This Week in Startups - GETTR & social media moderation, NYT to acquire The Athletic + Axie Infinity's Jeff Zirlin on NFT gaming | E1354

Episode Date: January 7, 2022

00:00 Jason & Molly intro the show 02:25 GETTR get a bump in downloads after Joe Rogan joins 09:55 Dataiku - Create transparent, repeatable, and scalable AI and analytics programs. Visit https://dataiku.com to learn more. 11:00 The darker side of community on the internet 15:54 Jason's take on decentralized social media 18:38 Eight Sleep - Go to https://eightsleep.com/twist to check out the Pod Pro Cover and get $150 off at checkout! 20:11 The challenges of content moderation on social media 21:13 NYT reportedly buying The Athletic for $550M 30:30 Squarespace - Use offer code TWIST to save 10% off your first purchase of a website or domain at https://Squarespace.com/TWIST 32:15 Interview - Jeff "Jiho" Zirlin from Axie Infinity 40:11 How "play to earn" games actually work 53:33 How do balance stakeholders in the in-game economy 58:05 Renting Axies and how "guilds" work 1:03:42 Buying digital land Check out Axie Infinity: https://www.axieinfinity.com FOLLOW Jiho: https://twitter.com/jihoz_axie FOLLOW Jason: https://linktr.ee/calacanis FOLLOW Molly: https://twitter.com/mollywood

Okay, everybody, we've got a great episode of this week and startups for you today. We're going to talk about free speech on social media. Getter, the social news app for the right wing folks, is getting hundreds of thousands of downloads this week because Joe Rogan joined the platform and a bunch of his fans are over there. I create an account, Jason Calcanus over there, if you want to follow me. And it's the one year anniversary of the insurrection at the Capitol. And we have a pretty wide-ranging discussion about the challenges of running moderation on social media. media platforms at scale, including the decentralized ones that exist in the crypto space. Plus, Molly brings up ProPublica's investigation into Facebook's role in the January 6th,

riots, attacks, insurrection, whatever term you like to refer to it as. Because of course, it is officially, it is the one-year anniversary of that event. Though that is not our only topic of discussion. We also talk about the New York Times reportedly buying the athletic for $550 million and whether Disney may have missed the boat on that one. We also, Jason has a great interview with Gho Zerlin from Axi Infinity,

the largest NFT game. I, for one, was riveted by this conversation. They've had billions of dollars of NFT sales. And just trust me, your jaw is going to drop

when you hear how much people are paying just for one of the basically the little like fighter characters. And now we say at the same time, three, two, one, it's going to be a great episode. It's going to be a great episode. It's going to be a great episode.

Stick with it. That's my side off. Let's stick with it to see if it works. We're going to work on that. What do you mean? That was amazing. This week in startups is brought to you by Data Iku allows companies to leverage one central solution to design, deploy, and manage AI and analytics applications. Visit dataiku.com to learn more. Eighth sleep. Good sleep is the ultimate game changer. Now you can add the pod pro cover. to any mattress. Go to 8Sleep.com slash Twist to check out the Pod Pro cover and get $150 off at checkout. And Squarespace turned your idea into a new website. Go to Squarespace.com

slash twist for a free trial. When you're ready to launch, use offer code Twist to save 10% off your first purchase of a website or domain. We cannot not acknowledge the fact that it is January 6th Today, it's the one-year anniversary of the storming of the Capitol. And so our news story today is actually very much in the vein of a lot of the things that have happened since, which is examining, you know, how social media played into this, how this led to the, of course, very high-profile suspension and finally booting of Donald Trump, former President Donald Trump off of Twitter, and the various apps and kind of this pro-free speech social media movement that sprung up as a result. Parlor obviously is, you know,

essentially dead and gone since the capital insurrection when it was going to briefly be the Twitter alternative. Downloads, though, there is a new one of the Twitter-like social media app getter have spiked primarily because, and this probably happened to Spotify also, Joe Rogan joined the platform earlier this week. We teased this segment yesterday, but I have to be honest, today feels like a better day. A better day. to talk getter. Yeah, I actually signed up because I saw the Joe Rogan thing, and I always like to just have my account.

It is like using Twitter in year one. It is an incredibly light version of Twitter. It's an exact copy. And so when you make an exact copy like that for a portion of the audience, it's going to be a hard business to actually make work. and I think making the anti-censorship, making the censorship resistant Twitter is going to be very hard for them because you're going to get every maniac to go on there

to do something that makes you censor them. So they're going to literally stress test it. You're going to have the exact same problem that Parlor had immediately, which is like you instantly got legit terrorists, legit Nazis, legit child porn. Yes. And that was the end of that. Because once you run right into the law, you have to moderate your content.

Full stuff. Yeah. So what happens is if you basically say, I'm creating a space where no rules apply, which isn't exactly what they're saying, but like less rules apply, you're basically doing a dog whistle, you're flashing the red cape. to the bull and all of a sudden, just every maniac's going to come there and be like, you know, spreading some conspiracy theory or, you know, the Sandy Hook kids weren't actually murdered as a false flag. Like the Info Wars guy likes to say, which is just the most loathsome thing in the world. And then you basically inherit all the worst people in the world.

Now, I'm not saying Joe Rogan is the worst people in the world. I don't believe that. But when, whichever side you lean towards, you're going to get those people. So if you lean towards Bernie, you might get the communists, you know, who are left of him, who want to literally ban billionaires. And if you take Joe Rogan and Ben Shapiro, then you might get the crazy Alex Jones who are to the right of them. It's just whichever way you lean, there's going to be a group of people who are going to lean even further. And as our producer Justin points out in our group Slack, advertisers just love.

of that edgy content, right? You're sort of walking the line because advertisers like engagement. And that is why Facebook and YouTube have simultaneously gotten away with promoting very divisive content. And, you know, there was a big, I'm just going to point you to the story, a Washington Post and ProPublica collaboration that came out yesterday that looked really, maybe the day before the fourth, I think, really, really, really in-depth look at all of the ways that Facebook and Facebook groups undoubtedly. incubated the violence that happened on January 6th, so much so that, you know, NBC, Brandy Zedrosny from NBC News, she and Ben Collins have done incredible work on misinformation. They posted a story about all of the violence that was being plotted online in advance of January 6th. They posted this last year, like January 4th of last year.

