GAMESTOP Partners with Immutable to issue NFTs!

3 Feb 2022 · 35:26

Robbie Ferguson, co-founder of Immutable, joins Bankless hosts Ryan Sean Adams and David Hoffman to discuss GameStop's partnership with Immutable X, an Ethereum layer 2 scaling platform for NFTs, to power a gaming NFT marketplace. He explains that Immutable X makes NFT trades free of gas fees while relying on Ethereum security, and describes a $100 million fund in IMX tokens for game companies that build on the platform and sell through GameStop, with a goal of more than $3 billion in NFTs traded there within two years. He favours high-volume, utility-driven game items over expensive collectibles, citing Gods Unchained, and says NFT gaming still has to prove itself with a mainstream hit.

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hey guys welcome to the live stream this is ryan sean adams i'm here with david hoffman this is an episode we generally don't do but this news is so big we felt like you deserved a live stream you deserve a live stream with this kind of news okay because this is you know two of our favorite actually three of our favorite things so we've got gamestop on the one hand we've got immutable which is layer 2 ethereum layer 2 technology and we also have nfts and the confluence of those three things because gamestop and immutable just announced a partnership that we are about to dig into today david are you feeling excited about this news man dude absolutely there is this seemingly growing trend towards uh a game gamestop has been circling around gaming nft type

gaming for a while there's been a bunch of speculation as to how they're actually going to do that uh and now a big piece of the puzzle to answer that question has been unearthed and so there's there's so many things on talk about not only are they using immutable to do to create their nft platform but they're also bringing a hundred million dollars with them to bootstrap the gaming ecosystem on immutable where is that where is that money coming from uh we're about to find out uh so we're gonna bring robbie the co-founder of immutable onto the show right after we talk about some of these fantastic sponsors that make the show possible slingshot is a decentralized trading platform that combines the performance and ease of a centralized exchange with the openness and transparency of d5 slingshot aggregates liquidity from all

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uh robbie it's like um is this uh is this gonna have repercussions across like nft across gaming across you know crypto what's the magnitude of this yeah i think the reason we're excited about this is gamestop in addition to having such a core part of gaming history and legacy is also one of the most fanatically empowered fan bases in the world right now which is what crypto is running on right like that's community it's incentive alignment with people rather than power going to companies and so i think they're in a very exciting position to launch an nft marketplace aggregator for gaming and sort of pivot the company into that space they've built an incredibly credible team

lots of crypto natives and we're really thrilled to help power them with the fund as well so our goal is it to be very large i think the other thing is we're seeing really large games companies be interested in the space but they're not fully committed yet and so i think this isn't a really interesting place where you have like a fortune 500 company actually going all in in trying to build a you know an nft marketplace and truly work with long-term play-to-own games we're going to unpack all of this with you robbie but i feel like this is sort of a convergence of two communities right so we have kind of the fnatic fan base of gme and gamestop on on the one hand that uh are analyzing this deal and have been looking at gamestop uh for

quite a long time and then we have the crypto community on the other side which is like you know a a different world altogether and these two communities are kind of meeting at this at this intersection point with this this partnership between gamestop and immutable and i'm wondering if it's just worth it to talk to both communities right because there are some people on the crypto side who might not be as familiar with gamestop and what they're actually doing and there's some people who are coming from the gamestop side who want to learn more about immutable can we just talk about those two camps for a minute so what is gamestop doing in uh like in general what has their strategy been uh talk to the crypto natives for us first and why

they're an important company to partner with so gamestop is a incredibly you know historic legacy brand in gaming millions of people around the us all remember buying games from gamestop as a kid and their favorite experience is going in stores and obviously a couple of years ago we had this um massive community following of gamestop where um people became obsessed with sort of creating the new version of what it could be and i think they've done an exceptional job in figuring out where should we go next and an nft marketplace which can capitalize on that cachet and probably the most rabid fan base in the world right now for any company is an exceptional move by then so we're

