AMA with James Ferguson, CEO of Immutable on NFTs and Gaming

Transcript

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bankless nation welcome to this special ask me anything this is your opportunity to ask our next guest anything we are so pleased to have james ferguson who's the ceo of immutable that is the company behind god's unchained which is an ethereum based nft game that he's going to talk a little bit about james it's fantastic to have you welcome to bagless nation sir fantastic yeah i am thrilled to be here and i want to take this opportunity to say that i am a legit fan of the bank podcast nation and everything that you guys are doing well you can't see theirs maybe james has a bankless shirt we don't know yet like maybe he's got bank lists under that black

anyway welcome we're super excited to have you guys um if you're watching on youtube which is a fantastic place to watch this hit that like button uh that gives more exposure to the ask me anything and spreads the word you can also ask questions in youtube david's gonna help field those if you are a bankless member and if you are part of the inner circle discord you can ask questions there too we will prioritize those questions this is an opportunity for you obviously to ask questions david and i have a few of our own too james why don't we start with this question do you think games video games in particular are the key to mainstreaming the world to crypto that's been in the

back of my mind that's a big question in my mind what do you think i truly believe that games can be one of the trojan horses by which we get crypto into people's minds and by which we essentially change the model of ownership that people have in people's minds so obviously we've got a couple of people i'm sure who are listening who are very into games uh the number in the world is rapidly rising but it's hard to overstate uh just how big gaming is so in terms of industry size last year it was about a hundred billion dollars was spent uh 150 billion dollars was spent on video games and a hundred billion of

that was spent on items in those video games which people didn't actually own wait james so you said 150 billion was spent and of that 100 billion 100 billion so only 50 billion was spent on you know cds or game ownership the majority a hundred billion was spent on candy crush gems and fortnite skins and dota characters people don't own they only have a license to use it on a centralized account so that's crazy that i mean the gaming industry must have changed right i'm gonna i'm gonna i'm gonna sound a little old man here but like in the days of like diablo 2 when i was playing people didn't buy

like in-item games we we went out and we're like we bought the the cd-rom and we loaded it in our pc right we played that way this was even prior to the kind of um pay as a subscription model of gaming so it feels like gaming must have changed completely in the last 15 to 20 years completely so with the advent of new distribution methods mainly mobile and social from that point people made their games free and just constantly monetize the same audience by trying to hype them up and then take money for enjoyment whereas essentially what we get to do in the blockchain space is flip that model on its head the analogy

i like to think of is uh let's have a look at the real estate market how much money on the world is spent renting versus how much money is spent on the housing market buying and trading houses and if you the only option was renting the amount of money would that was spent would be less and we're offering way less value to people we're currently trading gamers as second-class citizens in the way that most like big games companies try to deal with it is hype them up take as much money as possible rather than empowering the players by creating this new market that they can play in and making the items that they actually own be meaningful economically so james let's go into the model of gaza

and chain because i think that will provide a lot of context with what we are talking about with the flipping on the head of the model of ownership right so so god's unchained for those that that aren't familiar is very similar to magic the gathering and it's also very similar to hearthstone and it has some of the best features of both and so with magic the gathering you have physical cards and you play against a person sitting across from you and you actually do have self-sovereign ownership over those physical cards uh because they're physical right in the same way that you have self-sovereign ownership over cash now hearthstone is um the game from blizzard which is very much similar to magic the gathering but it's done virtually it's all on the computer and when you own when you purchase those

cards and like hearthstone is a cash cow for blizzard they makes a ton of money for blizzard hearthstone made in the last year that they reported they made 400 million dollars right selling cards to people which they don't own right here so you you buy them and they are associated with your account and you get to access them and use them in play but you can't trade them with other people like magic the gathering cards because they're locked to your account right and and so you own you you own your account but you but your blizzard really controls everything how does hearthstone or excuse me how is gazon chain similar to both of these models and how is it different awesome so essentially it's take the best parts of both so what's nice about

our hearthstone is you've got a game that's quite accessible uh you've got a game that's so simple you don't need to remember the moves it's on the computer it's easy to find someone else to play against uh but they've got this you know sort of scammy free-to-play model of playing uh magic the gathering is a great game it's a bit more complex our game lies in between the two i in terms of complexity uh and what's nice is you can actually collect these cards you own them you can trade them with your friends however it's in the physical world and infrastructure for trading physical items is pretty weak right maybe you go to your local game shop which is where you play and you can trade against local people

but there's no reason that you can't combine both of them together and have digital ownership so essentially you need the blockchain for that but also you can build amazing infrastructure that allows you know a grand exchange of all these items to be traded constantly and get the best of both worlds so the way i like to say this is is like you get to have your digital versions of cash and now you also get to have your digital versions of you know your favorite trading card game right and so it's it's like a bear instrument like how bitcoin is a new bearer instrument except now it's done and instead of being a card in your hand it's a card on a block chain right so when you purchase these things you

actually receive assets right when you purchase gauss and chain cards tokens show up in your ethereum wallet and that's like the big difference between gauze and chain and hearthstone when you purchase something you just get something on a centralized database that could be wiped with gauze unchained tokens show up in your ethereum wallet and that means that like in addition to all those benefits there's also the d5 back end which they get to tap into just like everything else and that's a whole different story but as far as with like ownership it's just a huge order in the same way that like cash is being upgraded now like ownership over these types of cards are also getting that same sort of like special treatment from a public blockchain exactly and it's not i i really like the description of uh