And Brandy tweeted about it yesterday and said, you know, I almost didn't want to do this story because it just didn't feel like it was news. And then after the riot happened, then Facebook said like, oh, I don't think that was planned on Facebook. Cheryl Sandberg was out here, like, I don't think we had anything to do with that. I mean, it was obviously,

if Facebook was, if Facebook is the dominant platform, and it really allows this kind of speech, and they take a light hand or they had taken a light hand, they probably still do. Of course, that's going to be where it's going to be. So in their defense,

like if a bunch of people on Verizon phones are plotting in, you know, private groups and I message, you know, is it Apple's fault of Verizon? I don't know. If it's in Facebook and they see it, and that I guess is a question. I think they really pushed groups because they wanted to have the, let's say, edgy speech be for a smaller subset of people. They actually, I think at Facebook thought that was a solution. It actually is not a

solution because what you're doing is driving the bad speech underground. I have always been a fan of let these people have their speech so we at least know who they all. And where it is, yeah, exactly. And where they are and Facebook not only like buried the speech in groups so that it would be harder to see in public, which every researcher told them was a bad idea. They then recommended the groups to people who showed up on Facebook. So they'd be like, oh, hi. I see you came to Facebook and you searched for a company that turns classic cars into electric cars. Would you like to join this group plotting an insurrection to the capital?

That is how like, you know, this algorithm was. Here's the analogy. If YouTube, if you were watching Ben Shapiro on YouTube, and then you got like, I don't know, Milo Yianoplas who was banned or Alex Jones, who was also banned for YouTube, imagine YouTube. Imagine YouTube didn't ban those two. But they said, hey, by the way, if you like Ben Shapiro in his, you know, super far right position, which I'm fine with, by the way. I don't have a problem with Ben Shapiro necessarily.

I mean, the anti-trans stuff is a little bit weird. A little weird. A little. He's a little too obsessed with it as like kind of my point. You know, like some people who we knew when we were growing up were kind of like anti-gay. And then they came out 20 years later. It kind of feels a little like that to me, like a little weird. But putting that aside, our lives online just ended by the way.

You have to. Anyway, no, it was like a very big trend when I was growing up. No, no, I know. I mean because like now somebody is going to be like, did you hear that Jason suggested that Ben Shapiro is secretly trans? I don't think Ben Shapiro is trans. No, I don't know. I think he's a little too interested in trans for it to be an opinion. I think it's a little bit of an obsession for him.

And when I see somebody obsessed with it, I think they probably want to hang out with trans people and be friends with them. Right. You know, I think that's actually what it is. Instead of, yeah, yeah. Like, he should just go to like, I mean, he would, he, I think Ben Shapiro wants to be a guest judge on Rupall's Dragways. I think he secretly would love that. That's, did I go too far? No, honestly, I just, I have no idea because I have never listened to him.

And I'm just, I'm waiting for all of his stands to be like, what? The potential for positive change with AI is huge. But seeing that value is hard. AI driven growth is about organizational transformation, not just technology. And many businesses struggle with bringing AI initiatives to fruition. And that's where Data IQ comes in. Data IQ is the platform for everyday AI systemizing the use of data for exceptional business results. At its core, Data IQ allows companies to leverage one central solution to design, deploy, and manage AI and analytics applications.

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I would listen to Rachel Maddow and I would listen to Ben Shapiro and then I would try to triangulate in between what was actually. happening with the Russian investigation, all this stuff. Right. Putting it aside, imagine you're watching that Ben Shapiro. And then it says, oh, by the way, we have a group over here run by Milo Yiannopoulos and Alex Jones. Would you like to join it?

Would you like to join it? But their videos were not public. You had to join it. And let's say you had to be approved. So the people who are the mods looked at your history and what channels you subscribe to. And if you subscribe to Rachel Matto, they wouldn't let you in. But if you subscribe to these other, you know, more right viewpoints,

they would let you in. But that let you do is it's kind of like joining a country club where like all the members are a certain demographic and then you might hear jokes that are racist or whatever, right? That's kind of what Facebook did in their group's architecture. Yeah. Now, did they do it intentionally? I don't think so. I hope not.

I mean, I think they promoted the hell out of those, you know, you didn't have to. I think they did it for growth. And it happens on YouTube. Exactly. They did it for growth. And they wanted people to join these groups. And so they promoted them relentlessly. And then the fact is that they found out that a ton of their groups were basically hate speech,

you know, anti-vax and and plotting violence against, you know, the government to overthrow the results of a free and fair election. So like, yeah, but anyway. Capital attack is a great raw shock test of intellectual honesty, I think. Yeah. You know, I'm good friends with David Sachs. He's like my bestie. And he keeps calling this like an outing and not a big deal. And then when I press them on it, he's like, well, of course, if you beat up cops and you broke things, you should be prosecuted. And I'm like, well, wait, which is it? Are you like doing a Republican talking point that like they were staying within the, you know, stanchions? Like, some Republicans like, oh, you what, they were like walking through the stanchions. And I'm like,

I know. I'm sure there are people at the back of the line who this was just like a fun weekend at Bernie's. Like, it was like a crazy like going to, uh, you know, a music festival kind of experience. But the tip of the spear was an insurrection. It was a spear designed to find Vice President Pence and

attack him and to find Nancy Pelosi and to beat her. Like, I actually believe if they had found Nancy Pelosi, they would have beaten her and killed her. And if they found Mike Pence, they would have beaten and killed him. I mean, am I crazy? Because I watch them beat up cops and I watch them break the windows and I watch them grab any

weapon they could to beat police officers. If they'll beat police officers, what the heck you think they would have done if they found Pence or Pelosi or AOC or anybody? It's in, it's, look, it's all, it was all on TV in real time. Yes. It is all recorded. There is no argument about this. Yes. Whatsoever. Whatsoever. And the only question is, what's it going to look like as we move forward with these sort of increasingly splintering information biospheres. And so you see these apps that are an attempt to sort of further splinter that, whether they're going to work, I don't know. You see social platforms struggling with the concept of how to promote really engaging content that might be bad for society, but that isn't so offensive that advertisers pull out,

because, you know, advertisers were boycotting YouTube over terrorist content. So it's, I think, like, the simple the simplest thing to say here is that every platform that comes along like Getter and says, we're going to be the 100% free speech platform. And I take issue with that characterization because you know my belief is that censorship is a tool of governments, not private companies who can do whatever the hell they want with their platforms, particularly publicly traded companies that have a fiduciary responsibility to their shareholders and investors, not the people who are flapping their gums on their platforms, is going to run into the exact same problem over and over and over again.

There is no such thing as a totally unmoderated platform if that platform is a business. And there are crypto decentralized versions of Twitter that have been around for a while. And so MasterDon, I think, is the one. MasterDon is the Twitter competitor where you get onto any server and, you know, MasterDon. Dot social. And it's never taken off. But theoretically, if you were using Mastodon, you could be doxing people, threatening people anonymously.

And this is where nobody being in charge, which is a theme we were talking about this week in crypto projects, et cetera, and centralization versus decentralized. I mean, do we really want a world where nobody is in charge of an at-scale social network? like imagine do the do the thought experiment of facebook not being owned by anybody right and none of those rooms can be banned except by they can never be banned but you could have law enforcement go to them because they are coordinating attacks like january 6th or worse uh or like a sandy hook or you know any other like violent attack do we really want a censorship proof at scale social network i don't think i want to live in that world well nobody's It seems to be to be incredibly dangerous, and I'm a free speech advocate, but to not be able to take down, you know, child porn or threats of violence or doxing, that seems incredibly dangerous.