really excited to partner with not only their kind of historic 50 million customers and but also this this new vision of what they're building and it's not just you know a sexy headline they built an incredibly incredible team they built a large amount of full-time staff working on this project um and they're working with what we think are pretty good people in the space like ourselves so i think out of everyone to work with powering one of their nfc marketplaces i mean obviously you know we we work with every nft marketplace under the sign we're talking to most people right now if you're one and you're watching this right now please reach out and but we're really excited about the distribution that gamestop can bring and also their relationship with massive publishers and games companies around the world okay let's talk about the immutable side then

so for somebody who's from the gamestop community's never heard of immutable what is immutable and they probably in this press release saw some other terms like layer 2 and maybe starkware and some other terms that maybe didn't make sense what is immutable and can you talk about what this means for gamestop so immutable x is an nft scaling platform and it's built on ethereum which is the most popular blockchain and has the vast lion's share of nft train occurring on it what we do is we make any nft trades cost zero gas or transaction fees to use typically these will run up to 50 to 100 when a network is congested we also make it completely secured so you may have

heard about 600 million bridge hacks this year in fact there was one two days ago that blew up on twitter there's been massive vulnerabilities with side chains or alternative layer ones we use ethereum security and that means it's very very difficult to compromise users assets we're also completely carbon neutral and this isn't just a tagline we're not just paying a huge amount of money to carbon offset the reduction in carbon footprint is drastic more than 99.99 because we compress what we're using on the ethereum blockchain we use it as a settlement layer and finally is we're specifically designed to bring liquidity to high volume projects so really the nft market has been dominated

by luxury nft sales over the last year the bulk of the 23 billion dollars in volume was expensive jpegs like board8 club uh or crypto punks we think they're exciting but as a company we are focused on the democratization of digital ownership so how do we take items inside video games and instead of having players just collect them over five years be able to trade or sell them like you would if you bought cards in real life and the same for other verticals too and the best example i can give here is god's unchained which is one of our trading card games has more than 22 million nfts which is more than every other ethereum game combined and the average trade of one of those nfts is two bucks and that's what we're excited

about is not expensive ridiculous sales i mean they're cool and they're exciting because they show the power of like digital art what we're excited about though is how do we create true long-term businesses where players or users buy and trade this stuff for their utility reasons uh and we make that incredibly accessible every time you trade on a marketplace that order shows up everywhere so we operate as a global liquidity back end and adding on gamestop into that distribution means that every game developer or user who trades with us now has game stops marketplace is another venue of distribution um so we're really thrilled i think this is a fantastic like landmark or turning of the page for for gamestop and really one of the reasons why gamestop has this massive following

this massive energy behind it is because of the story of what happened to gamestop during the covet crisis and what happened during the kovac crisis was that a bunch of hedge funds decided that physical brick and mortar businesses are just not going to make it and so they they tried to short gme into the ground and then that created the this possibility of the wall street bets types to really like steward the populist side of game so i was like no you're not going to short our company to the ground we're going to short squeeze you and it has turned into this massive narrative behind the the citadel hedge funds versus the the stimi check you know apes who all need to ape together and it's turned gamestop to be this like symbol of of the people while at the same time covet was

happening and the leadership around gamestop was like yo maybe the brick and mortar route is not actually the route for the future maybe we need to get into the metaverse and this kind of seems like the headline it seems like gamestop gets into the metaverse using immutable and that see this partnership really seems to be about like really showcasing where gamestop really thinks the future is and the future is using nfts and cheap nfts and many many nfts enabled by immutable to really start to open up these digital virtual worlds that we all know are coming we're just waiting for companies like gamestop to build them and they're using immutable as the back end to really start to to build out uh their