eth as programmable money right and it's clear that programmable money is going to change the world so fundamentally but you can think of nfts as programmable bearer instruments right so it's not just uh i own this card but we can add in extra rules we can program certain levels of rarity they are counterfeit proof they're like fraud proof they like we've been having discussions internally about uh as we build out the new our new uh tech to be able to allow better trading of them what how can we increase liquidity how can we put characteristics of these better instruments and program them in so that we can allow more seamless trading so we can allow the d5 world to

go crazy and create you know whatever they want derivatives off them uh this is the way the world will go we're just building the fundamental building blocks in place first and building a great game at the same time and that great game is really important because at the end of the day if you just have a collectible or an item that nobody wants uh there's no utility for it in the you know traditional gaming sense then the demand is going to be capped uh it's non-negotiable for us at least that you have to build a top-tier quality game around it so the beauty of this is the player is really in control right so software on a bankless when it comes to money and

finances we talk about this this concept of of self-sovereign money right and that is to me the definition of like freedom right like you actually own your money as a bearer instrument you know you can do with it what you will this is essentially bringing this to game assets and and game items so the player receives all of the upside all of the benefit they have the complete freedom of a real world economy to do with what they will like these assets they can trade them they could leverage them they could maybe put them in a in a maker cdp who knows all the possibilities that the d5

economy will empower and like you guys don't even have to to create all of those possibilities because defy and the community is kind of doing it for you once the assets are valuable is that right so we have at this time just for god's unchanged because you know in order to support uh this ecosystem we open up our apis etc we make all this information available because we love encouraging the community to build so i'd say that there is probably about 15 to 20 different simple web apps uh that exist around god's unchained but all right if you want to five and eight really complex apps that people built like this extra infrastructure on top of it uh there's amazing marketplaces

there's amazing like score trackers there's things which are much simpler like do you prefer this art or this art i do prefer like which cards better this one on this one at the same time people are going like are starting to explore what it looks like to plug in these different uh assets into the d5 ecosystem right so i am convinced that one day and one day soon right we need to solve some fundamental problems around allowing liquidity and scaling for the trading of goods because it's actually a more difficult problem than even uh scaling and trading of functional items but once we have that infrastructure in place this is going to explode

and whenever there's a market for something there's always markets for derivatives so i'm looking forward to the world in which one day there's a you know goldman sachs desk uh goldman sachs probably being less important at this time than it currently is uh but there's a goldman sachs desk who's trying to keep up with the world and they are opening up a long position on a index of nature cards in god's unchained uh outperforming uh the maybe a war index and shorting the war index and i really think not only will we have that sort of world but once we have the right building blocks in place it's inevitable

instead of a goldman sachs desk it might be some wi-fi governors or something to that effect oh that will happen much earlier that will happen well so here here's the thing that's amazing right like so i am blown away in the world of gaming uh by the community's capacity and all of these gaming communities to just mod like they mod they at and they do this all because of their passion for the game just for fun right like what happens when you add crypto economic incentives to the modding so if i own my own assets i own let's say god's unchanged assets right i'm not only having fun i'm not only a part of this really cool community i've got some upside if i

start building god's unchained apps maybe i've got even a a business or a career for from doing it and trading it i can i can create my own economy that has got to like put some some some like i guess gasoline on the fire of all of the modding that we've already seen in the past or games that gamers are just doing for free so the way we think about it internally is there are three key loops that we want to grow essentially and we do this via empowering different people in the ecosystem around these items the first one of these is play-doh earn the second one is share to earn and the third one is create to earn

so play to earn is obvious you know uh what's really nice is if you are playing a game and you are earning items in that game that can be sold for real money you're essentially earning and the economics behind this aren't actually that crazy essentially as we were talking before about the free-to-play uh business model essentially the vast majority of players in free-to-play play for free and 10 of them pay and one percent of them the whales pay a lot right so it's this big curve what play to earn essentially does is shifts the curve just down slightly so that instead of most players playing for

uh free it's actually most players earn and then if the economics still works because you end up getting way more players and it's still the the whales who are sort of helping create this whole system and providing value into it what is super cool is that there are two other uh loops that we're building at so the share to earn system where the more people you bring in obviously you're helping grow the ecosystem so we want to incentivize that and help all participants in this ecosystem prosper and the final one is exactly what you said ryan around modding how can we allow people who create and create pieces of either infrastructure or items or value

around this ecosystem how can they earn in the game and there's some amazing things which we're exploring here so obviously you have the creation of ugc user-generated content which could be uh put into an nft or a clip of primary or secondary trading value that happens uh when an nfd is traded through something so what we're building out with our immutable x our exchanges we're very interested in allowing anyone who builds an app that interfaces with it they should get their share of their value and because all of ethereum is programmable at the value layer whether it's programmable money or programmable

items we can do that and we can allow all participants to be aligned and to win this is super cool and this is not all that foreign of course uh to crypto because that's exactly how systems like ethereum and bitcoin work like you can think of like the uh the play to earn as i'm running a minor i'm running a validator i'm playing in the crypto economic game of ethereum and i'm winning ether uh so very cool that model seems to work i want to ask a question that i heard a lot in 2018 and 2019 about this idea of nfts in games some people have said it's actually like overhyped right not saying i necessarily uh agree with that but