I mean, we're just seeing like smaller and smaller ripples of what the entire internet used to be, right? When the internet became the worldwide web and then it was a totally unmoderated, you know, completely wide open view of society. And then everybody was like, whoa, whoa, whoa, whoa, we need to create search engines for this. We need to create safer spaces within this. And we need to. And you start like, it started to get moderated. into more manageable chunks. And then those manageable trunks got out of control.

And they were like, whoa, you can't be doing that. And there are bulletin boards and our BBS groups. And we need to like put a filter here. And like this is just what it is unfortunately like, or fortunately a natural evolution of like a mirror on society into a version of society that we live in every day. Yeah. Except this is global and at scale. Right. instantaneous.

And moving fast. and there's philosophy. It grows at a pace that's different than, you know, I don't know, a Ku Klux Klan, you know, white supremacy group, you know, in the South. It might take them 10 years to grow to 100 members, whereas a group on Facebook could grow to 100 members in the first hour. And you can create 100,000 fake members overnight. Yeah.

So it's a, it's just not, it's not a one-to-one comparison, but like the real world to these social platforms. I mean, Reddit is a perfect example because they kind of took the, you. Usenet, the BBSs, and they became super toxic. And then they wanted to have advertisers to dovetail back to producer Justin's point in the chat while we're reading this. Like, it's going to be hard for, you know, Getter or any of these projects to have any kind of advertising outside of like Mr. Pillow, wherever that idiot is, who sells pillows and things, you know, that's, you know, Venezuelaans, you know, rigged the election. Yeah. Because, you know, they're so good at running countries.

And yeah. Yeah. Anyway. It still, it is one year later and remains a messy world, I think, is our takeaway here. Good sleep is the ultimate gain changer. We all know that, according to eight sleep, over 30% of Americans struggle with their sleep. And temperature is one of the main reasons. Don't I know it?

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You need only open your eyes and read what the right was saying and the left was saying, as per this article that you pointed out from ProPublica. We all knew this was a possibility. Tim Poole, who is like that, you know, right, I think he's an alt-right citizen journalist. He said in a conversation, and I'm just quoting from the Wikipedia here, I've had messages from people saying they've already got plans to rush to D.C. as soon as November 3rd goes chaotic. And that, the right-wing militias, the oathkeepers, the three-percenters, and just the proud boys and Trump supporters, they are going

to full rush, they're going to rush full speed to D.C. They are going to take the White House and do whatever they can and paramilitary. Facebook groups had 650,000 posts attacking the legitimacy of Joe Biden's victory between Election Day and the January 6th insurrection. There were 10,000 of these posts per day on average. This is from the Washington Post, ProPublica piece. And lots of the posts that were quoted were talking about, quote, civil war in the streets. Breaking news. I just saw from one of our amazing Notie gang members, Yada, the New York Times is going to buy the athletic for $550 million. Wow. That is a great deal for $1,000. for The New York Times because the athletic has a great subscriber base.

I don't think the athletic should have sold. I think they should have gone public. They should have kept going with that subscriber base, but okay. I mean, it's a great deal for them. They'll make some money, but I would not have sold. I think the athletic could have challenged ESPN. It could have been a $5 billion company, but sometimes it's hard to raise money for media companies.

But this is going to be a great deal for them because they're trying to drive subs. And they don't have Trump in office to drive subs. like they did for four years. Oh, they'd be in the New York Times? I was like, why would the athletic be? Okay, slow burn. Slow burn over here. The athletic is like, you know,

it's a subscription-driven sports site, and you can only read stuff on their subscriber. And the New York Times subscriber base has been growing. And they don't want to be competing against the, you know, this is the thing about ad-based businesses. As you do venture capital, you'll see. Anybody who says they're going to have an ad-based business, it's like, are you sure you're going to have an ad-based business at scale?

Because, gee, the duopoly of Google and Facebook seem to be running that business now online. It's very hard to compete. And now Amazon's in it. So this is, producer Nick says this is essentially even with their valuation in their last round

in January 2020 when they raised it at a $530 million valuation. So does that suggest they were in some trouble? Suggest they hit a wall in growth. And they couldn't raise additional investors. So what happens sometimes is, and we had the founder of the Athletic on. I'll get the episode number in a moment.

And they were doing well, but there's a concept of natural audience, so a natural number of subscribers you can reach, or it becomes incredibly expensive to acquire the incremental ones. So you kind of get the easy ones, and you're growing very fast, but then to get the next group of people, so you get the top 10% of the market, but get in the next 10% becomes very expensive.

And then investors go, you know what, I got other software investments I can work on. That would be a better place for me to put the next $200 million, late stage deal. So they probably couldn't get that $200 million they needed for their next deal. But the New York Times looks at it and goes, well, we can reduce our churn. We already have subscribers. So if the New York Times reduces churn for, you know, and they have a lifetime value of, say, $1,000, if you got a lifetime value of $1,000, you know, you only need X millions of people or hundreds of thousands of people. Let's say this is a lifetime value of $1,000,

for a New York Times subscriber. 500,000 incremental New York Times subscribers pays for this. Yeah. That seems completely possible. I don't know how many subscribers the athletic has, but I got to think they were close to a million? I mean, that would be a good, I mean, you have the meditation apps hitting millions, right?

I think Headspace has a million and- And sports, I don't know if you know this about America, but sports is pretty popular. It seems to, based on what I see on the weekends, on Twitter, 1.2 million subscribers for the athletic. Wow. That means, I think the athletics is $100 a year or $50 a year.

So if it's $50 a year, that's $50 million in revenue. So it's 10 times their top line revenue, which is what media companies go for 10 to 20 times, five to 10 times their top line revenue. So this is probably a good purchase. This is probably a great purchase for the New York Times. And a great outcome for the founders of the athletic

and a bad outcome or an okay outcome, a push basically in, is how you would look at it. It's a push for venture investors. I feel like, side note, the New York Times is the Amazon of media. They're, see, they're really on a massive acquisition. I mean, they're acquiring all the talent, all the productions. Like, I actually feel like this is a bit of a loss for the media environment, too.

It's like, it's getting to the point where there's not going to be like an independent standing because the time is up. You also have all these independent folks. Like, I bet a lot of the athletic top folks leave and do their own substacks for, own podcasts. And then it'll be, because if you're a top person at the athletic, you were probably there as a top performer, you know, columnist in desire. That's a desired columnist. You were there because they were paying you well and you want to get equity in the athletic. That would be a little bit of a pot sweetener. I don't know if they're going to make any money those top contributors. So they'll probably leave to go to substack to start their own podcasts and be independent.

