Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Yat Siu: Animoca Brands – From NFTs & Blockchain Gaming to the Open Metaverse

Episode Date: December 9, 2023

When it comes to NFTs and blockchain gaming, very few companies can rival with Animoca Brands’ early conviction, investment thesis and time horizon. They understood early on that community building and network effects are the core pillars for a true paradigm shift in gaming. However, culture and narratives transcend the boundaries of gaming, becoming social phenomena. Animoca’s latest undertaking, the Mocaverse, aims to unite communities in a truly open metaverse.We were joined by Yat Siu, chairman of Animoca Brands, to discuss the importance of digital culture in our modern-day lives and how NFT ownership unlocks community building in the open metaverse.Topics covered in this episode:Yat’s background and Animoca Brands’ interest in NFTsDigital culture & narrativesAnimoca Brands’ investment thesisBlockchain & NFT adoption by Web2 brandsFinancial inclusion & financial literacyOwnership & play-to-earn gaming: East vs. WestNFT use cases & IP rightsInteroperabilityDecentralisation & the value of ownershipMocaverse Long-term vision & the open metaverseEpisode links:Yat Siu on TwitterAnimoca Brands on TwitterSandbox on TwitterAxie Infinity on TwitterThis episode is hosted by Sebastien Couture. Show notes and listening options: epicenter.tv/525

Welcome to Epicenter. The show has talks about the technologies, projects, and people driving decentralization and the blockchain revolution. I'm Sebastian Kutuio. And today I'm very pleased to be speaking with Yatsu. He's the co-founder and chairman and Admoga brands. They're a game development studio and venture fund. They have helped incubate and have invested in some of the largest web three games and NFT brands. Yat is recognized as a really forward thinker when it comes to the impact of Web 3 on digital ownership, on culture, and on sort of the broader impact of Web 3 on the economy. And so I'm very happy to have him today and chat about a whole bunch of things,

including, of course, NFTs, the Metaverse, blockchain gaming, and a whole bunch of other spicy stuff. So, yeah, thanks for joining us today. It's a great pleasure. Wonderful to be here and look forward to having a spicy conversation, I guess. Well, I try to make it spicy once in a while, but also hopefully, I think like, you know, we were talking about this earlier. On Epicenter, we tend to cover a lot of infrastructure stuff.

I mean, all of us host here at Epicenter, like, have been in crypto for like, you know, eight or nine or ten years. And of course, you know, when you've been in the space so long and you've came up with Bitcoin and Ethereum, you sort of tend to to gravitate towards infrastructure. At least that's been the case for us. And so gaming and NFTs is something that we haven't covered a ton on the show. Like obviously we've talked about them. We've had some folks on.

But it's definitely one of the topics that maybe comes up every couple of months. Like we had a mutable on recently, but I can't remember before that like when we last talked about NFTs. So probably during the last cycle. But, you know, before we get started, like what sparked your interest in in NFTs? And, you know, at which point that Anamoca decide like we're going all in? in this interesting new technology and industry? Well, I mean, I think we got into the space really actively through, you know, CryptoKitties in 2017.

Our studio Fuel Power was actually involved in helping build a part of Cryptokities. And actually the co-founder of Fuel Powered ended up becoming the co-found, one of the co-founders of Daffar Labs. And that's sort of how that evolved. And we ended up becoming shareholders and, of course, publishers of Cryptokitties, you know, literally a month, and a half after they launched in Asia. So that's kind of how quickly we sort of went in the space. But I think the main lens as to why we're so fascinated with NFTs or its potential anyway at the time

was that it was really about the cultural power in these economies that have been built around, right? So when we think of sort of the classic way that you might think of an L1, L2, for instance, you know, we do have this lens that we think of them as like national economies of sorts. Like, you can measure them as a business. You measure them essentially as a sort of, you know, it's community values, community network. Essentially, it's almost like a nation state. And one of the things that you create more depth than any nation state,

if you think about the physical world, is culture, right? In fact, you know, we describe culture as the deepest TVL of any healthy economy, right? When you think about what we purchase in the real world, whether it's fashion, clothes, even the real estate, you know, cars, you know, most of what we're buying is actually not its utility. We don't buy a car just to take it from point A to point B. If we did, then we'd go for the cheapest possible car there is. But no, we buy Ferraris, we buy Lamborghini, we buy Rolls Royces, or buy Teslas because they have statements.

And the same goes for fashion items, whether it's broken bags or sort of expensive shoes or, you know, watches. I mean, who buys a Rolex to tell the time, really, right? So these are sort of the cultural investments we have in that space. And one of the biggest areas of culture investment in digital time that we spend time on is gaming. Gaming is a space that has over 3.2 billion people that play, which is basically of almost two-thirds of the world's internet. It is probably the cultural thing that we do online that has its own sort of new kind of meme framework and culture framework that is gaming native as a digitally native. It's also the larger as an industry in comparison to music. music and film, with over $200 billion of revenue in the gaming industry last year and this year will probably be larger.

This does not include anything related to Web 3, for instance. So these are sort of factors as to why we felt that it made sense because gamers themselves also already have a sense of digital ownership, even though they don't own anything. You ask a gamer who plays Fortnite and he has skins in Fortnite, he's not going to say, yeah, I read to those skins. It's great. It's like going to the tucks for my prom night. No, they think they own it, right? And when they own currency inside a game, virtual currency in this case, they think of it

as currency they own, which is not that far away from cryptocurrency, at least in terms of the concepts. So we focused on gaming, not just because of our own background as a gaming studio, but also because we felt gamers had a more natural path of adoption, which I think is playing out when you think about sort of what happened with X infinity in 21. or sandbox, for instance. And now basically, you know, when you think about on-chain activity, actually gaming is one of the biggest on-chain activities throughout, you know,

any chain for that matter. So I think we're seeing those patterns evolve in Web 3. Yeah, I think economists, you were talking about Rolexes and Ferraris and all, you know, economists, I think call these positional goods, you know, where I think that's the technical term for it. And there's a whole, there's a whole sketch by a sort of some, somewhat emerging French comedian where he goes to Switzerland and, you know, he goes and buys a Rolex to see about whether or not he feels better. And, uh, our, our French listeners will, will know what they're, what I'm talking about. It's quite funny. But yeah, but basically he sort of

like, like, talks about these positional goods. And I think NFTs, I always, when I saw this, I thought, like, like, NFTs. I mean, NFTs are about, you know, um, about an outward statement, right? I mean, you own an NFT, you put it on your like, PFP or whatever, or like, you own a skin in a game. And it's more of an outward statement about things that you identify with or ideas that you might identify with or a community that you might identify with. And I think that that's incredibly powerful. And we're talking before the show about how like a lot of people in Web 3, you know, don't get it. Right. Like there is, I think, like a divide in the blockchain industry where you have like a lot of people that are focusing on crypto infrastructure or defy, these sort of like financial primitives.

And then there's an entire other sector or part of the industry that's really, you know, behind this sort of. like wet three branding, gaming, NFTs, and gradients in between, mind you. But I think that the folks on the infrastructure side maybe don't understand this so well because their monoliths and avatars are the D5 protocols themselves, right? They're sort of associated, I think, like, very much to sort of like the culture behind and the memes behind the coins themselves rather than like the NFTs. Is that something that you've observed as well? Or like, how do you, how do you, you know, account for this divide?