new business model right that's my take on like this the story of gamestop robbie do you want to add anything to that that story or how do you feel like i did with that one it's a it's a brilliant summary i think the game stops team is now very visionary i think they've got a great set of executives who know where they want to go and i think they also have a very credible technical team building this marketplace so uh we're pretty excited to to partner with them on this journey and i think that when you look at the power of web 3 you've got true ownership and the other big value prop is incentive alignment which has never really been before possible at this scale and that's all companies do they organize individuals to achieve a common goal and a community

incentivized by a common goal of creating an nft marketplace which can be fueled by the power of play-to-own loops and tokens and web-three-designed communities is going to be one of the most powerful entrance to the market that we've seen so i think we're seeing the merging of one of the most rabid fan bases in history and an incredibly evangelistic fan base incredibly switched on fan base with something that can turn all of that into true value and market share so we're pretty excited so immutable and immutable uh x is it's not the only nft marketplace it's not the only nft backend that gamestop could have chosen so why did uh what about the properties or features of immutable x what in your opinion were the reasons

why gamestop decided to partner with immutable x like what is unique about immutable x that gamestop was like uh yes please so i think there's a couple of things the first is our focus on gaming so immutable is really as a scaling solution focused on nfts obviously that's why we're dedicated to if you want to build a complex d5 protocol go and you know use something else like that's not what we're focused on we're focused on making digital goods accessible to businesses and that means the apis we use to allow you to build on us are ridiculously ridiculously easy to use and i think that's incredibly significant for games because they want to come in and make something easy they don't want to muck around with smart contracts and they want to have an economy that is secure

and safe and we make all that easy to do so if you have a large brand like gamestop who's going to be pitching i mean when gamestop launched this thing the amount of inbounds they received from developers wanting to build was like insane and so we enable all of those developers to come and build something that's secure that's scalable that's carbon neutral most importantly without actually having to muck around with smart contracts the second thing is like our core focus on gaining means that we have you know a really really strong pipeline of people that we're going to work with so does gamestop and so i think collaborating on that and kind of working on the go to market side together um is part of the reason i think the third is we've been in talks for a really long time in mapping up this product for a really long time i

mean um by far the better half of the year so um this has definitely been been something we've thought through quite deeply and obviously we want to work with as many nft marketplaces as possible and i think gamestop is going to be an incredibly significant and trip to that market so robbie can you tell us exactly what's uh being built first do you think i mean you've been saying nft marketplace right um and there are of course so many different uh types of nfts um you know even even within the gaming sub sector of nfts there's like items there's collectibles there's cards there's you know skins there's things we haven't even thought of uh do you have any inkling on what gamestop is going to build first as part of this nft marketplace

yeah so this is i think why we're partnering right so we're working together on the go to market perspective is their you know default kind of gaming partner and our goal is really how do we get long-term gaming businesses and so to me that is how do you have businesses with negative chain that grow over time and for reference if you look at something like god's unchained volume it's not like a pfp which is like this it's literally a million dollars every day and that kind of consistency is important because it shows you're generating utility that is real you know user-driven demand and so businesses or gaining businesses that want to generate long-term businesses where the nfts are a core part of incentivization and growth loops are

what we're interested in and there may be collectibles inside of that within the gaming sphere i think it's a broad remit and obviously we're going to be assessing for what we think is exciting personally my two bets on what's going to be big this year are kind of high volume nft projects which use play to earn and share to earn loops incredibly effectively to grow the games um and what we're also going to see is the quality of gaming content just skyrocket because right now like there's a few nft games the quality generally is actually pretty low in terms of the games themselves and that's just because it takes a while to build this stuff they're like movies you can't build a good game in six months you know we've been building gods and chain for three and a half years now and and so we're going to see the quality

drastically kind of equilibrate to industry standard for what games should be and i think that will also help with the brand of gaming for major and and mainstream users right now um and the other thing i'm really excited about is ugc and unlocking meaningful economies because if you look at what nfcs are incredibly powerful at doing it's creating efficient markets around long-tail heterogeneous assets and if you look at platforms that have been most successful in the last decade in gaming they're ones that are open to creators defining the supply so roblox manticore like uh epic games and the stores which allow you know third-party creators to start attributing value minecraft which has been you know such a giant success story the microsoft