So 1.2 million subscriptions for the athletic. New York Times is doing this to hit their goal of 10 million subs by 2025, if they had 10 million subs in 2025 paying $100 a year, you know, $100 a year, you know, it's a billion dollars a year in revenue, pretty great. So, quote from the New York Times article, the site now has about

600 employees, roughly 400 of them are editorial staff members making it the second largest employer of sports reporters in the country behind Disney-owned ESPN. And I really think there should have been a venture capitalist who backed the athletic to go after ESPN, or a merger between ESPN and the

athletic would have been great. Or Disney supposedly wants to spin out the ESPN and have them, you know, be more independent. Because it's always been a lot for Disney. It feels like there could have been a good bidding war between Disney and the New York Times for this. You know, Disney to get scooped by the New York Times would be like Facebook losing Instagram to Twitter, which they didn't, right? And in fact, Google was super pissed off that Facebook was able to buy Instagram. from my sources, Larry Page was infuriated that Google did not win that a billion-dollar deal for Instagram. Yeah, big time.

He, like, made some changes. Really wanted it. I mean, just imagine you bundled the athletic subscription with Disney Plus, Hulu, and ESPN, like, oh, you bought Disney Plus, or you bought ESPN plus, whatever, Hulu, you get athletic with it. Or you're reading athletic and they upsell you, you know. That's genius. Like Disney. You're paying six, seven bucks. That was a whiff.

That's a big whiff, yeah. bad job on the M&A team at Disney, which is the best M&A team in the business. They bought Disney, Pixar, and Marvel, but Bob Eiger, who I've been trying to get on this program, producers, because his book is so good, you know, he's not there anymore. So that's probably why they probably just aren't as sharp on the M&A. All right. So I guess next up is my interview. I was able to interview AXI and Finita co-founder, Gijo, Zerlin.

They've got over 2 million players, and it's really cool. crazy, Molly. You basically earn crypto. You pay like two or three hundred bucks to buy your characters in order to play in the game. So imagine you were playing Grand Theft Auto, a call of duty, and you earned cryptocurrency while playing, not a ton, but if you were a top player, you earned 10 to 25 bucks, I think, a day. And then consumers can buy crypto and kind of be owners in this. They're kind of on the cap table by buying into this currency, which would be as if, you remember the World of Warcraft Days? Imagine when all these World Warcraft players were playing,

if you and I didn't play World Warcraft, but we could buy the swords or the gold or mana, whatever it was in that game that they used as a device, we could buy that as an investment. Pretty crazy, right? This is fascinating. This is such a fascinating interview, and I'm really excited for everybody to hear it.

I, for one thing, am shocked and should not be shocked at how much people are willing to spend like $70 per token. I don't want to give too much away about that, but what we're going to find, and I had a thought while listening to this, that if you wanted to turn an asset class into a cryptocurrency, you would do it by creating an in-game economy. And then basically being like, no problem, we stress tested this as a currency already. It's working. Here, you know, here's the market for it.

And then you just like unleash it into the world because they're building it. And there are millions of people playing. I think they have two million players a day or something to that effect. And fun game. Totally. And a fun game. I mean, this is the, this really does feel like, you know, I'm a skeptic of a lot of crypto projects.

And even in this project, I think, you know, oh, my God, there must be a lot of, like, you know, speculation going on here. But people spend a lot of money on video games to get a lot of value. So if you pay 50 bucks for quality duty or you spend 20 bucks a month on Fortnite, you know, costumes or whatever, and you're spending $200 a year of Fortnite, but you're getting five hours a day of value from it or 10 hours a week, it's a pretty good deal versus movies or music or other entertainment options. Yeah.

And kind of cool that you have a stake in it. In this case, making $5 to $20 to $25 a day, which, you know, it sounds like if there are people in the Philippines earning that money, or I don't know, I could imagine like my kid would be stoked about that. It's going to be a really hard conversation when you say like, hey, stop playing video games. Where's that going to get you? And they're like, well, I made $100 today. Or my characters are now worth $20,000, mom, and I paid $200 for them. So I've got $18,000. I can pay for college next year myself. I don't need your allowance ever again. Exactly. I mean, it's kind of the dream to get played. paid for video games. Like being a video game tester, I remember in the 80s,

people are like, you can get paid to be a video game tester and play video games all day. I'm like, yeah, good luck with that. I think there's like 10 of them in the world. But it's a good interview, and I hope you enjoy it. It's 2022, and it's a great time for you

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we really do appreciate it. All right, everybody, we've been hearing a lot about NFTs. We've been hearing a lot about blockchain. Obviously, video games with purchases inside, whether those are swords or mana or tokens, has been around for a long time. These two things are coming together, and the leading player in that space is a company called Sky Mavis,

and that's a game studio that makes a game that you've probably heard about if you've, you know, anywhere around the crypto space called Axi Infinity. It is one of the top five most played blockchain-based games, and number two by monetary value. Today we have the founder, or the co-founder, I should say, Gio Zerlin. Did I pronounce your name correctly, Zerlin? That's correct.

All right. Welcome to the program. Just starting right out, what is the difference between a game that is based on crypto, blockchain, NFTs, et cetera, versus a normal game? Sure. So my framework, when I'm looking at, right, does this app need to be using blockchain? I usually look for applications or industries where there is an extractive middleman or middlemen that are basically taking a majority of the value when, in fact, the users of these projects are actually generating the majority of the value. So in my opinion, an NFT game or an NFT Empower

game is a game where the community is also sharing in the success of the game. And this is right through exposure by owning different tokens, whether that be NFTs or governance tokens that represent some stake in the ecosystem. Got it. So in this first game, Axi Infinity, maybe we could just show a video for people who are watching because now Spotify supports video. If you're watching this week in startups on Spotify or we have a video feed on Apple Podcasts or if you're watching at YouTube.com such this weekend. But I'll ask you to basically, Gho, to sportscast us and tell us what we're seeing. So we're putting it up on the screen now and I see a bunch of little cartoony characters talking to each other or fighting with each other. What are we seeing here?

Sure. So axes are fierce and adorable digital pets. Each Axi has six different body parts, those body parts actually correspond to the cards that they're drawing in battle. So, right, the idea is to knock out your opponent's axes by playing cards that are going to be strategic based on the situation and the axes that you're actually attacking. Certain axes are stronger against other axes. They have kind of like types that kind of their advantages and disadvantages. Some axes are really great at taking damage and absorbing damage to protect their teammates.

Others are better at attacking and taking out the enemy axes. Got it. Axis can be bred. So there is a whole breeding component that is tied into the battle system. And so the population is actually, right, the genes are actually on the blockchain. So you can think of it as, right, There's this Mendelian arms race that's happening with these digital pets,

where the population is actually evolving over time based on what's becoming popular and what is called the meta game. So people are building these characters. Do they have to buy these characters in order to play? Is it like playing coin-operated video games in the 80s and 90s where you put quarters in? Or can I just start playing this on my PC or my iPad or a console? Where is it played? And how do you play, as it were? So right now, in order to play, you actually need to purchase a team of three axes,

or you can actually borrow a team from someone that's willing to lend it out to you or perhaps a percentage cut of the resources or the in-game tokens that you're actually earning while playing. Got it. How much does it cost to buy in Axis or a trio of Axis, I guess? Axis right now, I believe, are around $70 each. Got it. So for $210, you can start playing the game.