Well, so first of all, don't think there's a huge difference. It's just a matter of how you understand the narrative in your own construct, because again, it comes down to culture. And so really, when we think about NFTs, we think about NFTs as a way in which it can encapsate culture in a deeper sense because of the fact that it is now unique in its nature. So the example I often give is wedding rings. You know, a wedding ring in itself could be argued to be quite fungible. Certainly when you go to a Tiffany store, every wedding ring is made the same way, way is exactly the same and has the same value. But the moment that ring goes into the ownership of you and your partner, it becomes non-fungible in nature.

It becomes something special. And it shares in the culture of only the two of you and maybe a small community that's around it. And that's really when we say non-fungible is what we mean. We don't necessarily mean that it has to be unique in the sense that it has to have a different coloration. That's obviously the more outward expression, like what we see with the random PFP generations of something like BORDAPs. but it isn't actually the true meaning, at least from a human perspective, of non-fungible.

You know, I think about the things that we collect in the physical world. We don't want to give up, maybe a tennis racket that we used to win an important tournament. Or if we climb on Everest, then we will stick to those clothes that we can. We don't throw them out

because they are entirely unique to our history or our legacy. Why do we care about things like ancestry? Why do we want to look at our history? Why are we inspired when we see a flag, right, of some nation or some stories? I mean, these actually, form our culture, it's who we are. But the construction of the story itself is the shared culture,

meaning that fungible tokens, when you think about things like, you know, and I don't mean just meme coins, I mean just even things like, you know, Ethereum or Bitcoin in and of itself, ownership of that is already a kind of culture, but it's not really as individual. It's more of a collective culture that is shared across the communities there. And maybe with the challenging thing that I think most people struggle with isn't the culture side. It's the fact that they don't think culture has value often. They think culture is hard to value versus, you know, versus, you know, something that is maybe like currencies or gold or infrastructure.

There is a utility behind it. And it's true the utilities is important. But when you think about us as people, and this is the part where I would say if you're, you know, maybe very technically focused and you don't care about what you wear, for instance. You know, that maybe. A lot of people that crypto don't, you know, they just, I guess, They just wear the teasers. Well, it depends.

I mean, you know, it's funny. I talk to some people and then they have this really fancy watch or they have this really expensive car, right? And you like, why did you buy that car? Oh, because it drives really fast. Sure. Like, you know, try that and, you know, why do people drop, you know, buy really fast cars in Hong Kong, which have really narrow streets and you can't really drive fast, right?

So you're making a statement about who you are. And it's, again, membership of a culture and of your own culture, for instance. And I think as people, this is really defining us, these stories, these narratives. And by the way, if we don't have them, we make them up in our own head. We start creating our own narratives in the absence of those that are shared by others. But we want to be able to be a member of something and share those stories. Sharing these stories in the vacuum isn't fun at all. It's not human.

So we want to share them. And I think in the initial days, the fungible token was one mechanism around that. But the non-fungible, I think, just creates a much deeper expression and a much more personalized expression, which is, I think, you know, why NFTs are so powerful. Yeah. I've retained from that that I'll have to let my wife know that her wedding ring is super special because it's non-fundable with any other wedding ring. So yeah, just maybe taking a step back here and focusing on Amoka a little bit. So what is the investment thesis of Anamoca and how is Annamoka different from how other typical investment funds operate? Well, so first of all,

the investment funds of Anamoka is different because it primarily, certainly historically, has come from balance sheet. So we didn't invest as a fund. We invested basically from, you know, corporate. That meant that basically we have, you know, we don't have a fund life cycle, meaning that we can hold things for the long term. And we also really made these investments in the past really about how we help build the sort of ecosystem and also how it hopefully plays out in the ecosystem that we're building. So for instance, when we, you know, made the early investments in OpenC, actually, you know, we, we had probably most of the trade volume in office that wasn't very big. You know, back in 2020 and 2019 of an open sea were probably, you know, the top NFT collections

back in the day. And we didn't want to build a own marketplace. We just thought it made sense to use them and have them focus on the expertise of marketplaces while we focus on building games, and have all the portfolio companies that were building games such as Axe Infinity, trade their NFTs on OpenC back in those days. So that's kind of what we were focused on. And so that's how we thought of it. But of course, as time went on, we felt that it was important to help see the ecosystem broadly, such that Anamoka has now over 450 investments in Web3 and growing,

because we see these network effects compound on themselves. So even if the project itself might not have the highest single returns, actually their existence in our ecosystem helps facilitate the growth of a dozen or two dozen other companies. And they all build network effects and then they help each other out because in Web 3, you have the ability to build on these networks in a permissionless manner. You don't need to have an API access. I can basically just launch my NFTs on OpenC and trade them pretty much from the game. or whether this is a sort of lending protocol, whatever, like it doesn't really need permission.

And so the fact that we can then make the direct connections helpful to perhaps, you know, feature it or do some marketing benefits. But from a technical standpoint, the integration is pretty much straightforward because of the fact that most of it can be done sort of through this permissionless nature that is on chain. So anyway, that is a, that sort of the thesis around sort of building and compounding these network effects on top of it, which is also one of the reasons. why we started sort of building out Mocha versus a way to help sort of, yeah, connect and unite these so that we have a better way in which we can help construct these network effects.

So Anamoka is thinking of the way of Web 3, like constructing almost like a nation. And so that means that we spend and invest in a manner where we think these network effects develop that way. So for instance, investing in guilds, we've done quite a few of them, isn't necessarily because we thought that each guild is going to be the biggest home run ever, but rather because we know that they would onboard Web3 gamers. They will educate them. They will tell them what to do and maybe share the value or sort of, you know,

by the goods that can be rented to the players as an example. And in so doing, training them about Web 3. So that's valuable because that means every other one of our games in the ecosystem. We've done over 140 games plus our own like Phantom Galaxies or Sandbox or Rec League or Gaming, for instance. And they benefit from the fact that these guilds exist in our ecosystem. because they help train and onboard them. So that's kind of how we think about our investment thesis, which is a bit different from traditional VCs,

which are obviously because they're a fund with third-party money, have to be very much more directly sort of returns-oriented. Plus, they have a life cycle, right? So timing matters to them. So, for instance, in the early days in 20, you know, we couldn't raise any money from traditional VCs in 2018, 2019. And most of the people, by the way, didn't disagree with our thesis. They didn't say, oh, Web3 Gaming isn't interesting,

or back then they call it NFT or blockchain gaming. They understood the thesis. They were just worried it was too early. And the reason why it mattered is because the fund lifecycle was maybe already five years in, and if the cycle is wrong, then they might be sitting on this investment for four years or five years, and there would be no exit, and they didn't have it on why they're at a loss, right? So timing really matters, which is why it often appears that funds are very momentum-oriented but in a way they almost have to

because the fund life cycles are limited. Yeah, interesting. And how has the bear market affected, say, Anamoka's investments over the last 12 to 18 months? I mean, I guess more like, yeah, something like 12 months. And, you know, has the thesis evolved as a result of the market downturn? Well, I think the thesis, if anything, has strengthened because of the fact that builders are going to build

in a bare market are the ones you really want to invest in. When you think about sort of from a vintage perspective, which ones were the companies that really made Anamoka well known were the ones that we invested in between 2018 and 2020. Those were Dapper Labs and Daxi Infinity and Wax and DeCentraland and Sandbox and OpenC, right? I mean, you know, and then later on Yuga Labs, I mean, these are the companies that define the space, right?