the the objection that i've heard is okay so hearthstone as you said james they're making 400 million a year right now fortnight god knows how many billions they're making selling these digital games so the objection i've heard previously has been okay so you're saying ryan you're saying james these nfts are going to be huge right but like these companies are making so much money right now they're never going to change their business model hearthstone is never going to give up that 400 million a year prize epic is never going to give up their their v bucks and all of the skins that they're selling what's your response to that james it's the ultimate innovator's dilemma right if if we were making uh like

three and a half billion dollars i think was the peak amount annualized it fortnight made the money that's a crazy amount right so if you're epic and you're making that amount of money there is no way you want to switch over to a different business model you are winning based off this business model but what is super interesting is that uh ultimately just like any sort of innovator's dilemma when you deliver way more value to the consumer everyone has to adapt eventually so we have users who uh we have quite a lot of users in god's unchanged who have come over not from the blockchain scene at all they have just come directly from the trading card game genre scene because we do a bit of marketing there

as well and once they understand this is one of my favorite quotes that i ever read uh from a player in our discord was that they felt physically sick when they went back to go purchase cards in hearthstone they felt physically sick when they realized what they were actually doing they got right at the same time yeah exactly they've been red killed for what ownership actually means and at the same time it's not just blockchain games currently that are looking at this space uh most of the big games have an eye on it we're in contact with all these you know giant companies and they're very interested to see how it shakes out and when they'll have to adapt but i'll tell you who is the most

interested the mid-tier games gaming is such a power law that the higher up you are on the popularity chart the more money you make by far so really really successful games make billions but if you're only you know the 1000th most successful game or the 100th most successful studio you don't make that much money and all of these games are and studios are fascinated in anything that can give them an edge and move them up and this ages via giving more value to their consumers more value to their players and ultimately aligning the incentives so that more people are able to

uh they can distribute their game to more people so this model is going to force the incumbents to change the only reason they're able to get away with these business models right now is because basically crypto economic gaming where a player owns their own assets does not exist yet but is now coming and is now emerging exactly i would say there will still be relics of the old model for sure um obviously having true ownership doesn't really give much value if it's a single player game so there are there are still going to be you know huge parts of the game industry which continue down the path

that they're going but for multiplayer multiplayer games and for games in which community status and ownership and trading and interacting with each other matter then so does value transfer all between people and those ones are the ones which are going to be transformed james i want to get to some ethereum and scaling related questions but i also want to bring up um because i'm on the periphery of the gaming world i i tend to pay a little bit of attention to what's going on and from what i gather and what i want to ask you about is there seems to be a decent amount of like disgruntledness from game and developers when they end up getting put under like the hut of just like blizzard or ea or you know something that has to really meet a

bottom line and from what i've from the sense i'm getting is like there's a lot of game developers who feel like they've lost the spirit of gaming because they're under these gargantuan just like uh you know factories of you know call of duty and fifa and just like pumping out the same thing the same business model etc etc cetera and so i would imagine that there's a high very high number of developers who already know how to code so like that's already a step in the right direction who are ready to like figure out how to start doing something on their own with maybe a new platform or or a new paradigm of game design maybe you could speak about that and if my hunch is is off or correct on that so you're absolutely correct so far the the stake that some of the more

established parts of gaming is in is there it's a reasonably mature industry which is undergoing consolidation and on top of that people are trying to compete on cost structures right making a game is a risky endeavor uh this means you know i think it would have been yesterday uh at the time this is filmed or yesterday for australia and that uh cyberpunk so gigantic game i think they haven't released any numbers yet yet but i guess that they've in this sort of 20 48 hours made more than half a billion dollars selling this game but their devs have been under the crunch for like almost six months like working

six days a week 12-hour days i'm sure some of them working seven days a week so it's a pretty brutal environment if you're working at some of the top tier uh top-tier bottom line focused publicly traded companies uh at the same time people in the games industry are so creative and they have not just creative in that they can think up amazing ideas but they have a will to create as well and a drive to create and so if they can see a way where indie games can start participating in a new economy that maybe is more uh you know doesn't have the same sort of gigantic cost that it it takes to get involved

at the early stage and secondly they can build a community in a game more organically and allow monetization along the way rather than like right let's spend 50 million dollars building this thing as cheaply as possible and work everyone to the ground and then release this and you know keep on running it uh from that point if it's a hit uh if we can offer an alternative i am sure and we're getting a lot of inbound uh like requests of people who are very interested in moving over to exploring this new green field well i am excited for that world to get explored because uh you know i've i'm gaming less and less these days and that's because i can't really find anything to resonate with and so maybe maybe that's a problem that blockchain

can solve um speaking of blockchain uh back in 2017 cryptokitties clogged the entire ethereum network right and they brought it to a halt and that has been like much of a talking point for ethereum naysayers then a year or maybe it was two years later later gauze and change released all of their nfts and it didn't do anything to the ethereum network it didn't clog it at all uh let's talk about that before slash after event like how did you guys figure out how to get what you needed to have gotten done under the constraints of ethereum's limited scale and then once we once we get to that point we'll talk about um where you guys are going now with even further scaling awesome so i don't know what the exact

number of kitties off my head but i'm pretty sure that the exact like the rough number is a few hundred thousand um the same with a couple of other popular games most of them have somewhere between ten thousand and a few hundred thousand items and these are tokens right tokens these are tokens and non-functional tokens and non-functional tokens are way less efficient to transact this is because you know i i can maybe on uni swap or i could send you if i had it i wish uh a million bucks worth of some token uh and only pay a small like a five dollar fee and then five bucks on uh a million dollar trade sure it's not that bad it actually