Do you lose the axes? If you lose the game, is it like playing marbles in the old days or some other game where you have something at stake? That would be a fun game mode. Yeah. But right now, that's not the case. So each Axi can only be battled

or each team of axes or each account can only battle a certain number of times per day. So that's really the thing that limits, how much you can, how much of the in-game resources that you can actually earn. Right. And how many people have bought

these trios of axes? So right now there are just about 2.9 million unique addresses that own axes. They're around 2.5 million people who play every single day. Wow. So this is not an insignificant number of people. This is in fact probably more people than play any VR game right now on a single day. These, so if you sold about three million wallets own them and they cost 200 apiece, have 600 million dollars worth of these axes been sold? So the total lifetime volume on our NFT marketplace is actually $3.8 billion. Why? Because some axes are actually worth significantly more than $70.

There are axes that have sold for hundreds of thousands of dollars. We also have other NFTs in our ecosystem. We have things like land and land items. So one thing that I also want to get across is that, right, the game that you just saw is actually just the first of many experiences that we're building in the Axi universe. So we are actually building a new upgraded version of the battle system that will allow people to get started, fall in love with the game, learn the game mechanics before making any kind of significant economic decisions.

We think that that's going to be a game changer. We're also working on a land-based game, kind of like a town builder where you're building up a little village, and building structures. Clash of clans or Age of Empires. slash of plan slash age of empires slash Darley. Got it. We're thinking in terms of traditional. So when hundreds of millions of dollars have gone through the system, does your company

get those or are those people trading with each other? How does that work? So the way that we align incentives is so that our in-house NFT marketplace, which is processed over $3.8 billion of NFT volume, that has a 4.25% marketplace fee. that fee is actually taken and sent to a community treasury. And Sky Mavis, the way that we kind of have exposure to that is we own around 20% of a token that basically has governance rights over that treasury. Got it.

So you've created your own currency in the world. You get 4% of all transactions that occur. If a billion dollars goes through, that's $40 million, if $3 billion goes through, that's $120 million. That $120 million. your company gets 20% of, which is 24 million, which rounds it up to 25 million. So that's how you make your money, that 25 million. But the rest of the community gets to put those, that dollars into what, game development? Where does the other 100 million or so go?

Sure. So right now, all of those funds are actually just being accumulated in the community treasury. It's possible that there will, right, it may be the community will like to use it for different initiatives, but it's also possible that people can stake those tokens and then receive tokens in return. So the treasury could theoretically be streamed out and sent to the token holders, of which we're only one of many.

Are people making money playing the game or speculating on the value of these characters? There are some people who are making money by playing this game. We just went through a horrible pandemic, places like the Philippines, and Benazillo, these are places where, right, if you're able to earn a couple of dollars a day by playing a game, then, right, that can be pretty life-changing. So, yes, there are communities where this is making a huge difference. I'll also say that, of course, right, part of the reason that this works and that there aren't just millions of these games out there is that you need to have the right mix of a fun game, an amazing community and a well kind of balanced economic system, right? It's not, this isn't a new parallel universe where, right, right, Money just grows on trees and anyone can basically get rich. This is a system where there are some people who are spending money for fun, for pleasure, for convenience,

and then there are others who are trading their time for capital. Which is not unprecedented. People might not know this, but a game World of Warcraft, which has almost 5 million monthly members, which you're pretty close to, and I'm sure you've taken some inspiration or at least notes on, had a phenomenon called gold farming, which wasn't just to that game, but people used to in China and some other places, Manila, I think in the Philippines,

people would play the game, and like you said, you're in a place where getting paid $5 or $10 a day is a good living in front of a computer, they could basically play the game, get some gold, and then sell it to somebody in the West who wants gold. And they would do that typically off of the platform

in some Fugazi kind of way, but you've built this into the economy here. I think the key difference is that rather than forcing these people who would like to engage in this type of behavior, forcing them to hide the behavior, right, threatening them with bands and forcing them to go into these kind of third-party websites that can be quite dangerous to use often. We're encouraging this. We think that this isn't a feature that many gamers would like. We believe that game assets are property, that they're digital property. that when gamers are given digital property, right, you start to see really interesting

behaviors emerge, right, where they become super evangelist, they're kind of dedicating their lives to the game, right? Like, people wake up every morning and say, like, you know, how am I going to help the Axi infinity today, right? And that's because they're seeing themselves as, right, not just players, but also part owners of this ecosystem. Which is pretty fascinating. If you thought about it like World Warcraft, if the first million people in World Warcraft who really popularized it, if they were to get some sort of kickback or payment for every person they brought onto the system, that would be kind of like affiliates and those things have existed. But here, because you have this token that represents

that they probably have bought into an own or these Axis characters, they can flip those to make money or rent them out to make money. Yeah, sure. And we also even had this event where when we released our token, it's called Axis or AXS, the Axi Infinity Shark. When we released that, we actually said, hey, there are 10,000 people in the community. You've gotten us to this point. We're actually going to take a snapshot of your activity, like how many axes you own, how much land you have, how many battles you've won. And we actually ended up one year later after the token had gone up about 100,000 percent. We ended up, you know, kind of making good on that promise and dropping around $100 million, $100 million worth of tokens to those initials.

10,000 missionaries who helped us get this project off the ground. So these are, are Americans allowed to play the game or are you caught up in this? Like, is it a security? Are you paying to play a game? Because if you think about a utility token, by definition, you know, a lot of the people were speculating on cryptocurrencies, I mean, they're buying Ethereum or whatever it is or Solana. They have no intention of using it.

I would think the overwhelming majority of people buying your tokens are actually using them in the game. so they are in fact a utility in the game, correct? I think the key difference is that, right? Unlike many projects these days, we built a functioning game. We built a community long before we even released the token. So this is a rare example where the token for the project actually came two years after we started. So we think that that's really the model.

We unfortunately don't see that too much. And this recently over the last year, things have been very schizophrenic, right? And I think founders have been forced to make difficult decisions, I'll say, or maybe the incentives are way different than in a bare market where you're, you know, kind of like building alongside your community. So I think that's been one of our advantages as well is, right, that we, you know, we've been able to work on this for three to four years, almost four years now. And we've learned a lot along the way. And we've been able to take things methodically. And we haven't been kind of pressured by anybody really. it's incredibly hard though to just play the game you can download the game obviously on ios or play it on

your mac it's available on a lot of different platforms however you have to open up a wallet i believe go to finance or some marketplace to buy the is it a excess tokens is the or are they just called access tokens or a xs is how it's how do people say it access access so they have to go buy access tokens so you have to be a kind of a crypto head to figure this out it's a little bit of a hard on-ramp. Is that correct? Sure. It's definitely still quite difficult, which I think is actually, it shows that there's huge opportunities ahead. This will get easier. For now, it is quite difficult. You do need to create a Ronan wallet. Interestingly, we've actually were working with a Fiaton ramp where you

can buy ether or access tokens or the in-game resources directly using a card or credit card or debit card directly from the wallet. And so you don't have to necessarily go out to a different crypto exchange. But yeah, it is quite difficult. I think that's also part of the beauty, though, is right, we've been able to, right, despite all these steps, onboard millions of people into crypto. 75% of our users have never used crypto before. 50% do not have a bank account.