And we got that, you know, in the early or first stage rounds. And they basically are the ones that are sort of held. shape that first wave. And sort of in the bear market, you know, those opportunities come about because also the builders who believe in the space will build in this environment because it's not necessarily just about the money, right? In this case, they're sort of much more mission-oriented because frankly speaking, if it's about the money, you'll have pivoted to some other industry out there that seem more obvious to raise capital from, for instance. Whereas if you're a big believer in Web 3, you will basically continue to build in the space because you've,

you know, you're that passionate about it or, or you see the impact and purpose around whatever it is that you're building, right? So, so those are typically the best vintage. So while the quantum of companies we invested in is reduced, not because we necessarily don't want to make these investments, because it's just less of them that are good, right? We are still deployed capital and you see us make multiple investments, big and small. I mean, for instance, today, we just announced a participation in Tonin and becoming, you know, one of the largest validators, for instance, in that network. But also, you know, previously we like literally, you know,

days before we announced investment in another gaming project called Frakana, right? So we continue to invest in the space. We haven't really stopped. Cool. Well, yeah, I mean, as a as a first time fund manager, you know, raising in this market, I fully agree that now is like the best time to invest. You know, we're investing in infrastructure primitives along the, you know, the modular stack. interoperability primitives, things of that nature.

Not so much in gaming and NFTs for the moment, at least. But it really feels like, you know, we're going against the grain in terms of, you know, what people are telling us, right? You know, I got so many blank stares when I started raising the day after FDX collapsed. And so, you know, now we're very happy to be able to deploy currently. Think about all the projects that, you know, you would have invested in over the last 12 months, whether these are tokens or even live tokens, for instance. Even one of your big opportunities in the last 12 months

wasn't necessarily private investments, but public ones in the sense that you're already trading. And you would have had incredible returns if you did that. But you needed to have conviction in Web 3 to do it. If you didn't have conviction in Web 3, if you were like, I'm not sure about this, then it's hard. But if you knew that and you believed that this was something that was here to stay and the fundamentals are what they are,

then you know, you don't mind if it's one or two years of a bear because eventually it will come back. And that's exactly what we've seen. I mean, you know, even something as large and fundamental as Bitcoin has essentially doubled in value from its lows from, say, 12 or so months ago. Yeah, absolutely. So let's talk about me. You talked about Mokoveris.

And I'd like to maybe shift to NFTs here more specifically. And we'd love to, you know, understand like what is Mokiverse and what's the vision here? But first, I think one, thing I'm curious about is, you know, Anamoka has, I think, lots of connections with big brands and has sort of been a force to get brands to understand, you know, Web 3 and these concepts and adopt them. What kind of big brands are, you know, approaching NFTs, utilizing NFTs experimenting? Who are the early adopters and who are the most forward thinking when it comes to adopting Web 3?

Well, generally, I think the most forward-thinking brands that we've seen have been the luxury brands and the fashion brands, because in some ways, they probably understand virtual value the best. Right? You know, like when you actually buy a Bergen bag, you know, how much of that value is the materials or the pure utility or holding things in the bag? And the answer is, of course, nothing, right? That's not why you buy it, right?

So what you're buying is 90% virtual in its construction. And that is, you know, when you talk to them about the Metaverse, and you talk about sort of, you know, what's important and why people buy the things that they do, which is about culture and community, they get it. So that's one of the reasons why they were one of the first ones in the space and continue to be investing in that space. Whether it's land or NFTs and, you know, they buy bored apes, they decorate on them, they address the community, so they think they're quite forward,

which is one of the reasons why, for instance, in Europe, particularly France, especially Paris, has actually interesting enough, been a hotbed of NFD innovation. I mean, it's not just sandbox or sort of, there's Dogami or there's like many other companies are like, you know, the there wise life beyond. Like these studios all evolving out of France

because they understand that very, very well, for instance. Right. So that's kind of, those are the one type of brands. The other ones that's interesting has been sort of the financial services in Asia, right? For instance, you know, institutions like HSPC, Standard Chartered, DBS, you know, all of these sort of financial institutions and also real estate companies like New World and Sookai and all those guys have actually been very active in Web3

because they also understand the value of these things. Like in the case of, you know, for instance, like an HSPC, one of the reasons they would be building on Sandbox isn't because it looks like Minecraft and looks like a game or Metaverse, but it's because the average landowner in Sandbox has about half a million to a million dollars worth of assets that is visible on chain. So these are perfect private banking clients, right? And in some ways, it's not that different from, you know, basically, you know, opening up a shop in, you know, Fifth Avenue, for instance, or in Beverly Hills because you want to address that customer and that audience and reach out to them, right? So, you know, those are the type of, you know, early institutions that get it. And in Japan, for instance, you know, our investors and partners are groups like MUFG, which is one of the biggest banks in the world and Mitsui, right? And again, these are financial institutions.

They get it. And I think there's a correlation here as well. who understand financial systems well, also are ones who are more easily attuned to Web 3, whereas the type of brands and companies that are maybe not as oriented towards sort of, you know, the value of sort of things are less likely to be attuned to them

because of the fact that that's not their reach and also not their strategy and approach. And many of their natural customers might also not be that audience, right? So if your luxury brand, the kind of people who can afford, you know, a Rolex, for instance, or LVMH type of stuff, are more likely going to be people who are also more financially literate. And therefore, the connection between that and Web3 is much more natural.

You actually, you talked about Web3 and financial literacy in a talk recently. I saw a snippet of it on Twitter. I was wondering if you could expand on what you were trying to express there. So, I mean, the first point that we discovered in this sort of journey of Web 3 is that most of the world, is not financially literate. And the way that we define financial inclusion is you have a bank account and therefore you're financially included. Yes, you can get your paycheck. But what do you do?

Not very much. You get your paycheck and you spend it. How many people actually make investments or actually think about their capital or understand even compound interest? I mean, if they did, then they wouldn't be taking out, you know, credit cards with like crazy interest rates, for instance, and all that type of stuff, right? which is one of the reasons why, you know, I guess traditional finance continues to take advantage of people like that because they lack financial literacy, right?

It's one of the reasons why regulation has to exist in order to sort of control these type of predatory tactics that we see the traditional finance companies have done because they make money from it and get away with it. And, you know, I think the, you know, for you look in the U.S., the first time experience that most young people have on true finances is student debt. and it's a hot topic, obviously, but it's a problem because, you know, your first experience is essentially one of, you know,

indentured servitude, but basically taking a loan that you have to repay probably for the next decade or plus so before you can even begin to build your own financial portfolio, for example, right? And that's just not a great outcome. And it also ensures, you know, a setup that is really not very strong and it gives a sort of negative feeling towards finance and so this aspect of financial freedom becomes aspirational, which is kind of crazy if you think about it.

