flyer.
Finally, everyone should eventually become familiar with Messari.io
But, You Didn’t Answer My Question…WTF Are They Worth?
#Facts: even with the above, it’s still a narrow view of value based upon structured data pulled from publicly available data sources of historical sales. More to the point: it only attempts to report on value of art and collectibles on a few blockchains from know sales. Of the list of 18 use value drivers above, these tools only hit upon, perhaps, half a dozen from larger communities. Thousands, more likely millions, of communities will emerge to offer ever more targeted value through tokenization, so it’s going to be important to acquire some skills to evaluate NFT offerings.
One has to dig deeper. You have to pair intrinsic value and your personal assessment of values to make a good decision. Don’t buy artwork you don’t want to own forever; don’t join a club where you can’t add value; don’t risk crypto you can’t afford to lose; don’t ape, unless yolo IS the experience you’re going for with NFTs.
Let’s go back to big numbers to close this out: $500T. We can agree this is a big number, and we’ll agree that $2T is a small number relative to the total global asset value. When we tokenize an asset, we are taking existing value and portioning some part of the whole to the token. If the entire global asset value were a single token, that token would be worth $500T. If we created two tokens to represent the same, then each token would be worth $250T, etc., etc., until the entire sum of global assets were tokenized and represented clear intrinsic value.
If we take this simple exercise and apply it to any real-world example, we’re simply dividing intrinsic value by the total token supply. What does that mean? If an artist decides his/her time is worth $100 per hour, and they create 100 pieces of work which each required an hour to complete, then they would argue their piece is worth $100 plus materials costs (let’s say $20 per piece). That’s a totally reasonable argument if the market decides the quality justifies the price. The total value of that collection is now $120 x 100 units for $12,000 marketcap of the entire collection. Therefore, if your budget for an art piece is $150, and you buy this item for $120, you’re in the money. Let it rip.
But, what if someone pays $10,000 for one of the pieces and the price increases to $10,000 for each remaining piece? Should you spend $10,000 and hope it goes to $20,000? Maybe, maybe not. That decision is the difference between intrinsic value and speculation of market value, so if your personal value is greater than the delta, then maybe that makes sense to wrap it up and take it home. Your downside risk is the entire value paid for the piece, so you should really find a lot of personal value in the artwork to make the purchase. In the current NFT market, many are simply not considering the downside risk for purchases they don’t find personally valuable. Pay whatever value you’re gleeful to pay if the funds are illiquid for some time; otherwise, you’re overpaying. That’s how much it’s worth.
Just Give Me an Answer! Lolz..
I can’t. You have to figure it out for yourself. It’s worth its scrap value, plus whatever emotional value you put upon the piece. Everything else is speculation on market value.
Here are two examples as an exercise.
These are two NFTs from my personal collection. Each is from a massive brand and a large project. One NFT is the official Grammys NFT, and the other is from Nouns DAO, which frequently sells for 50-100 ETH. Let’s play a game and have you price each of these:
How much is this Noun worth? No cheating. Do you have a number? Good, let’s move on…
And, how about the Official Grammys NFT? It’s a still image of the full video NFT. Click through to see the video. It’s extremely cool, and The Grammys exceeded all expectations.
Full video here: https://www.youtube.com/shorts/TFe3-mtnZUU
What price did you put on each?
Ok, say it aloud. What are they worth in the market, and how much would you pay?
Remember, each is officially licensed, each is a minted NFT on the blockchain. The Noun is a 1/1, and the Grammy is a 1/many, and the art of each are top notch within their projects.
For me, personally, the Grammy NFT is worth a lot. I can’t even come up with a number that I’d sell it for, but it would have to be a meaningful number, perhaps a life-changing number.
On the other hand, the Noun doesn’t mean much to me, even though it’s from a well-respected project with big numbers applied to each Noun minted. It marks a point in time for me, but I’d let it go for a reasonable offer.
Truth be told, each was free. Whatever number you put on either was a totally fair number to you, but I received them simply by minting a free NFT for each project. Neither has a market value of significance at this time, and the Noun is just a toy and probably never will have value. I can see the Grammy becoming valuable, as it’s pretty rare in comparison to 9mm viewers, but I don’t think it’s going to sell for a meaningful number one day. I just like it for many reasons, so it’s priceless to me personally.
That’s Not Helpful…
It is, though. I can’t stress enough to do your own research (DYOR) and focus on areas of interest that add value to your life on a personal level. Don’t chase the trend if you want to be in the game of understanding value for NFTs. NFTs are a catalyst for culture and society to achieve more by becoming more, but they are also a new technology being adopted by pioneers on the crypto plains. Those who watched the entire ‘1883’ series recall that not many of the pioneers made it. We’ve evolved over the last 140 years and are organizing our wagon trains so that WAGMI (we’re all gonna make it) is the planned result, rather than a hopeful outcome.
The mission of the StadiumGates community is to ‘Bridge the Masses to Web3’, and the goal of OneOf.com is to bring the next 100mm non-crypto native fans to Web3.
100mm is a small number, but we have to take steps to make sure everyone makes it.
My goal with this newsletter was to offer some frameworks to consider value when purchasing your first, second, third, and 100th NFTs. I’m hoping to get some people (100mm) off the fence and into the exploration phase.
Here are two ways to acquire your first NFTs for free.
Nearly free Grammys NFT: https://music.oneof.com/nft/0ba74357-0451-4e4e-af8f-3adc6b7f3164/marketplace-auction
Thank you for reading.
I’m looking forward to the unknown and ambitious.