So I think, right, this really is a golden moment where we're starting to see the path forward, right? And that, yes, it's still incredibly difficult to get started with this technology. yes, we need to make it a lot easier. But if we have these engaging, beautiful, fascinating projects, there are people that will jump through the hoops and start going down the rabbit hole. So people can also just, if they think this is an interesting project,

like if they thought Call of Duty was an interesting game or World of Warcraft or whatever, they can just buy AXS tokens on Coinbase at this point and just buy them and hold them thinking, hey, this game could get a lot of traction at something. point. Are people doing that as well? That's definitely one of the major ways that people find out about the game is, you know, they might buy access tokens first and then say, hey, this game, it seems like it's doing

really well. Like, I want to be a part of this, right? And then once you own the token, that's some incentive, right? Some, some research, some excuse to basically start doing some research and learning more about it. So that's definitely a common way that people started to get more and more involved in the project. I think the amazing thing, right, is that historically, so I was never really interested in crypto. I grew up as a gamer, as a collector. I was also very interested in like military and economic history. I wasn't, I wasn't interested in crypto when it was just about Bitcoin. But then when I found out about NFTs through the, you know, the early project CryptoKitties, I thought, hey, this is something that appeals to the gamer in me. This is

something that appeals to the collector in me. This is going to be huge. And it's some way that, right, non-technical people, they don't necessarily have to feel at a disadvantage, right? So it feels a little bit safer and like you're not necessarily playing with outside of your zone as a non-technical person. So when you create a company like this and you start selling these tokens, the market cap now of the tokens, I understand, is over $20 billion. And how many of those tokens, how much of those tokens does the company own? Because all this is public information, I understand, right?

Like the ownership of the tokens. So how many do does the company own and then in the treasury of the company, I guess, versus, say, investors in the company or just people who are buying them themselves? Sure. So Sky Mavis owns around 20% of the circulating supply. I'll also say that the fully diluted valuation is $20 billion plus, but I believe that the circulating evaluation is maybe $5, $6 billion. I think crypto went down today.

Oh, okay. So of the people who have them, there's a bunch of people who may be holding them who can't sell them or they're not in circulation. yet. But essentially, if this takes off, you have this incredible, basically like public, it's almost like you're a publicly traded company where people can buy in and buy shares of the company and bet on you. And you have an unlimited amount of capital now to produce games. Is that correct then? We have a very special opportunity in that, right, I think in crypto network effects and first mover advantage are real and very powerful. And right, I think people see that we're

we have this amazing community. And we have something that the rest of crypto really needs, which is users, which is attention, right? This is the ultimate manifestation of maybe the attention economy where we've actually been able to onboard millions of people into this ecosystem. And right, they're also, you know, going to be looking for other things to do, right? Like we've onboarded them to our decentralized exchange, just called Katana that has around 31,000 daily active users right now. So, you know, one of the most used defy applications in the world as well right now. So we have this opportunity where, right, we have this attention. And I think we can divvy that up among many, many other projects.

So new games and yeah. Yeah. Who's going to make the new games? Is community make the new games or is that what you think your company is going to be specializing as you make new games? Or is it possible you could say to a game developer who makes traditional games, hey, why don't you just use our AXS token? We've got all this money sloshing around.

We'll gift you, you know, $10 million in. tokens to make your, I don't know if it was Angry Birds in the early days or, you know, some other game, Clash of Clans in the early days before they became a billion-dollar franchise. You know, if you had some, you know, indie game developers, you could just give them these tokens to start building. That's definitely part of the vision where we want to make it really easy for both community developers and third-party game developers and these indie studios and perhaps even, you know, large AAA games studios that are interested in NFTs that gets, you know, to come in through our

universe, use our infrastructure. So one of the things that I also want to mention is that we've built this scalable NFT infrastructure. It's called Ronan. And just on Ronan, Ronan did more volume, NFT volume than all other NFT scaling solutions combined in 2021. So we've shown that it's battle tested. And there are many game developers that are super eager to build on top of Ronan.

Why? Because you get access, you get instant distribution to this incredibly strong community. So let's pull up this chart here. This is the AXS relationship or the access relationship for the token. Explain to me what we're seeing here. You have players, the game universe, community treasury, and access holders all in this kind of flywheel. So maybe you can walk us through this chart of how the ecosystem works.

Definitely. So at its core, if someone wants to get more axes, whether they're a new player or an existing player expanding their collection, they need to actually buy those in a peer-to-peer transaction. Where do those axes come from? Those axes come from breeding. And in order to breed axes, you actually need to burn some in-game resource, right? The only way to actually get that in-game resource is by playing the game. So basically the way the economy works is that if there is demand for axes, then, right, there is demand for in-game resources. So then, right, it's basically it's possible to price the in-game resources,

then we come to a system where players can actually earn by playing the game. So this is a chart depicting kind of the access token ecosystem. So players can actually earn this token by playing the game as well, by placing on the leaderboard. When they're spending money, that revenue is actually going into something called the Community Treasury. Players can stake those tokens, and then receive kind of rewards from the community treasury that are coming in, you know, through.

What does it mean to stake for people who don't know to stake the token? Staking means, staking is a system where you can lock up your tokens. It's a way of signaling that, hey, these tokens are locked. I'm not going to be selling them. And then once you stake or lock these tokens, you can then, in many cases, like vote on different proposals or you then become eligible for rewards. Got it. So just super complex here, but if I'm understanding it, I'll reflect it back to you.

When I play the game, I can earn axes by playing the game. And if I hit the leader words, that can then be used to breed axes. Got it. So I get the, I get the basically components that could then become an axes because I earn some other minerals or whatever in the game. then that becomes axes. Now I've got something of actual value that I could sell to somebody else.

If I played the game and I was a top 10 player for 10 hours, what would the value of those and I was able to put those resources to work to make axes, what would those be worth? So definitely rewards scale quite heavily as you become a quite good player. I believe some of the best players

are earning around maybe $25 to $30 per day. And then you can enter tournaments, you know, to win much larger prize pools. Right. I think like it's very, there is a flaw, right? Like in the system right now as it's currently designed, which is, right, that it kind of requires that there's always this constant demand from axes. A lot of it is coming from new players, right? So one way that we will address this in the future is, right, as we build this universe out,

people will be able to upgrade their axes, right, for, you know, kind of cosmetic benefits. and, you know, just to increase the rarity, right? And then you might be either burning in-game resources or perhaps releasing axes permanently and getting some crafting materials that are then used to enhance the appearance and perhaps even the power of your axes. This is kind of like part evolution.