So the thing that we believe in is that if you can teach children, basically algebra and all sorts of math concepts, then you can certainly teach them about compound interest and financial systems. You don't need to understand complex derivatives. That's not what you need to know. But you need to have some financial awareness. And so we believe that it's entirely possible for our kids to basically build portfolios, small as they will be, so that by the time they go to college, even if they want to or need to, they'll have ways in which it's they maybe can pay for their studies or have a portfolio of their own,

and we'll understand what they're getting into as well as a result of all of this sort of financial stuff that's happening around them that they don't understand until much later in life. So we think that's a key skill that's needed. But you can't learn this in school, in part because the teachers are financially illiterate as well, right? They don't have portfolios. In fact, teachers are amongst some of the least paid people in the world.

And therefore, you know, they live basically paycheck by paycheck. Even if they knew something about financial literacy, they can't even experiment because the other thing about financial literacy is an appetite and an understanding of risk. And if your life is essentially living sort of hand-to-mouth type of thing, then risk is becoming like a luxury that you simply can't afford to do. So we have to sort of train and experiment with the younger age, with obviously not things of great value. we learn through games and to play anyway.

But now as the world has evolved from physical to digital play, I mean, we spend in many cases something like half of our time awake or even more in some cases online in one form or the other. So we can create essentially experiences where you learn about financial literacy that way, that it evolves us essentially as we get older. And in gaming, we're already dealing with virtual currency. We're already kind of dealing with sort of skins and some kind of goods. But right now in Web2 games, you're not allowed to trade.

you're not allowed to sell them. You're not allowed to create any financial value, small as it may be, because it's against the interest of those Web2 game studios. But in Web 3, you're free to do all of that. So in that environment, we believe that gaming, Web3 gaming, can actually bring in financial inclusion. As it has done, for instance, with Axi Infinity, back in 21 and 22, were millions of Filipinos who don't have any formal education,

don't understand anything about money, but were able to open a crypto wallet, and basically receive, trade, and spend and fund basically in crypto. And that just means that if they can do it, then it's accessible to the world. Yeah, there's an interesting kind of like parallel to an article I read recently. I forget who wrote the article, but I'd have to look for it. Anyway, but basically the article is sort of claimed that the zoomers and the generations to come after them

were going to be or you know we're demonstrating some amount of delusion about their actions in the real world because they grew up on the internet and because they grew up this is like paraphrasing here

but because they grew up in sort of like a virtual environment with no real repercussions a lot of them were sort of socially awkward and you know did things in the real world that you know we're not in their best interest or that sort of mirrored or echoed the types of behavior that they would

have online. And I thought it was interesting. I mean, I don't know if there's like any sort of real sort of research behind that. But I wonder here with the risk thing, right, with the, you know, financial literacy thing, you know, if you sort of, you grow up taking these sort of fake risks in a Web3 game or some sort of like digital environment, you know, are you more predisposed to then like taking, you know, unnecessary risks in the real world where the consequence is going be very different. I know this is sort of getting like deep and philosophical here, but. No, no, no.

It's a good point. But I think this is at the heart of many design questions when you think about designing games or experiences. And even when you think about designing financial systems in defy, for instance, that's a part of that, right? So first of all, I don't generally subscribe to that view because if that were true, then we take the view that we need to protect people from things of information or. financial literacy or whatever that may be, right? And I mean, I remember, so I'm, you know, I was,

I was there in the early internet in the early 90s. I was a compi-serve user in the 80s. And, you know, many of the arguments that were made at the time was around too much information is bad. We should basically limit access. People, you know, aren't smart enough. You know, they're going to abuse all of that, right? And, you know, basically, you know, these were incumbent sort of information monopolies that didn't like the idea that suddenly there could be user-generated content and that it could be citizen journalism and that there could be someone out there

who was not working for a newspaper or a magazine that suddenly had a voice, right? And that somehow seemed threatening. And the same was, by the way, true when YouTube came about. And then people said, there was no way that anyone was going to... Or the Goodenberg Press. Yeah, exactly, right?

Or the car. Yeah, exactly, right? I mean, so there's always that type of scenario where you have persistence because change is scary in some ways, but also it's disruptive. And I think the key point being is disruptive in which way. And I think, you know, broadly speaking,

anything that makes access more egalitarian, more democratic, we think is positive, right? Versus the opposite, meaning that if it is becoming more elitist or more control, that's negative. Because even though abuses will happen on a net basis, if more people have knowledge, it becomes more of an intulation of issues. For instance, if most of,

most of the world was financially literate, then the ability to perform financial crimes is very small. The reason why financial crimes is possible is because most people don't know what they're doing, right, or they get entitled. And so we need regulation for good reasons, because we need to protect people, because they truly don't know. But how do we define that? Well, net worth. Okay, but hold on, right? That means, in some ways, if I don't achieve that net worth, I never have the ability to get there in the first place. Therefore, how am I actually able to participate, right? So the system had good intentions, but I ended up having an effect them, you know, to protect them, had to find them a way to identify whether you were financially

literate or not, which isn't the same, right? You could be financial literate and not have a lot of money and therefore still be the right person to do that. I mean, you know, think about financial, you know, financial institutions. Every person who starts off as an analyst in one of the big banks didn't start off as a millionaire, right? They came fresh out of school. They probably have student debt. They have negative equity, right? And yet, you know, they got the opportunity to work there, right? So which means that we can take people who are not financially sort of, you know, successful and bring them into the world of financial success. And if most of the world had this, then we think it's more self-inoculating. And the same is true for information as well,

right? In the early days, we just simply believed what the newspaper wrote, right? And today, frankly speaking, we realize that newspapers are as biased as us, maybe even more so. And so we take a more nuanced perspective. And unfortunately, that hasn't been good for seeking truth. it has been confusing for people who always thought that maybe there was one source of truth. But now we realize that there's multiple sources and we need to take perspectives and we need to analyze and we need to

basically not take things for granted the way that we do. Right. So to me, I think of it as a net positive as long as it becomes more open and democratic. This kind of touches on another topic that I wanted to ask you, which is about, I think, like,

I think Web 3 games probably because of Axi Infinity were quite used in sort of like the Philippines, Southeast Asia. What is it that most people in the West fail to understand about these markets and the relationship with Web3 Gaming and NFTs? So I actually think that the West, in particular U.S., more so than even Europe, has taken a very negative view to NFTs because of the view they have on crypto. And more specifically, the view on capitalism. So the point is that there was a recent few study that showed that I think 60% of Americans under the age of 30 preferred socialism over capitalism.

This analysis would have come out, say, a decade or so ago in the US, that would have been impossible. But today, actually being anti-capitalist is a political platform. And, you know, I mean, party members in the US are basically campaigning against capitalism effectively. Maybe they don't say it in that way. but in effect, they are going to war against capitalism. You know, it's a, you know, billionaires are a fault in the system. You know, you know, working hard isn't really fair, right? Inherit wealth, you know, all these things are basically things that have become points of attack.