all of these platforms you can now create true player incentives for end players rather than paying them cents on the dollar and i think this is the general trend of web3 stop giant tech companies from extracting value while paying creators literal pennies and instead empower them to get fair prices for their assets where instead you probably monetize via secondary marketplace clips or owning a share of what the community owns and having incentive alignment as you go toward a common goal so i really want to drill actually down into the details of what gamestop is actually building does this make them something closer to like steam or origin if you're telling me that developers are coming to gamestop knocking on the door saying hey we want to build using your back end now like well what's actually

being built are they building just like the end like the virtual digital asset marketplaces for games that already exist or are they allowing game developers to come build on their platform to tap into digital goods like what does it look like what ultimately will this look like from the consumer or the gamer so obviously the game is going to come and you know build the goal is come and use the moodlex's apis which make it really easy to use i think that's what we're kind of bringing to the table is the ability to build an nft gaming business and have those assets distributed and traded via this massive nft aggregator so i'd say it's probably more similar to a looks rare fractal and open c um in in the early days and obviously the business strategy will evolve over time

okay so it's a place uh for those that uh aren't too familiar with looks rare or open c these are nft marketplaces that you probably heard in the news for things like board apes or crypto punks or you know insert your profile picture nft here but you're saying that this it could be an nft marketplace that is generalized for many many types of different games many many types of assets but because they're built on immutable they are probably more likely to plug right into games uh and so if you are playing your game but you're really missing that sword maybe you go to the gamestop marketplace to check out what stores are available so you could buy the swords there is is that prob perhaps the take precisely and my favorite thing about what we're building is we really view the future of trading as occurring not

only in these giant aggregators but also inside the games themselves because that's often where the best experience for a player to sell something might occur and the beauty of what we've built which is our order book that operates as a back end to each of our marketplaces we integrate with is you could be let's say hypothetical inside uh you know minecraft or illusion who we do work with and sell your asset that you earn by our platoon system inside the game which is frictionless and you're gonna hide all blockchain from a user and then have someone on gamestop say come and buy it from gamestop's marketplace because those orders automatically connect liquidity on immutablex's audible so um that's really cool as well robbie i hope you stick around uh

because we have a few more questions to ask you particularly about this uh 100 million dollar fund where some of these numbers are coming from there's an sec filing about this partnership it was that big and you can bet the wall street bets community has dug into the details of this right now yeah well we have some questions we're going to relay about those filings and the finances behind this but before we do we want to thank the sponsors that made this episode possible when you shop for plane tickets you probably use kayak expedia or google to compare ticket prices so why would you limit yourself to just one exchange when you trade crypto when you make your trades you want to make sure you're getting the best possible price on your trade and that's why you should be using matcha matcha has smart order routing that

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a 100 million dollar fund there's some token economics going on here can you tell us about that so where is the 100 million dollars coming from and where is it going what's its purpose so the immutable x token uh is where it's coming from and obviously if you look at the tokenomics that token the vast majority of that we are giving away or the foundation is giving away to community members who want to grow the platform and so some of that is through user incentives where every single person who trades on imx gets imex and the other is through business partnerships and so this is essentially us saying hey we're going to earmark 100 million dollars of that two games companies specifically want to build an

immutable lexus apis and platform and auto book and distribute via gamestop's marketplace that's cool i i'm going to pull this from the the sec filing as well so it looks like there's a 100 million dollar grant for what you said for you know nft content and the community and then also potentially a grant of up to 150 million imx tokens uh based on some certain uh milestones that the company uh would achieve and i imagine these milestones are um a gamestop type milestones and there's a number like the simple ones execute the contract and uh you know start launching this thing but there are some milestones around transaction targets i'm curious um what you know what these uh are about like what are