probably beats most of the uh you know traditional world however if you need to pay that fee per every single unit which is the way non-functional tokens work because they're all unique then you start uh it starts getting pretty punitive pretty quickly uh there have been a couple of attempts to try and solve this so one of the standards erc 1155 is sort of a multi-functional or a semi-functional standard but essentially the way they get a bit more scalability is by sacrificing part uh part of the non-functionability and uniqueness so it's sort of like having many many different erc20s what we did when we created so godzilla

trade has seven million arc cards roughly uh we why do we go with this number why haven't we gone with you know uh fewer more expensive items our goal at godzilla unchained is to take it mainstream we're not here to just you know make a profitable niche crypto game it's not interesting to us we're here to show the world the power of true ownership and that means that you need cheaper items in there especially if we want to have a true way to earn them so uh when we created a huge stack of these for the first time we used a pretty interesting way of essentially like compressing the data uh in a way that so this was some internal r d that was since shared on how to do it but it

allowed the creation of these items to offset a lot of the gas costs to later where to next right where to next essentially uh from this moment and even before we have realized that in order to hit our ambitions for god's unchained we need to make creation of assets creation of nfts and trading of nfts be scalable and we wanted to do it and i think a lot of different people have had this idea i think a lot of people know that gaming and these digital goods uh the trading event is going to be big uh unfortunately the way pretty much everyone else has decided who's taking it seriously to try and beat this uh has

been to try and compete with ethereum so you either have new blockchains which are generalized purpose blockchains so you know i remember even tron claimed that they had a gaming fund at one point uh and they're like tron will be the home of gaming or you've got newer ones who have tried to build their own blockchain or sidechain uh like flow who wants to try and be the home of this as well but for us what ethereum has is something beautiful and is that there are no vcs who it's not a centralized entity it's a risen organically and we wanted to work out a way that we could get scaling for ethereum and on ethereum rather than either a side chain which is essentially just a separate

blockchain with a bridge or a separate blockchain which is essentially even if many of them are you know trying to for branding reasons and trying to win over the ethereum community claiming that they're going to be symbiotic and friends ultimately they're in competition so we wanted to build a solution that would allow instant and gasless trading on ethereum so we've been pretty hard at work over the entire year building out immutable x which i guess would be a probably now a good time to give a quick summary of it yeah tell us tell us about immediately keep going don't stop awesome so how do you solve the uh how do you solve this problem which exists how do you solve scalability and ultimately

what scalability gives you which is liquidity for nf takes and this is what we've been thinking about and uh i know that you guys have interviewed metallic quite a few times one of the things that are metallic blades and so do we very firmly is that the zk roll ups and just roll-ups are the way that ethereum for now wins and the way that uh it's going to be built out essentially any other solution you know a brand new blockchain a sidechain is just too insecure uh they're either they sacrifice security or centralization at the end of the day however if you can use zero knowledge roll ups to batch multiple transactions together you can keep the security of ethereum's

main chain without having to compromise and so uh you know i think in the erc20 world people have been exploring this for a little bit everyone's excited by it uh and some people have gone down the optimistic roll-up route and some people have gone down the uh zk roll-up route in the nft world you can only go down the zk roll up right really i did not know that it's super interesting because uh essentially one of the big difference is a thought proof and a validity proof right which they operate on and uh when you publish a proof to the chain does it need to be challenged or do you

know that it's correct immediately and with zk robots you know that it's correct immediately for erc20s and functional tokens it doesn't really matter that uh they can be challenged and can be reverted later on because the company that's behind it can just float you the money and if it's reverted they can try and claim that back later but if you want to use a scaling optimistic roll-up and you've got a hundred thousand dollars of dye that you want to withdraw from it that's fine even though it will take two weeks to confirm uh the company can just loan you that take it take what is fair to run that cost and cover that risk and it's a fantastic user experience for you if you wanted to take a god's unchained

card out of a roll-up in order to use it to collateralize you know something on compound uh when they allow that or you know to interact with the d5 world some way could you imagine needing to wait two weeks until it was confirmed enough to actually use it on the main chain no the whole point of this is that we want to finally offer people the native like experience that they're used to and so it has to be uh a zero knowledge roller very so so that's what you're building then that's what immutable x is right that it's a zero knowledge roll up and you're partnering with software yes um so the team at software is incredible uh they have built some amazing proving

functionality around starks and what we've been using is taking this tech and using it to build up the best possible protocol for creating and exchanging non-functional tokens possible and a big goal here the driving what would like thought for the company uh is how can we allow liquidity to exist here so we've got a couple of really cool innovations which we have uh built and have on the rollout rollout map uh so a couple of these are when you're trading on immutable x essentially you get instant and zero gas fee trading that is like as someone who has dealt a lot with the blockchain world it almost

feels magical being able to click and see it uh confirm instantly while you know that you're still interacting with the blockchain so that has been huge and that's one of the the first things that we're going to roll out uh next we're going to work out we're in the process of working on the right incentives so that this becomes really popular uh as well as allowing it to work for all games and all apps we don't necessarily want to uh you know we're not interested in hogging trying to honk the space we're building this as a protocol which anyone can plug into the open seas the wearables the anyone who's in this nft space and they can get their fee and their share for

bringing their users uh and the demand and interacting with this protocol a couple of things we have on the longer term roadmap which we are incredibly excited about is the idea of a metadata slash characteristic virtual market so what do i mean by this this is one of the i think that when this releases it will be one of the biggest innovations that's probably happened in trading for a while but essentially because every nft is unique when you want to trade it you create an order in an individual market for each one right if i want to buy uh a certain golden ratify godzilla chain card then i start having a look you know you