And for good reason, because over the last two decades or three decades or so, labor has basically underperformed greatly in comparison to capital. And unfortunately, those people who have not been in the capital class and have basically been in the labor class, which is still the majority of people in the world, like in America, for instance, they've basically been on a net basis are probably making less money

than their parents have. And that's basically unprecedented in the case of recent history and also means that people who don't have access to this money, then look at money as feudal themselves. It's like, that's unfair. Like, why do you have this, right? Whereas I remember when I first went with the US in the 90s,

even though it was a recession, It was still about sort of a meritocratic approach, which was like, if you work hard, you'll make it. Everyone just had this goal. And if you had success and you made money, then it was celebrated as, you know, self-made men or women or whatever that may be. That's kind of, that narrative doesn't really seem to exist anymore, right? And, you know, when I was basically stuck during COVID in California, I, you know, I began to understand this when I started seeing sort of the sentiment, you know, what was happening in San Francisco, for instance. I was stuck in the Bay Area. And this sort of incredible anti-sort of, you know,

sort of campaign against those that had had wealth or, you know, Silicon Valley, people even, you know, who are working in Silicon Valley companies. It wasn't even related to, you know, founders of these businesses. People really didn't like them because of the fact that, you know, they were wealthier and it seemed unfair to them. And so now you take this into the world of gaming, which is by its design, quite meritocratic in terms of skill. If you're a good gamer, you don't have to pay money to be a good gamer.

And then you introduce things like NFTs. The first reaction you have is, wait, does it mean that I need to suddenly pay thousands of dollars to enjoy my favorite game? Or even worse, if someone who spends thousands of dollars, does he mean he is better than me now in the game? Then he show things and present themselves in a way that I couldn't anymore. Whoa, whoa, whoa, whoa, whoa. That's something we just can't have, right?

And I think this is something that's not. just felt inside sort of the gamers themselves, but also in the studios that make games, because game designers and game developers themselves are kind of in the same category. Now, you go to Asia, for instance, the opposite is true, where people are excited. The biggest game studios and game companies in the world, I mean, outside of ourselves, like Square Enix or Sega and so on, they're all embracing Web3, and they're talking about tokenizing their game systems, and they're talking about NFTs and blockchain because they are excited about property.

And I think it has to do with the history of Asia as well. You think about a place like South Korea, which is one of the biggest gaming places in the world today, 12 or 13th largest GDP. 40 years ago, its GDP was smaller than North Korea.

It was one of the poorest countries in the world. And actually, that is true for most of the Southeast Asia. If you look at Indonesia, if you look at Philippines, if you look at all these places, these were, for the most part,

pretty desolate places. Philippines is a bit of an exception, but that's a different story. But anyway, China, for instance, also. you know, hundreds of millions of people lifted out of poverty over the last 40 years. So, you know, how is it possible? Property rights, basically, embracing capitalism, right? I mean, yes, you know, China may have the sort of communist mantle, but it's as, it's more, more capitalist than most of Europe in terms of, you know, when it comes to economics and business.

And so that embrace and people have benefited from that, have basically seen how, you know, that worked. And so they're excited about capitalism. And I sometimes joke about this, but it's somewhat true. The American dream seems to be more alive and well in Asia than it is in America itself. And so things like Web3, property rights, NFTs, land and sandbox, you know, these are things that actually excite them and they see the opportunity because in living memory, this has benefited them in the real world versus what they have experienced in the U.S. I think that kind of echoes the, you know, a lot of ways.

I mean, you grew up in Austria, right? And I'm here, I'm here in France. And I think there is this sort of like working class sentiment that, you know, at least in France, I'm not entirely sure about like Austria. I think this is kind of overlaps with Germany a little bit, although definitely. But like there is this working class sentiment that, you know, work is a burden. that merit like sort of like this anti-merocratic

kind of ideology that you know permeates through some you know some aspects some parts of society you know and I think that that in a lot of ways echoes in the sentiment that like crypto is not like a serious thing or that it's like

that it's a scam right it is like sort of downplaying this thing that is inherently meritocratic and And I sort of like see that all around me. And then I, you know, sort of wonder why, well, like, why the U.S.? I mean, I think in the U.S. is particularly like interesting how there's been this shift from like the Merocratic ideology to like this anti-capitalist sort of ideology.

So, I mean, I grew up in Austria in the 70s and 80s. And, you know, that was still the time when there was the Iron Curtain. So basically, you know, going from east to west. And my mom used to work in the eastern side of Germany in East Berlin. So when I would cross over to see her, you know, it was a totally different world. And I think it did shape my thinking around why capitalism is better, why we need property rights. Although back in the day when I was a kid, I didn't really think about it this way. But it certainly is a vivid memory that I have in terms of sort of the desolate environment that was, I mean, it was literally 1984 in East, in East Germany, for instance.

But the other thing is that, you know, in the socially democratic countries, meaning Germany and Austria, and maybe to a certain extent, France, I think France is a little bit different, but still shares much the same sentiment. You can't really talk about money in the same way. You know, like money is almost dirty to talk about money. You know, and then I went to the US and then everyone was like, money, money, right?

And look at my stuff that I bought. And I came to Hong Kong, and that was basically capitalism on steroids where it was, it was like everything was about money. And if you didn't have any, then you weren't worth nothing. And then you had the other side of the problem. which was the extreme side of what happens when you have sort of excess capitalism and where you basically sort of, you know, capitalism at all costs, right?

It didn't matter basically at what expense it was, right? So there was, you know, so that definitely shaped the thinking. But I think also when you look at Germany and Austria, and I think the American influence in the early days is that work and labor was considered good, right? I mean, it was pure. If you worked hard, that was how you identified yourself. and that was kind of the, really was the Protestant and eventually evangelical sort of perspective. Abit-Machshkheims actually came from, like, from Dieffernbach.

It was not the Nazis. I mean, they stole it. I mean, they stole a lot of things. But this sentence, you know, this philosophy came from the Protestant philosophy, right? And of like, work sets you free. Work makes you a better person. And so, you know, a lot of people confuse that. But, yeah.

No, absolutely. And it was sort of this, I guess, the original. sort of Martin Lutheran perspective, which then, you know, because of the first wave of immigrants, basically you went from Europe to the U.S. were basically very Protestant or, I guess, evangelical in nature. And so they brought that work culture with them. And it worked for them as well because it was a new land. It was a new opportunity. And you had to work hard. And sacrifices were made. But also because everyone started almost at the same ground zero. So you didn't have the issues of inherited wealth. You didn't have the issues. of, you know, a king or queen or royalty that basically sort of had structures around limiting

your success and these monopolies that were established, right? And so that worked for a while. But of course, you know, in the U.S., in the last 20, 30 years, you know, inadvertently, partially because of the inflation of money, right, and partially because of the economics involved and, you know, money and because of the way that inheritance works and so on, money became feudal in its own way. If you had money, you would make more money. If you had money, you could get to better universities. You could get access to better education. And suddenly this whole meritocratic idea was destroyed because it's like, wait, I can't get

into that school, even though I seem to be pretty smart. Working hard doesn't give me that effort. And that's really, I think, kind of what America is searching for. I think the battle of America's soul is kind of based a little bit on that over the last sort of, you know, I would say decade in American politics which I think is impacting as a result sort of the perspectives

on crypto and Web 3. You can kind of see that from the perspective of the Democratic versus the Republican Party where their battle lines are being formed. Absolutely. I mean, we've kind of departed here from the topic of NFTs, but this is really interesting.