these transaction targets is there some incentive to you know increase volume on this gamestop nft platform can you talk about that 150 million yeah and the milestones yeah obviously our goal is to have long-term incentives for us as partners and the goal is within two years have more than three billion dollars u.s worth of nfts traded on gamestop via immutablex three billion dollars okay and i want to actually unpack that a little bit because um nfts on the ethereum l1 are not that that ecosystem is not really a high volume ecosystem it's a high value ecosystem because like crypto punks or like a quarter million dollars but uh immutable x is going for the other end of the spectrum it is really trying to

incentivize total aggregate just trade volume like how many trades uh and that makes sense to partner with games and gaming ecosystems because you know gamers do a bunch of transactions in their economies and so it's kind of a high volume uh fake digital world that's now becoming a real digital world because it's now becoming into assets on immutable robbie can you just go into the the business model behind uh the immutable x and why it's it really really wants high volume stuff rather than high value stuff of course so first off we like high value stuff it has a place on our platform if you look at the book games drop with garyvee we launched a few weeks ago there were you know over 50 million dollars of gmv in

the first few days there were hundreds of assets traded for tens of thousands of dollars many for hundreds of thousands of dollars those are awesome and our goal is to provide maximum liquidity so if you can't get the best possible price for your high value assets on immutable x we're not doing our job and that's why we built an ethereum is because it natively has that premium for assets based on its security liquidity and interoperability what i am saying that is in terms of our target customers we want businesses where there are going to be millions of users and within the context of those like low value trades there will absolutely be high value trades look at gaming you often have vast majority of revenue coming from whale customers but then the context of hundreds of thousands or

millions of people wanting to play that game and bring overall value to the ecosystem through utility driven demand and i think that's the cool thing we're obsessed with utility nfts we want people to be buying nfts for a reason whether it's to own land with utility or to use the item in a game or because of some awesome stream at prominence that's the stuff that's going to weather a bear market that's the stuff that's going to grow and that's the stuff that will be able to take us to a billion players so that's kind of why our target audience is core long-term gaming businesses and obviously immutablex is completely permissionless and open fit everyone to use we've had literally over 1100 people building our test environment that number was at 180 at november 1st and

the goal is to be able to allow anyone to build a successful nft business in terms of what we spend our active company efforts on we're very bullish on gaming and like long term high volume nft projects so i'm assuming there's a bunch of people watching uh this stream coming from the gme gamestop side of things as well as just like you know the trad gaming side of things as well who are perhaps hearing about immutable for the first time or just really learning about uh the possibilities of nfts with games do you have any recommendations for them where can they go to actually get their hands dirty in nft gaming uh with immutable do you have any like favorite games that you like to play that people that are trying to figure out what the hell this thing actually is that gamestop's building where can they go

get a taste of that yeah of course i won't be too biased to mention just immutable uh customers so obviously the big thing has been axely infinity last year was a major major game and paved the way for lots of ways people think about tokenomics god's unchained i think is the second most popular blockchain game in the world right now by players we have hundreds of thousands of weekly active users that's been growing kind of ten times every three months um which has been pretty insane um that's designed to be really mainstream so like your favorite trading card game it's ridiculously easy to use something i talk about is for the first three years of building this game we never even mentioned the word nft and we still don't if you go on godzillachain.com and the reason is the value of nfts should

not be hey you're using an nfc game it's hey you're playing a game that gives you more value that allows you to sell things that allows you to trade things and that gives you real economically meaningful guarantees and this isn't like look at history op skins which was a counter-strike go skin marketplace built on steam was a 300 million dollar company that was killed overnight because steen decided to shut down or restrict trade locks on assets people in eve online care so much about governance around the in on in-game economy but they send a delegation of 10 expert players every year to spend a week at the company's service servers guaranteeing what changes they're going to be making over the next year