And it's something that is really needed in the long term. But we've really focused, kind of we've had to be super lean. I think we've been able to move quickly. one of the reasons that we've just prioritized features that we thought would get us to become a household name in crypto. But yeah, so the game economy is still very, it's still in a very early state. And yeah, but we have a lot of awesome additions that we'll be adding over the next couple of years. Is it hard to manage this relationship between the people who want to speculate on crypto and the people who want to play the game? Because people playing the game, let's face it, 25 bucks a day being one of the top players.

If you run the top players, you'll probably pay poker or be a developer or you're just wickedly smart and good at, you know, games of skill, which is kind of feels like a game of skill, right? I think it would kind of fall into that category. It's $25 not enough money for you to quit your day job. You probably have plenty of other options to make $25 an hour driving DoorDash or whatever. So, but then you have all those speculators playing the game. How do you balance what the speculators want in buying tokens? And let's face it, that could be, you know, very, um, lucrative for you as a company versus what the game players want.

It can be quite different. There are so many different types of stakeholders within the economy, right? And within the ecosystem, there are people who are just, you know, battling for fun. There are people who are battling very competitively and trying to climb the leader for. There are people who are just collecting axes because they think that they're cute. There are people who breed axes because they, you know, want to see what type, what all the different visual combinations are and then try to have the rarest axes. There are people who, you know, also are renting out axes to people and kind of seeing it as their own little business.

Their own little digital pet business or store. There are people who are buying axes and hoping to just flip them. So there are so many different archetypes, but I think that's also one of our strengths is that we have. There are so many ways for people to get involved. It can be difficult. I think, right, we have to prioritize, in my opinion, the needs and the desire. of those that are playing for fun because they're in essence funding on the network. So the people who are playing for fun as well as the kind of long-term builders

who really see this as a exercise and co-creation with us. I think if I had to pick two archetypes of people, I think generally those two buckets are the ones that we have to, I think, be in super close contact with. unpack for us how renting and scholarships work of these axes in the game? So one of the things that we've done is we have disconnected the ability to use an from the actual ownership of the axes. So you can play on an account that you do not own. How does that mechanically work?

So the axes are stored in a blockchain wallet. But the actual gameplay, right, in order to play the axes, all you need is a QR code. So what you could do is you have your own axes. You can share the QR code that allows someone else to play with them. And then, right, someone else can play with your axes without actually being able to steal your axes. You know, something goes wrong. Yeah. So that was like a new thing that we hadn't seen before.

And because of that, that allowed, right, this new model where people are, you know, you know, being able to trustlessly lend out their game assets, their axes, in this case. Can they revoke the ability for somebody if they let them have the QR code to rent it? Can they revoke it? So the QR code expires every few weeks. Got it. So if I had these for fun, I could just tweet my QR code and say, anybody want to play, go ahead and first person who gets in gets to use it kind of thing until it runs that?

You would want to only share it with one person. Okay. Got it. And then they can learn how to play the game, et cetera, and go from there. But people are buying up. How much do they rent them for a day or for a month? Are they renting them by the day or by the month? So basically what they'll do is just agree to a split of the tokens, right?

So maybe 40% of the tokens that they earn, they'll send back to the owner of the action. So that's fascinating. This would be as if in World Warcraft, I had a level 100, whatever wizard. And I was like, I'm not going to play this month. It's finals. Anybody want to play this character for a month. Don't do anything stupid, but whatever you make in World Warcraft, I get half, you get half. Kind of an interesting model. Definitely.

And the thing right, in World Warcraft, you can't trust someone to do that because they can go on your account, right? They could drop all this. They could drop some of your stuff. They could ruin everything, right? So it is really, I think, interesting where you're basically separating ownership from usage. Fascinating. And so how many years were you? you building the game before you introduced all the crypto?

So we started building AXI in 2018. In the beginning, you couldn't see your AXE. So when I found AXI, I actually found AXE as a community member. And I found it and you couldn't see them yet. And then there was one day where all of a sudden, hey, there's an unboxing. You could see your AXE's. Then you could sell them. Then you could breed them.

And then there was a very basic auto battle system that was in 2018. that got us to our first couple of hundred users. We then kind of expanded the vision by having a land sale, and then we released the current battle system. So the current product, which has gone to millions of people, was actually built by less than 10 people about two years ago. So we actually have a major upgrade that's on the way. But, yeah, it's been a very iterative process.

Most games, right, they can take years. And, yeah, this is a very, I think, we're building in public alongside the community and from way before a traditional game developer would have showed anything to the world. I think a fundamental difference in how these games are built where they're kind of built alongside the community where you're getting constant feedback. And because people have a stake in your project from such an earlier point, from such an early point right there, you all automatically have like people who are willing to be your

testers and give you, in many cases, harsh, harsh feedback. because, right, there are real economic implications for the project failing for many of them. Tell me about the whales behavior in the system. All these systems have whales, famously Zinga. Some of the whales are spending $1,000, $10,000 a month on tokens, mono, whatever it was, you know, the game device was. What are the whales spending playing the game and buying items or bundles or land, etc? So I've talked to many of the whales. Some of them are just, right, they're collectors where they might want the rarest axi. They'll then, you know, they can then use that to meet other like-minded whales.

Some of our whales have started kind of local syndicates where they're, you know, kind of done really well for themselves by basically making social connections and then basically using their position and their fame within the acts of universe to kind of accumulate social capital. There are others that see this is kind of like, you know, one of those management sims where, right, they just want to help people and they want as many scholars as possible. And, yeah, they, you know, they're kind of more looking for glory. So they might be looking to start like a guild that is very prominent that wins a lot of tournaments as well. Yeah, I think like also like it's really important that we also encourage more, more well spending in the future. I think the current system doesn't necessarily have enough options for them to kind of show off within the game and to spend for fun and pleasure. So the examples of that would be having super rare items that they might need to burn a lot of in-game resources for or just sacrifice Axis to receive. There's also this concept of people buying land.

I guess some people call it buying land in the Metaverse. I don't know if you consider Axi land Metaverse. I guess it kind of is. But I see here on the marketplace that somebody is selling a plot of land for, it's sold previously for one Ethereum or 1.2 Ethereum, but it's not selling for 16.95 Ethereum, $59,000 for Mystic plot minus 49, minus 29.

Are people really buying virtual land for tens of thousands of dollars? And what do they actually get in a piece of virtual land for $60,000? dollars? They're buying land for millions of dollars. The highest single sale for a single, the single, the highest sale for a single plot of land actually happened with an acting infinity, where a Genesis plot, one of only 75, actually sold for $2.5 million dollars worth of ether. I think it was around 550, I believe, just two months ago. So people are buying this land for a lot of reasons, right?