Let's maybe really back in. What are some of the other use cases for NFTs that you're really excited about. I think everybody knows about the PFs and, you know, like gaming skins and maybe to some extent some financial applications like using NFTs and, you know, to represent liquidity positions or even, you know, domain names in the case of an A VNS. But what are some of the, like, in the next cycle, what are going to be like the hot, like the really interesting NFT use cases that you're most interested in and that Anamoka is investing in? So, I mean, first, I mean, gaming apps, applications are obviously the utility side.

But the one thing that we think is really important when it comes to NFTs is you can't not marry and include the financial aspect of NFTs in and of itself, right? Even if it's not intrinsic, you know, and before it was just in the trading patterns. But now, basically, you can actually really have it as a way in which you can share ownership in things on an individual basis. So, for instance, I have two examples. One of them is in games and the other one is in education, which we're really excited about. and that's something we're really pushing with open campus and tiny tap. But let me first talk about the gaming example. In Rec League, for instance, if you're basically owning the NFTs,

then if a Web 2 gamer plays the game, he doesn't have to buy the NFT, but he can rent them, which is effectively what they do in all the games. He may think of it as buying the skin, but effectively he's renting it. The owner of the original NFT of that design now receives a revenue share directly because it's his NFT, right? And that actually creates a nice blend between the Web 3 and the Web 2 gamer, they can still enjoy the game, but they have different ways in which they interact with that financial layer, show you say, right? Because the Web 2 gamer men only want to

pay a dollar or two to enjoy the experience. He doesn't want to buy and own something. And that's okay, right? Same people, why people rent a house versus buy a house, for instance, or rent a car versus buy a car for instance, right? So I think the new Web 3 games that are coming out are more elegantly sort of marrying the blend between that two. And I think, you know, in 24, we're going to see some very interesting developments, because many of these games are about to come out, for instance. And then the other area, which I'm really excited about this, what's happening in education, you know, for instance,

with, you know, most recently we just did another batch of sales of what we called publisher NFTs. And publisher NFTs are NFTs that teachers created to create learning content. It could be like English, Spanish, whatever courses. And these courses are currently being rented, essentially, or sold in places like Tiny Tap. And they earn a yield, right? you know, they might make $10 or $50 or $100 a year. It's paid for by parents or teachers who then give it to their kids, right?

Think of it as a kind of Coursera or a sort of, you know, YouTube learning program where you pay a subscription fee and whoever makes a content gets a fee for that. But now when you own the NFT of that course content, you now own basically the revenue stream from that. You also can promote it so you can make it more famous if you want or more desirable or improve on it and maybe make more revenue. It's yours now. But the point is that a teacher is now able to create their own yield instrument.

And one of the problems is that before selling on these type of intellectual property assets wasn't possible or feasible because the cost of doing so was very high. So unless it made at least tens, if not hundreds of thousands of dollars a year, you wouldn't be able to sell it onto someone because the cost of the lawyer or the contract rights and whatever that you needed to do in negotiation was just too lengthy. So you just couldn't do it. But that's a problem for, for instance, places like Venezuela or Philippines, where teachers might only make $10 or $20 a month

and where whatever content they create might only generate an additional $10 or $20 a year. So that's nice add-on income, but it's not going to be life-changing. But now I can buy that same content, maybe for $50 or $100, and in so doing, I get a 20% yield. But the teacher basically makes half a year of the salary. And that becomes life-changing and that changes. And of course, what happens when we did that is that the teachers then start to make more content

and start to create businesses around it. And that's basically what happens when you have property rights and intellectual property protection, right? You can build foundations of businesses on top of it. I mean, if you didn't have property rights in the democratic institutions that we live in today, if America didn't have property rights, then you wouldn't have businesses

and you wouldn't have mortgages and banking facilities and a way in which you can have capital formation, which is basically now possible with NFT. that can be represented because through a transaction of less than a dollar, I can have the contract rights, the IP rights, the finance, where the money goes, everything done in one single transaction and I don't need a lawyer, I don't need all that kind of stuff, to be able to sort of do that.

And I think this is really powerful, not just for developing countries, but also for any other place for other time of assets that you want to sell or offer, and opens up intellectual property rights management to every segment of content creation. So for instance, even with something like dance fight, dancers are not able to immortalize their moves as NFCs. And again, that sounds whimsical and silly and stupid. You might say, why would you do that?

But these dancers have had their moves ripped off by big games like in Fortnite, who basically turned them into emotes and emojis. And they don't give credit to the creators because they had no way of basically in sort of demonstrating that they were the creators of this. And again, NFTs can solve that. many cool use cases that are evolving and many more that we haven't even imagined that I think will sort of really create space in the culture and entertainment and education space. You know, in the kind of Web 3 Infra, like crypto info, we've seen like this modularization

of the stack and also at the modularization of the application level. Is this also happening in the NFD space? I mean, it sounds like it, right, from what you're describing, right? Like how does that like overlap? Well, I mean, what happens is that we describe. It's described it generally as interoperability, but really what happens is that owning an NFT or NFTs makes you the owner and the NFTs themselves platforms, meaning that companies and businesses are now building experiences, stacks, or even new chains on top of the ownership

of essentially the NFTs in question because they become targeted audiences and customers. Like an example I gave about people who are interested in sandboxes because they want to address the customers of Sandbox. Or for instance, if you want to build something for people who own board apes, they don't do it because they just love board apes, but because the board apes represent a community of very high-networked individuals. Or, for instance, one of the Web3 games, which is also part of our portfolio called Pixels is becoming very successful. But we built on Ronan. And Ronan is a chain, which is basically supported by the guys behind Axin infinity, Skyamabas. And why did that sort of a take off?

because people on Ronan were gamers on Axi Infinity, and so it was natural for them to basically play another game, you know, within the network, because they had already amassed network effects of that effect. So the thing is that, you know, the culture layer, as it were, represented through NFTs, allows basically people to then compose all sorts of brand-new experiences on top because it's on-chain.

That's exactly the beautiful part about it, and it's permissionless nature. I mean, there could be vampire attacks, but the reality is that it's of value to the owner, right? If I own this NFT, then I receive potentially valuable experiences because people will build to reach me as supposed to, I have to go somewhere and seek permission, you know, to have access, right? I mean, today in Web 2 games, if Apple or Steam doesn't like you, then forget it.

You don't exist, for instance, right? You don't have a way for gamers to reach out to you, for instance, properly, because they are the gatekeepers. And here essentially, you know, it's decentralized down to the point to the end user. Yeah, that makes sense. You think that met the, that Web3 games and, you know, this concept of the metaverse,

do you think that the value here is decentralization in the long term, right? Because like having a fully, like building a powerful brand or a powerful IP or even leveraging existing IP, costs a lot of money and requires a lot of funding. And is the value here that these networks are truly decentralized or that we have record of ownership and sort of audit trail of ownership? Is the censorship-resistant aspect here as important as, say, with financial assets or like more fungible assets?