can have a good ux where you can search and be like right filter only gold let's have a look and i can see what the prices are which have been listed but they're all actually separate markets if i don't like what's offered there then i have to create a you know buy order for each of them and you can filter to be able to see it what we're building out though is the ability that we have the metadata and the characteristics of each of these unique items are encoded and we can create virtual markets not for the item itself but for any item which matches the characteristics which a person wants so an example would be i could create a

buy order to buy any golden ratify card in godzilla chain or any golden card in godzilla chained or any card in god's unchained and when you get this you start being able to drop between different levels of specificity and create more liquidity at all levels while it's still just you know you list your card for sale at the price that you want to be able to sell it for and it will essentially be able to be automatically dropped into every single one of these markets automatically and that's where this stuff starts going crazy uh we won't have this released at launch but it's one of the big initiatives that we're going to push out next year and what we're so excited about okay so i just want to carry carry the

listeners through the process of of the the the evolution of the immutable platform that we've just gone through immutable used to have and still does has all the tokens on l1 and you guys figured out a way to uh you said compress and i really like that word compress the data needed to get the job done and that's actually i think a really underappreciated way to scale a blockchain is by the compressing of data rather than by then increasing the scale we can figure out more creative ways to compress data and that's like actually the very bitcoiner way to scale a blockchain but and that was great and that worked out and the the next problem you guys seem to run into is that uh one of the greatest features about gauze and change is that um if you are missing a card in

your deck and you want to complete your deck you can just go and buy it and that's great uh because that gives you the freedom and expressivity you can't you need to be able to create any deck that you want and this is the problem that i ran into where i would go and i wanted to go buy like three or four cards if you tallied them all together it would cost me like 20 to purchase the cards but it would also cost me like 35 in gas to purchase the car exactly and so as a player i was like um that's like just yeah yeah that doesn't feel right i don't want that um david doesn't like to spend his eat either yeah i don't like yeah no i like to keep my eat spend my die but keep my eat and so you guys are

now heading on that problem head on with the immutable x platform which is on a which is a zk roll up so you guys can generate the infrastructure that you need to support a marketplace for gaza and chain cards and that probably just it has a much more um seamless quality of life experience that the average gamer is ready to accept and and let's have a look at what this looks like um i was playing a game the other day after we did our latest update i played against a very cool deception deck uh they romped me and i'm like damn i want that i want that deck in the future as soon as that game has finished you'll be able to click buy all of this add to cart add to cart

instantly click it you've got it it's in your deck then eventually you'll be able to scroll through the deck and be like oh well this card um i like to show off when i play so i want all my cards to be decked out in gold uh or diamond uh you can do that by buying more cards and essentially forging them together into a version so maybe as i'm looking through i'm like you know what these are the best cards i click on this one upgrade to diamond or upgrade to gold it immediately searches the marketplace for this in one transaction without paying any like gas fees on that you can buy them all and merge them into that gold card and then put it back in the deck and it'll just feel like an app for people and that is the benefit of a of a

starkware l2 right or or a optimistic role of l2 or an l2 in general because that is done on a centralized database right because that's how starkware and rollups are run it's one centralized database with cryptographic commitments to ethereum and so you do get the the uh the treatment as a gamer that you would expect because there's no reason why you wouldn't be able to do that in a centralized database way and so there's no reason why you can't do that on a starkware l2 so essentially rather than us storing ownership we take sigma cryptographic signatures from people saying yes i'm trading this and then we update the state in our database and every you know 30 minutes hour or so we send that all back together to the smart contract and it updates it on

the main chain at the same time if people want to update it faster they can if people want to withdraw they always can cool cool and and the last component that i'm really stoked about is that immutablex can correct me if i'm wrong but is not a platform for just god's unchained it is a platform right anyone can tap into this and so that what really gets me riled up is like you there's there's a choice that people have been making over the last like two years do you figure out how to scale ethereum or do you figure out how to build your own blockchain and you guys are going with how do we scale ethereum route and like keeping keeping it under the fold of ethereum keeping it under you know the quote unquote the right ecosystem uh because

ethereum is the magical thing that we wanted to and so you guys are doing the hard route of scaling ethereum and it even seems to be like you guys have succeeded in that before a bunch of other players have have built their own blockchain so congratulations for that did i get all that right exactly tell us tell us about how immutable x is a platform for not just gaussian chained so we want to make sure that the way we conceptualize of immutable x is essentially as the liquidity pool and protocol for non-functionable items so unique items that means we are extremely the more people on it as well the more the benefit towards ethereum actually accrues right because you get to save even more and

more are gas costs as more items are moved into this layer too and you get the benefit of god's unchanged like cards can instantly be traded against another game's cards if they're on it etc so we're currently talking to most of the players in the space everyone's super excited because people don't want to leave ethereum but some people have been considering it uh you know there are other blockchains who are waving dollars in front of people's faces and saying not only this we will solve your like scalability solution they haven't necessarily built it out in a way that proves that it works that they will but they're you know trying to dangle this in front of people and so there's a real life

fight going over for developers mindshare that currently exist right now and we want ethereum to win we don't want it to be split up so that you know uh nft exists nft users and applications all exist on this one chain and uh maybe d5 lives on this other chain we want it all to be interoperable and have all the value on one because that's when you get so many more benefits and at the same time ethereum is essentially under attack on this front and we know that the tech exists uh we've built it to allow ethereum to win and to allow users to have an experience way better than they ever thought