we've seen time and time again how much people care about these economies like this is their lives and it's only going to become more serious and more meaningful and to think that that's going to be owned by a database or owned by a company like facebook is disgraceful we need to build true property rights and that doesn't mean speculative scammy nfts what it means is you play a game and at the end of two years playing it maybe you can sell your items or you can have fun trading with people for for low values that's when we're going to see true mainstream games grow and kind of be the trojan horse the crypto behind it yeah i i feel like this is why there's so much values alignment between the crypto community and kind of the gme uh gamestop crowd is because um it's all

about the little guy versus the big guy here right it's all about like individuals should own their own property rights we shouldn't be able to be de-platformed whether it's on robin hood or whether it's in like a game that we play um but there's still lots of skeptics out there and um you know we've used the term nft a lot in this in this uh episode so far and you said even god's unchained like we don't use the term nft it's just about individual like it's your property rights like true ownership is really what an nft means but what would you say to some of the criticisms why do you think there's some pushback out there in the traditional gaming community about uh nfts and how would you address that criticism robbie i think we have to prove ourselves i

think we have to generate a mainstream game that has hundreds of millions of players and you don't even know what's nft's under the void it's as simple as that i think talk is useful to showcase intent and what we're building towards but until we do that we haven't actually proven our value um so that's kind of my my short take one last question for you robbie uh we talked about this a little bit when we had you on for our state of the nation show a few months ago but the business development side of immutable is just absolutely killing it gamestop is just one of many significant companies that has come to be built on immutable tik-tok also comes to mind uh what's next what what comes after gamestop can you any other things that you can tease

yeah so we'll be launching many many marketplace integrations over the next two quarters uh obviously we've already announced our integration with openc which is actively being worked on uh we'll be working with many more major gaming partners as well um obviously there's now more distribution with partners like gamestop being added to immutable x so yeah i'm really proud of the bb team i'm also really proud of the product team because if you go into these conversations and you have a shitty solution you won't win them right like there are numerous dead l1 blockchains out there just offering giant buckets of cash to try and win deals because they don't have a solution that people fundamentally want to use which is why that number of 1100 developers building on our test net organically quadrupling since november

is so exciting because sure you can go out and pay heavy grants to win big deals it's much more difficult to build a developer platform that businesses organically want to use and that traction is what excites me the most this is awesome this is i think an exciting time to be in crypto exciting time to be in gaming as we see like these gaming studios being uh swallowed up by larger and larger companies the microsoft's of the world it feels like we need digital property rights in our games more than ever that's that's what the metaverse actually is it's not about mark zuckerberg's virtual world and some lobby you go hang out with it's about digital property rights and nfts immutable as part of that story and now so is the gamestop community uh robbie thanks so much for joining us on

bankless it's been a real pleasure man thank you both always a pleasure guys if you'd like this episode david and i talk routinely about crypto things nft things all things that uh we think are worth paying attention to subscribe to the bankless channel if you're watching this on youtube uh and uh hit the like button as well uh david anything else you we should say before we sign off uh well one of the things that has always made me really really excited about crypto is that it's just going to in infiltrate my life and hopefully make it a lot better and that includes the games that i play uh it's been a while since i've been a deep gamer but i really think i perhaps will get into it when some nfts and crypto economics make the games a lot more real

a lot more lifelike and a lot more fun so robbie thank you for helping build out a bunch of uh really cool environments that i hope i get to play with in the future well hopefully we can get you addicted again david yeah like david needs another addiction in his life guys uh as always none of this was financial advice uh all of these things are risky you could lose what you put in but we're headed west this is a frontier it's not for everyone but we're glad you're with us on the bankless journey thanks a lot hey we hope you enjoyed the video if you did head over to bankless hq right now to develop your crypto investing skills and learn how to free yourself from banks and gain your financial independence we recommend joining our daily newsletter podcast and community

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