So one of the things that we love about the space is the irony in the way that in some ways, the more you give up control, the more value is retained in the network and the community. So perhaps the best parallel I could say is that if Bitcoin happened to be, you know, if there happened to be a set of miners that basically controlled the hash rate of Bitcoin, for instance, what would the value of Bitcoin be at that moment? it would basically sink down to probably almost zero because it would be so heavily compromised and nobody would trust it the same way, right?

And so there's a lot of reasons why people don't want to see that happen. And in a way, maintaining its decentralization is retaining your self-interest. And that's actually, I would say, very true in sort of what you talk about L2 and L1s as well, in the early constructions and also in the game systems that are out there.

Because it's early, it is often working on the premise of the promise. But if the promise is broken or is something you don't have faith in, then you move on to the other one that actually says they'll do that for you. And so again, you know, Ethereum, for instance, is, you know, even though it has expensive gas and, you know, it's not, you know, the most efficient, the fact that it is so decentralized is actually one of the main reasons why, you know, most of the volume and most of the valuable assets exist on Ethereum,

because you know it's the one network that is hardest to compromise. Whereas there's examples of many other, you know, L2s, for instance, that are arguably much cheaper, much more efficient, but yet don't have the same traction, despite its technical efficiency, because they haven't captured sort of the cultural aspect of it, which is the trust of the network, which comes from decentralization,

but also from, you know, the way that they've built communities around it. And if the community can't have a sense of ownership, then actually they, you know, because, you know, they don't have control over it, so as it were, then they start to, it compromises the trust in the network, which, by the way, is the same as it runs for nations and governments and countries as well, right? I mean, you know, I live in Hong Kong and, you know, China is an extremely well-run country. I mean, you know, if you've experienced it, things are efficient. Stuff gets done much faster than in the U.S., right? You know, you can build railways and train stations and stuff, you know,

with no fuss. And yet there's a liquidity discount in businesses and companies in China. And why is that? It's because there is a perceived centralization risk. And we've seen that effect. If China wants to make a change, they can make that change in good and bad ways, right, in a very top-down manner. And many people in China have been affected by that. And while prior to COVID, a lot of people were lauding the fact that China was really efficient in everything they did. And many, you know, people in the U.S. were saying, hey, you know, it's just much more efficient this way. We should just all go towards that kind of setup. And then, you know, when the decision was flipped the other way, it's like, oh, hold on a second, wait a second. We're not sure about that, right? Whereas in the U.S.

it's chaotic. It's the other way around. If you want to make a change, it takes forever to get that change. And you have to go through voting and you have to go through institutions and you have to lobby and it may never happen, but that means that your property rights in that sense is secure, right? You know, that if someone wanted to be chain making a fundamental change to the ownership of your things, you know, outside of you doing illegal stuff, obviously, then it requires such a major constitutional change that most of the country has to agree, which probably won't happen, right? And therefore, you have a premium for that, right? So I think the same principles apply in blockchain, obviously because it's young,

And, you know, the markets are still early in development. You know, you have these early developmental cycle issues. So you have, you know, you know, price imbalances and you have sort of, you know, these things that happen when when projects emerge. And, you know, because of the speculative nature, because capitalism is heavily embedded in Web 3, you also have people who participate in ways that might not seem logical because, you know, because of greed, for instance, right? That's, however, indistinct from the long-term value. So these might be short-term issues, but these aren't the ones that build long-term value. Long-term value are the ones that embrace decentralization, which means also gaming projects, if they want to succeed with a long term, have to be the same place.

NFT collections, by definition, are decentralized. I mean, if you end up maintaining 80% of the supply of your NFTs, it'll have a very different feel that when the community owns a majority of the NFC collection and has a right over. Very interesting points. Yeah, I think this, this sort of like premium for decentralization, even when we're talking about in the eastern states, is a good way to look at, you know, economies of different countries or even different areas, right? I mean, you know, it's good to look at it. You know, we've got a couple more minutes here, and I do want to ask you a little bit about Mochaverse and some of the brands that Anna Mocha.

has in his portfolio. Yeah, what is the Mocaverse and what's interesting about this IP? I think Cool Cats also is one of the brands that in the portfolio. So I mean, Cool Cat is someone we invested in. It's kind of like similar to Bored Apes, but it's cats. And, you know, it's the internet. Who love everyone loves cats? You know, and it's, that to me is, you know, I guess a classic PFP.

We just did a partnership with them outside of the investment with, uh, whether Japan operation with AB, Anamoka Brands, or basically turning them into sort of, you know, I guess a manga brand as well in Japan and opening that up. So that should be pretty exciting. And that's really about the culture and community side of things. And so this brand actually has like a show. Like there's episodes and characters. It's going to have stuff. It's not there yet. Right. And so our partnership is basically helping them build up some cool developments. And which by the way is just another example of what you can do with with cool IP. And you know, just as a parallel, I would say, rarely, if ever, in my own history, have I seen, you know, major brands evolve the way

that they have with sort of influence and financial capacity, then those brands in Web3, right? If you look at Yuga Labs with board apes, if you look at cool cats, if you look at even our own Mochaverse, or if you look at sandbox or, you know, Azuki, for instance, right? Or, you know, Pachi Penguins and so on, right? I mean, these are all incredible projects that were non-existent brands, sometimes two, three years ago, and have now become brands that are maybe more influential than some long-standing brands out there, right? So that's, that sort of demonstrates the power of, you know, the power of sort of, you know, how Web3 community building and sort of capital formation can

give effect. Now, what is Mochaverse? Mochaverse is really a way for initially, we have an NFT collection as well that starts it off this way. And, you know, the Mocha ID is the next phase which we've started to launch, which is a way in which we create soulbound NFTs that essentially create a digital, decentralized digital identity. And I think the whole concept around this decentralized DID is that you have a way in which you can now address our community in a sort of permissionless manner that is also sort of, I guess, in some ways, verified. So one of the experiences we had, you know, as we launch games, we sometimes do KIC.

So because of an end of team, we did this with other deed, we did it with regular. League and a bunch of other games. And every time we do this, we have to re-KYC because the wallets get tossed around, right? So, for instance, in our most recent sale, I think something like 30 or 40,000 wallets in our allow list ended up in the hands of people that were not actually doing the KYC because you could trade your wallace. I mean, like, wait a second, that's an issue. So that's the first point. The second point is that, you know, it's costly to do KYC over and over again. And so if we end up having, again, with a sort of DID, you don't have to disclose who the person is,

but now you know that it's KYC. And so it means that I can do an NFT Mint or I can do something with them without actually necessarily having to re-KYC and pay money time and time again. So that's, again, something of valuable. And of course, we have with our 450 portfolio companies with the millions of users in that network

and the address-over space being actually in the hundreds of millions, we can now create a way in which we can sort of combine and connect essentially all of these users in the kind of, I guess, social network, not really saying social phi, but really in social network, where then third parties who are not necessarily part of Anymoca can now benefit from its network effects as well. Like, meaning if you're launching a game, you can use Mocha ID and the Mocaverse to launch that and access this community without actually necessarily having to be a portfolio company, for instance, right, which currently is quite manual. We launch, we do a partnership, we do announcements, we do that kind of stuff. And, you know, that's okay, but that actually ends up becoming quite tedious. Whereas now, you know, basically we can create essentially our own, I guess, we could call it like a quasi L2 of culture, or everyone who can participate in MoCAverse can now get the benefit of that. And the other thing that we've also done is we've added a governance layer.