and we don't want you know promises by other vc backed chains or side chains to be able to take people away from this you know community effort that we're all trying to build james that was absolutely fantastic there are a ton of questions pouring in on the youtube in the youtube chat so we definitely want to get to a lot of these questions the the gaussian chain community is here and they have questions before we get to that though we're going to take a moment and talk about some of these fantastic sponsors that make this show possible if you want to live a bankless life you need to get a hardware wallet there is no alternative for storing your crypto in a self-sovereign fashion that's why i have four ledgers that i use to manage my different crypto assets using the

ledger live account as well ledger live is like your home base for managing your ethereum defy and crypto accounts it does a really good job of aggregating all of your different ethereum wallets if you are the type of person that uses more than one but you can also add other cryptocurrencies like bitcoin or cosmos or whatever your preferred blockchain is and then it will display an aggregate portfolio of all your accounts at the main page one thing that ledger is doing a really good job of is enabling all the money verbs that me and ryan talk about with the bankless skill cube enabled in the ledger live app so right now in the ledger live app you can buy sell lend swap and stake your crypto assets which is doing a really good job of fulfilling

all of the money verbs in the bankless skill cube something that's new to ledger live is ledger swap where you can swap assets one for another directly inside the ledger live application ensuring trustlessness in your financial activity on ethereum and on bitcoin if you want to learn more about what you can do with a ledger go to the blog post the power of ledger live on the ledger website where they share some of the more advanced things that you can do with your ledger that you might not have known about there's a link in the show notes that will take you to the ledger shop where you can get your preferred ledger hardware wallets i personally like the ledger nano x but i also have both they're both great options when you own a ledger you own your own assets in the way that they have been designed to

be held by the user and the user alone so go get your ledger today to make sure that you are as self-sovereign as possible the bankless state in the nations are brought to you by wiring wiring is defy's first self-building community run project which i just get really really excited about wiring is a system that seeks out yield in d5 and it does that in a number of different ways a very aggressive way is with the vaults where you can deposit your preferred asset of choice and different defy experts will come in and generate a strategy for what to do with your deposited token right and so it'll go find ways to get yield in that deposited token in d5 for those who want to just earn yield on their stable coins

the earn system is for you where you can deposit your preferred stable coin and wire will go and figure out which money market on defy and defy is producing the best interest rate whether it's dydx it's compound or ave it looks around d5 to see where the yield is coming from and it directs stable coins automatically so you don't have to check them out at why earn.finance to get started and also check out the stats page to see what other people are doing as well all right guys we are back with james ferguson ceo of immunible and we are answering questions from the banklets youtube so now is the time to get the questions in some people have already been asking them so i've got a few of them here let's go with this first question which is also interesting to me

if i'm building a game with nfts do i need to build a back end specifically dedicated to immutablex uh essentially no what you need the back end for your game but it will be as easy as implementing apis so essentially we know that people don't want to have to deal with the hassle of trying to work out uh how to you know work out solidity code work out how to set up their own nodes in order to interact with the blockchain and hook it up with their own database we're trying to make that as easy as possible fantastic and then is there a plan to get genesis cards onto the imx platform or how how how is that going to happen

so this one is a really really interesting question and we have a couple of proposals internally uh we want to get genesis cards onto immutable x depending on the gas price this could be a hugely expensive endeavor to do like 10 million plus uh in order to get them all on millions of dollars uh what our current plan is essentially is uh we're putting together a couple of plans and we are going to uh ask the community essentially which one of these are uh most appealing to them i'm sure that we're going to get some interesting results but at the end of the day uh these are your assets and we want to do with them what is going to be best for you guys who own them

obviously if they're on immutable x there's some huge benefits right because that's where all the trading is going to be focused and i'm sure many people are going to want to have it on there uh in order to participate in that okay cool fantastic here's a question about uh gaming the nature of gaming for traditional games there has always been a space for secondary market trading even in diablo 2 i remember i remember diablo 2 there was secondary market activity as well traditionally this erodes the player's sense of fairness how do you go about avoiding a pay to win model in a game like god's unchained yeah so this was one of the great problems that we make sure that we wanted to try and solve when we first

you know designed god's unchained uh there's a couple of things which are really really important uh in game design for these sorts of games and we think that uh one of the things that we're going to be probably doing eventually along with the mutable x is probably like starting to open source a lot of the game and economic design documents that we have around this so in god's unchained some cards sell for a huge amount of money some cards sell for almost nothing how do you make sure that you are not just directly selling power uh in a way that's perceived as unfair by players in a way that will ruin their enjoyment or hinder the growth of the game there's a couple of ways one people won't only just pay for power

so people will pay for status and in god's unchanged what we've done is make sure that you can buy uh you know there's shadow versions of cards golden versions diamond versions etc and that's ways that you can continue to spend and be appealing to people who want to spend by by offering them status rather than offering them an in-game advantage at the same time as items become more and more unique you need to make sure maybe you can offer new experiences uh maybe you can offer extra content and extra experiences but you can't offer something that is strictly superior or it just erodes people's sense of fairness at the same time we've done a huge amount of work about how to uh