So some believe that there are going to be tokens of real value that can be generated by building out that land out. Some think that there will be like advertising value, right? If the game does well and there's a lot of eyeballs, right, then eyeball is an eyeball

whether it's... So there is a limited amount of... So just so we understand, there's a land that you can travel through in the game that's different than the heads-up card game that we saw before, but there's also like land you can travel around in and there's a limited amount of it and they own it. And so if like in World Warcraft, if we're all playing this map or if in Call the Duty there was one very popular map or Fortnite, you own that. You could put advertising on it potentially in the future or when people come to play on it, they might have to pay you

to play in that area, kind of thing. Sure, things like that. Or you could even build experiences on top of that land and maybe right. But what if you were, built in kind of a game, and then there's like this arcade setup where people might need to pay a small amount to play that game. Got it. So the person who pays $2.5 million on this,

people think it's crazy, but if they were buying $2.5 million and it was, I don't know, let's say a landing page as part of a website, and this was the early days of Yahoo! And you got the Yahoo finance page or something, and you had the rights to the advertising on that page,

it could actually pay off over time. It's kind of a way to think about it. Definitely. And I mean, the million dollar homepage. People are spending for status, right? It's like if you own a Genesis plan, then, right, you get to go. Maybe, right, you get invited into special chat groups.

And it's a way to socialize. Why do people, like, you know, we get into existential questions that are hard to answer, right? Like, why do people spend tons of money in the physical world on, on things that, you know, might not make sense to those who don't have millions or hundreds of millions of dollars? Yeah. I mean, if people go to a club. and buy some rare bottles of champagne,

and they spend $100,000 champagne popping bottles at a club. It makes no sense because you can buy the same champagne for $1,000 without sparklers and people dancing around your table with it. So there definitely is something for that. But I think actually the more interesting thing is, well, what if it actually did generate revenue in the future,

then you would be a sharehold in the game? When people buy those plots of land and you do that land sale, that goes into your community treasury, I take it, and then the company gets 20% and the community gets 80% or something similar. Yeah, so when we do, so 25% of the land has been sold so far in the future, if we do, you know, the land sales would theoretically, right, that revenue would go into the community treasury. Any ideas on licensing this or partnering with folks? I could imagine somebody like a Disney or Grand Theft Auto must be watching what you're doing here and saying, you know, we sell Grand Theft Auto, you know, for some amount of money or people buy in-game stuff. Man, if Grand Theft Auto was built on your platform or in a similar fashion,

I mean, people could buy different areas of different cities or from World Warcraft. So is there some thought to license IP or just keep making your own games? We are interested in bringing very well-recognized and beloved IP on top and bringing that into both the Axi universe and as well as Ronin. So we're kind of like incubating that IP within our universe. It's definitely the path forward. But yeah, it's going to be a long journey as well. What would be the dream IP if you could pick anyone?

I think Hello Kitty, just to say something maybe that some people might not say. Because Hello Kitty is great like a powerhouse. It's believe like the most, you know, the most valuable IP in the world. Is it really? Wow. And it does incredible amounts of revenue. And right, there is kind of that overlap where you have that kind of quiet aesthetic. So another thing that I'd like to say is that, right, like,

we haven't even started our kind of merch rollout. And I think that's also going to be kind of an aha moment for everyone. Because if you can sell merch and then use the proceeds from that merch to back the end game economy, right? It's like people are buying merch for fun, right? Like, it's because they think it's cute. Right. So I think like when people understand, right, that element and how we can harness that

type of spending in the physical world to enhance our digital nation, I think that's also going to be kind of a key moment in our history. Well, I mean, I think at this point on the way you're going, you could just buy San Rio, the parent company of Hello Kitty. I mean, I don't know what they go for, but I think you could make a run at them. Any problems you're facing right now as a company trying to keep this together in this crazy world? What's the biggest challenge for you day to day?

Yeah, I think scaling out the team, making sure that we're getting the personnel that we need, but also, right, like being able to push forward the current project. I think just like prioritizing everything. It can be, you know, it can be really difficult. I think exponential growth always breaks things. Like there are times where our servers were going down, right? It can make the economy much harder to balance because, right, sometimes if everyone hears that you can make money by playing a game, right? everyone's going to come in. And right,

but obviously there have to be people that are, there has to be a ratio, right, a balanced ratio between people who are spending for fun and then people who are playing for, playing for, basically. So maintaining that ratio, sometimes you can get out of whack.

And then, and then, right, there's a lot of economic volatility and, you know, there's real economic value at stake and, you know, so the stakes are high and that can cause,

right, emotions in the community. There can be like drama and things like that. So yeah, we're dealing with a lot of really interesting questions and issues. These are issues that are traditionally maybe dealt more by like founders of a nation rather than people who are building their first game. Yeah, it does seem like the people who are buying into this vision feel like they are citizens and they care about the governance of it and the direction of the company.

So you really have to keep them in mind because they're making big investments of time and money, capital emotion into this. It's a fascinating project and would love to check in with you in about a year and see how this is all going. More games coming, I take it. When's the next game going to launch? We hope to have some awesome game launches this year. So that basically, Axe Infinity Origin is our upgraded battle system. The art will be better.

The effects will be better. It'll be more skill-based, faster. And I think most importantly, you'll be able to find it on the app store and start playing and exploring without having to spend. Got it. So you could do in-game in-app purchases and have the ownership exist there. This Apple and Google allow the purchase of, because I know they weren't really into crypto,

but they do allow people to buy video game stuff. So if you're buying a sword in an Apple game, that's totally fine. But if you were to buy cryptocurrency, that would not be fine. So how do you think about that? And how are the platforms? something that we're trying to educate the different app stores around and work towards an amicable resolution, right? There are a different passport where you do some of some, there could be some things that are in-app purchases and for others. It could be maybe linking out. I know obviously linking to an external payment processor, right?

This is a huge debate or point of contention right now. Yeah, big lawsuit, right? Yeah, things are moving, I think, in the direction of being more open. So, yeah, you know, it's really exciting. Well, I suppose you could let people play the game without having ownership through buying in-app purchases. And then if they want to have ownership, they would figure out that you can also own these characters and not just use them one-off in the game. Or it could be two tiers of game, people who own their characters and people don't. And that could be another status thing.

Yeah, I think, right, like, one of the things that crypto has not done well so far is having some, right, you go from, like, in terms of thinking of in terms of funnel. right you go from awareness to like heart activation right it's like okay right like the first thing that you have to do is like actually buy buy something and i think almost all cases right so the ability to right learn and kind of you know fall in love with the universe and a community before actually having to go down the rabbit hole um i think that's i think that's going to be really important well i think it's a fascinating project congratulations on all the success another five or six your overnight success in the making and keep at it and we'll look forward to watching these new releases come out later in the year. All right, everybody, we'll see you next time on This Week

and Serbs. Bye-bye.