So if you own the Mochaverse NFTs, you basically are able to vote on our treasuries. So the most famous example that we've done is with ape coin. So we have basically, you know, millions of ape coin that is basically with the Mochaverse community, which is decentralized the ownership of the NFTs. And they vote basically, you know, on our treasury or part of our treasury, what they, you know, what, what, what, what Bitcoin as, you know, from a doubt perspective, can or cannot do. And it's interesting in the beginning, obviously it was viewed a little bit sensitive because it's a separate community that has a say in ape coin.

But, you know, we thought that was better because it ended up bringing the two communities together. And now many sort of mochaverse holders have board apes and ape coin. And apecoin holders have mochaverse and they've become an integrated community as it kind of become a kind of super pack, if you will, for ape coin. And have ended up creating, you know, these interesting political structures that have become more inclusive and has grown in the ecosystem as a result, which is what we think will happen broadly across the board.

And for us, that's how we want our communities to grow. We have large token reserves and token balances, but we don't want to be the ones that are sort of voting on them. We want our community to basically have votes over them because it also teaches them about to space and gives them a sense of ownership, even if it's not economic. And that's basically giving them rights to our tokens from a governance standpoint. And that's how Moogover plays a role as well. So it's kind of almost like a Tao of Daos, if you will.

in its top level construction. It's a Dowdow. Cool. Well, I've got so many more questions that I didn't get a chance to go through, but this has been really fascinating. And I want to thank you so much for your time and your really thoughtful answers. Before we wrap up here,

what's the end game? I mean, you know, in five to ten years, what is this space going to look like? And maybe because I didn't use the Metaverse buzzword yet, I'm going to ask you this, like, how does the metaverse tie into the end game? You know, I think in the next couple of years, we're going to start seeing Apple Glass and Facebook glasses and, you know, all these sort of AAR devices. You know, does it tie into the end game? And, yeah, what's your sort of long-term view here?

So first, when we talk about the metaverse, specifically we mean the open mettaverse, we talk about digital property. rights as the foundation of that. And things like AR and VR and VR and screens and other great experiences are wonderful and that they enhance and deepen our experiences. But they're not the meaning of the metaverse itself. And I think this is a part where a lot of people get confused because, you know, you are already kind of in the metaverse when you're playing a game and having a VR Goggle doesn't actually make that experience sort of, you know, more fundamentally different. Yes, it's deeper as an experience. It's more immersive.

But ultimately, if you're not owning the things that you do in the metaverse, it's all meaningless anyway, right? So we think the foundation starts with property rights. And that's only possible in Web 3 in blockchain, right? Whether that is on this chain, that chain, that doesn't really matter. In fact, we believe in a multi-chain future. That's the other thing. And so when we think of the end game, what we believe in is that, you know,

because we spend so much time digitally, because of most of the value is constructed and built in a digital way, we think that the end we wouldn't call it an end game it's ever evolving but the way that we're advancing to I think it will sort of give us ownership in everything that we do online

so meaning the new social networks of the future the games that we play in the future the environments that we're online we through our participation become essentially owners of the network we become stakeholders which basically means to me that you know it's just a fairer form

of capitalism right which has gone kind of wrong with shareholder capitalism, where only a select few get to benefit from the benefits of something and everyone else is just there to be extracted from. Whereas in this kind of stakeholder capitalism, everyone basically, you know, through their contribution, gets to share in that. Because, you know, today, if I'm a user in Instagram, actually, I contribute value. I basically work for Instagram. I, you know, I bring my users there. I engage with them. But actually, what do I get is, you know, it's, it's, it's likes, which is basically the cheapest, zero value currency there is, right?

You know, which, you know, arguably we could say is probably the bigger scam out there because you're giving them a form of a zero value token that really doesn't mean anything. But it gives you the illusion that it's something of value. And the platforms are of benefit. But in this future network, you know, whether it's in games or whether it's in social networks, you basically accrue value in the networks that you help construct. Because after all, if there's no users in Instagram's value is zero. And that's why they're true for games and every single digital experience.

And so we think that really what will happen, and we think there'll be thousands and tens of thousands of these experiences, and we will have ownership in our various communities, big and small that we get to participate in. We will see a reshaping of capitalism. So meaning that I think this could be the way which capitalism is rescued from its narrative, where people say, wait, actually capitalism is this beneficial force. Because without capitalism, we won't have entrepreneurship.

We won't have innovation. We won't have the incentives. It's just gone a little bit off the rails. We used to have things like antitrust, which helped break up monopolies, which they become powerless in the data paradigm. And so Web 3 actually is a solution to that. And so, you know, sort of a thought experiment I sometimes give to people when they ask me to think about this more deeply, is to say, well, you know, why, for instance, isn't every Uber driver?

also not a shareholder in Uber. It doesn't make sense to me. But now, because of that, Uber in the future is going to have driverless cars. But the people who helped make Uber are the drivers. And now they're going to be basically pushed out of a job eventually with driverless cars because Uber doesn't really need them. And that is one of the reasons why there's so much frustration.

This, by the way, isn't only in the case of Uber. It's in the case for everything that's happening in the classroom. classic share-old capitalist framework. And I think in the web three, through tokenization effectively, you make everyone a stakeholder, big and small, right? Nobody said you had to have the same value or the same contribution, right? Capitalism doesn't work if everyone gets exactly the same, right? That's one of communism.

But through your effort and your work and your contribution to the network, you receive essentially something of value, right? Perhaps it's sort of a kind of different iteration of proof of work, although not, you know, obviously in sort of the blockchain narrative. But it is essentially, you know, if you think about the oldest forms of value in our capitalist economies, it was our work that we did and the proof of work that we performed in the physical way.

So I think that's basically the next step that we can sort of come back to in this future metaverse that's sort of building out in Web 3 in blockchain. Hot take, the future of crypto is proof of work. Yes. Let's end on that. Sure. Cool.

Well, yeah, thanks so much for coming on the podcast. It's been great chatting. And, yeah, hope we can do this at some other point. We didn't even talk about AI. We didn't really go in depth on gaming. Maybe I can get you on my other podcast. We could do another show there. A little bit more in depth on the gaming side.

But yeah, thanks again. And I look forward to changing soon. Thank you for having me. Thank you for joining us on this week's episode. We release new episodes every week. You can find and subscribe to the show on iTunes, Spotify, YouTube, SoundCloud, or wherever you listen to podcasts. And if you have a Google Home or Alexa device, you can tell it to listen to the latest episode of the Epicenter podcast. Go to epicenter.tv slash subscribe for a full list of places where you can watch and listen.

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