essentially make sure that we protect the economies in these games as well you don't want what happened to diablo 3 the auction house to happen to a blockchain game right where you have intervention supply people who just go crazy they're constantly making stuff we've done some amazing uh r d internally that we'll be releasing pretty soon for god's unchained i'm not sure exactly when clay's going to roll out the update for what we're going to do to the metagame for that but essentially how do you algorithmically uh bring in caps uh as well as other mechanisms which stop over inflation of supply while also making sure that they're dynamic they're

accessible uh we're pretty excited to reveal later what we've done on this front you guys are forging some new ground in these these gaming like monetary economics i think it's uh it's gonna be fascinating i think in the in the future for games to sort of learn from this experience um one question i have james when you were mentioning status is it has this become a thing yet so like tracing the lineage of a particular card or an item in the game so let's say somebody super famous like david hoffman you know owns this god's unchained card and i want that card just because david owned it has has that become a thing yet in the gaming world or do you think it will become a

thing in that step status bucket 100 that will become a thing so it has been hard to make it a thing so far because the infrastructure around truly unique items and searching for them hasn't quite been there and the liquidity around that hasn't quite been there either but what we want to do for immigrants and one of our big goals is be and this is why we would never compromise by switching to something like one one five fives or using something which is only semi-functional you need to be able to create completely unique items it gives so much value to influencers content creators streamers etc what we would like is if you are playing god's unchanging you're a streamer

and you have the ability to sell your cards right there through a mutable x through that streaming platform and because immutablex is apis uh like we could build this or one of the listeners if you're a developer chat to us go build this like we we're fee sharing we're you know cutting people in all participants who build on top of this will uh prosper essentially it's the way we're designing this protocol um and ultimately the ability to empower this captures something that has never existed in the digital realm before so the boxing gloves that muhammad ali used to knock out george foreman in the rumble in the jungle fight they're worth over a

million dollars the exact same boxing gloves from that same year made by that same company that were not used in that fight they're worthless who captures that value in the gaming world there's no value to capture who could capture that value how can we incentivize and allow the people who distribute it there to tap into the power of their own celebrity influence uh the values that they're bringing to it and capture value from that and that's something we're very interested in empowering people to be able to do this is super cool another question coming from youtube when is god's unchained coming to mobile

so god's untrained mobile like i don't want to uh be a little bit of a uh a big tease but i have a version of it on my phone right now that is a tease in terms of there's a couple of things we need to get it to the level that we're happy enough with and then we're gonna do a soft launch with it um in a you know we're trying to work out is it going to be australia is it going to be uh canada for the soft launch uh essentially the goal is to have this soft launch in uh q2 of 2021 uh for us uh like we've been chatting a lot to the big you know the apples the googles and everyone to make sure that we can make

this uh like properly so it doesn't get pulled making this mainstream for us is not something that we want to rush it's something that we were going about 100 seriously and intentionally and making sure that the mobile game is a good game matters well there's been all of the uh the fortnight apple kind of news lately i'm sure you guys are paying attention to that that was a crazy and ballsy move by tim sweeney when he decided that he had had it with apple's monopoly and ultimately uh like i guess one of the beauties of crypto is that rather than taking the monopoly for ourselves we get to share it we get to not only share it we get to

programmably share it and when you you know when the code itself that programmably shares stuff and increase value is immutable then people that's the foundation for which the new economy is going to be built on james one of the frequent topics around nfts and gaming and specifically inspired by gunslinger chain is the ability to rent out your cards or rent out your deck are you guys working on infrastructure like this as soon as we have so our main goal by far is liquidity so the ability to be able to sell any card pretty reasonably without much slippage that's our number one focus for the immutable x platform at the same time our whole team wants to be able to allow

uh lending and after that you know collateralization futures all these different parts uh it is firmly in our vision it's not on the roadmap for the next six months that is get this like get this amazing exchange protocol up and allow and really stoke as much liquidity as we possibly can as we keep on improving it but after then it is extremely interesting to us what about on the defy side of things have you guys chewed on the ability to produce a and gauze unchained cards index like maybe gaz unchained gets really really popular and but maybe you don't really want to spit by specific cards but you do want upside exposure to the growth of the overall set of gauze unchained cards is it possible to

produce a gauze unchained index token i'm not sure who's been uh speaking within your ear but that's another another feature that we are super excited about so look why are we excited about it if we can allow people to create indexes for any sort of bundle of items that they want inside immutable x and we democratize that to other people being able to create it then suddenly erc 721s can be kept within immutablex and you can turn them into erc20s which represent you know fractional ownership or of this index and at that point pulling them out and interacting with the rest of the d5

ecosystem one it's already built for erc20s two the gas problems just aren't as bad for erc20s and so we see an eventual strong use case of uh immutable x being the place where everyone with whatever game can turn their fungible items into a collection into an index and allow people to be able to create erc20s out of them that can be interacted with the rest of the interoperable d5 scene what about getting even more granular because i remember back in my hearthstone days uh there were when a new deck would come out people would be hypothesizing or guessing like all right well this new this new expansion pack that's coming out that's going to be

like this and that's going to really impact like drood characters drew decks or or priest decks could we even get even more granular what if we had like a i'm not too savvy with the categories of types of decks that immutable offers but like we could have like you said deception a deception etf specifically in that category versus other things that that sounds like if the ecosystem grows that large to need something like that it could be pretty pretty interesting completely um when i say the that like our goal is to have goldman sachs going long deception and all the wi-fi is uh doing that this is the tool that i imagine that they would use at the same time

in a way we have a product actually which is uh like chests of unopened cards uh in a way that's like the basic primitive of what these indexes could be there's a level of randomness in there obviously because you don't actually know that it's not one of everything it's just a probabilistic chance of a certain amount of each one but for us that's a primitive and that we're learning quite a lot about and then uh eventually we get to upgrade it to just being create your own indexes let's see which ones are popular how can we offer allow this to give value to people very cool very cool one last question i have for you is what's the business model of the immutable x platform so essentially uh it's going to be a

small fee on the sale and trading of items uh it will always be less than which is beautiful um it's going to be less like the the cost to create something for all devs uh will always be less than what it would be to mint it on the main chain super important to us so this like percentage has a cap on it and we i'm pretty sure the cap is 10 or something so if you want to mint a currently it's incredibly uneconomical to create anything on the main chain i think the gods and chain packs for us to create on the main chain and the cards is just stupid um because the average value of each of them is you know a dollar or a couple of dollars etc but there are some items which are

incredibly rare and some items are worth 60 a hundred thousand dollars uh it will be cheaper to mint them inside immutable acts as well james this has been a super cool ask me anything i think i think a few things that that i guess i'm hearing one thing i'm hearing is you guys are essentially creating a shard for nfts right a shard on top of ethereum that anybody who has an nft whether it's wearable or whether it's an art project or whether it's another game can come join and the beauty of this is it's credibly neutral right like it all ultimately settles to this open financial

property management system that that we call ethereum and what i really love about what god's unchanged is doing is you guys are playing the long game i look at the the crypto uh gaming industry and i see a lot of games that quite frankly are just playing the short game and they're chasing kind of money whether it's like uh selling to their community in a way that is very short-term not thinking about the long-term economics or just jumping on the next ethereum killer that bribes them with some easy cash or some press right you guys are not doing that you are playing the long game you're building a home here uh and that to me is is super exciting but i feel like uh

there's an element james where like you've been wanting to say some things about your upcoming product roadmap and we want to hear what's coming next with god's unchanged is there anything you can say to the bankless community about what is coming next because i feel like you've got some exciting things in store so i've hinted at these a little bit and i've got to make sure that i don't say anything that the marketing department is going to get me in trouble with but obviously immutable x is going to be a game changer for god's unchained uh the ability to be able to trade these items gas free is going to be huge uh and instantly as well so

building that out and getting that integrated with godzilla chain uh as best we can is one of the most important things the next thing that we're very interested in is making sure that our metagame one can delight and you know gives the traditional free-to-play experience and all the best parts of that but takes advantage of immutable x so we are very very interested to make sure that uh sort of our metagame and uh like the upgrade to the economy that that's going to bring uh and the huge upgrade to play to earn that that is going to to bring uh makes it the best advantage of immutable x and the other learnings that we've had in the space over time so a couple of

the learnings that we've had were we did a uh we've had raffle tokens before that people could play to earn uh which were erc20s we've had uh you know versions of erc 721s and nfts which people could play to earn uh the the next version uh which brings it all together and sort of the culmination of our learnings and we're making sure that we have at the same time as immutable x is the one that we think uh is going to be incredibly fascinating for god's unchanged and where the team is super excited by it we've been calling it project rocket internally one thing i've noticed about uh gaming platforms on ethereum and most saliently god's unchained is that the

community that you guys have developed is actually uniquely different from the d5 crypto community that i find that me and ryan find ourselves in every single day and that that's one one reason why i find crypto gaming so incredibly compelling as an on-ramp to get people who are not crypto people to become crypto people you know yeah you know poland is like the the white van with candy in it except now it's just that the the hearthstone remake with whoops you accidentally bought a like self-sovereign game item what does that even mean like oh this has real market value you know all the other things that make d5 so incredibly cool can actually be expressed inside of hearthstone or of gazan chained and like i'm actually i'm seeing the very vibrant gauze unchained

community in the youtube comments and so they've definitely followed you here biting on your every word to hear about what's coming out of immutable necks and so tip of the hat for generating that very unique and compelling community outside of defy because that is not an easy challenge sir well the tip of the hat goes to the gods unchained community rather than to us essentially if if you build the infrastructure and you continually focus on the long game and keep on trying to deliver value then uh communities who are interested in that gather and they form their own culture these are the economies of the future aren't they i i really believe that so james if uh people who are not yet in the gods unchained community where

should they go to join it or just to overall find out more information about ghaz unchained and immutable and immutable x awesome so for information around god's unchained godsendchain.com for information around immutable and immutable x immutable.com uh you can download the game godling chain for free if you're interested uh there's less tutorials you can start earning cards you can start earning items and get eventually you know uh this stuff is all going to be on immutable x so you'll get your first items uh your first self-sovereign gaming items uh and you can earn it that way all right guys you heard the man meanwhile since so many people who are watching this are new make sure you like and subscribe the video we put out a ton of d5 bankless content all the time just

like this and so if you subscribe you will get notified of that future content so make sure you do that and also with gauss unchained one last question is there social gaming yet can i play like can i connect to a specific friend and play him because i know my gauze unchained username so like is that can i like add a friend is that a feature yet so we haven't built the friends list inside it that we have built the ability to directly challenge uh and essentially have a 1v1 against whoever you want uh and i think you mentioned that you were playing maybe a couple of months ago so this one's new since then and it's had really good uptake okay well my username is trustless state so which is also my twitter name and so the next time i log into god's unchained uh i will be

spamming out that that username so people can challenge me awesome all right guys james thank you so much bankless nation this has been another ama on the bankless nation like subscribe thanks for joining us take care thanks everyone