The Next Wave of Consumer Crypto Applications | Analyst Round Table

Transcript

the stuff that gets me most stoked um is stuff that acknowledges that crypto itself is a game like a bigger game environment um and I think like Cambria is an interesting example um where you're like okay for for now there's just duels and bding but at some level that becomes like a different interface to how people can experience crypto as opposed to just having a metamask browser extension games like that become like a UI for the entire set of blockchains that we already use stuff to do um like you can do swaps and you can do all these other things inside of a game environment so when I think about it it's it's kind of like how do you extend the crypto as a game idea through other interfaces um that stuff is cool to me nothing said on zerox Research is a

recommendation to buy or sell Securities or tokens this podcast is for informational purposes only and any views expressed by anyone on the show are solely our opinions not Financial advice pachio Ryan and our guests May hold positions in the company's funds or projects discussed what's up guys welcome back to another episode of ZX research today I'm joined by Ben from seed club and Natalie from Bank crypto who also both run their own crypto podcast called liquid culture thank you guys for joining thank you for having us so good to be here man before we get started I I wonder if you guys want to give you a short introduction of how you guys kind of got into crypto and also like how you guys got started with liquid cure as well yeah sure so I've

been around crypto for about five years years I actually like to speedrun the story I listened to an xrp podcast while being a finance bro um sort of working in an international trade stuff so I was like okay this is going to be the future of banking um and then you know got pulled into eth pretty quick just parents are both start up people and the idea that you could build stuff on top of this as a platform um just sort of hit better for me than than the whole money set of use cases um and so yeah long story short u did a couple startups in crypto one in defi more on the nft and art side um and felt more at home on that kind of more culture side of the industry um and so yeah do a couple things one um is run an art nonprofit

called accelerate art um two is is work with startups uh that are more on the consumer side with seed club which is an accelerator um and three is this podcast that not and I just started called liquid culture um and yeah that's kind of a bit of the backstory yeah I amum got into crypto during Co actually a friend of mine who got laid off taught himself how to trade options on Robin Hood and he ended up on the cover of Forbes um from being becoming so successful from doing this and he was the first person I knew that like Made Real Money trading so naturally I was like where can I participate in this so I went on Robin Hood bought some Bitcoin and then you know as like some side

diligence ended up reading the white paper and kind of went down the rabbit hole from there um but defin def came in as a Speculator and then stay for the tech afterwards um and yeah just after that tried to just increasingly get more and more into the space ended up coming on to the Venture side and have been doing that for a little bit over a year and a half now so yes mostly working with startups trying new things also love you know being on chain as a user as well so yeah that's kind of my background the cover of Forbes that's uh that's pretty crazy I feel like we need more details on this story yeah his name is Taylor you can look it up it was uh 2020 he uh was trading airline stock options like around the time that the market crashed

and it was and all the airlines turn it went down it was absolutely insane and he still trades to this day he's like the nicest guy ever he donates like a bunch of his profits to charity shout out saor wow that's super cool he was Roy and kitty before it was cool then smaller scale yeah Dan you know what I realized we've kind of never done an introduction of you do you want to give an introduction as well oh man okay I'll take I'll take the opportunity I guess uh got into crypto first time full-time uh in 2020 I actually shot Jason yanowitz block Works co-founder a DM on Twitter he had a tweet uh that was like hey I'm at the airport something along these lines of hey I'm at the

airport I got time to kill like if you're looking to break into the industry shoot me a DM and there I was you know sitting at my day job in the accounting World accounting Finance world and uh I was just procrastinating whatever task I had was mass refreshing Twitter it was like boom 5 seconds ago saw this tweet pop up and I was like you know what what why I got to lose so actually asked shot him my elevator pitch and asked him if I was like a good role for what is now one of our you know our main competitors uh and he was like H we're actually building something and we're in the super early stages of it like let's hop on a call talk it through uh and one thing led to another and here we are two and a half years later walk

work's research is born and alive uh played like a pretty role in making that happen which is pretty cool and now leading out the the product and data side of what we do so um that means like building out our data platform what assets do we cover what metrics do we cover how do we display that to the user how do we communicate the value and importance of these metrics you know blockchains are just like Giant open apis in some way um tons of raw data turning that raw data into some like actionable Insight is is actually fairly challenging uh and we see uh picachio is going to get mad at me here but we we see uh like a lot of misuse of data and a prime example of that is like active addresses and comparing that between chains and they just it's it's hard to

tell meaningful stories with an abundance of data you almost get like too many uh too many potential insights and air quotes that end up meaning nothing and so it's become like my passion of like you know decide helping play a role in like what matters what are key metrics that actually provide value and how do you use these to like identify Trends and then make predictions about the future I don't get upset about the daily Act of users think I just think it's like everybody knows that it's not real and then yet here we are we got hamster combat T ton telling the world we got 1% of the people using our game I maybe you maybe we see that like the four of us on this on the screen and pro quite frankly a lot of the listeners

you know we don't really you kind of need like a prere to know what the hell is happening and being talked about on the show so yeah all of our listeners probably do but we go to like on board the next you know next even the next 100,000 people they're not going to know that it seems like that's a great stat because you come from these Web Two backgrounds with social applications for example that can track users and do track users and everybody knows like daily active users that's an important stat uh so when you get you know active addresses being called daily active users you just end up going down a road to false conclusions and I think it's less important for the people here today again because we all kind of have put these pieces together and more important about how do we tell those stories going

forward to not see like a bunch of idiots yeah that's fair I shouldn't have brought this up we're just going to get really angry about it again and talk about 30 minutes um let's um start off with what you guys are looking like what what do you guys pay attention to data day what's like your sector um I assume it's called like liquid culture nfts consumer apps and not only I assume a lot of your VC work is related to social apps as well actually I'm not sure so maybe guys can run through like what you're most interested in these days um cool yeah I feel like why I joined uh seed Club this year was to focus more on consumer as a as a general category it's

one of these words that doesn't mean a lot like it's hard to Define what exactly consumer means because the scope is so big but basically the way I think about that is just stuff that is not necessarily defi like that real humans are going to use um and so like there's a pretty broad uh scope in terms of yeah what that actually looks like in practice um but it's art and fashion and gaming and social and and sort of each of these categories where a lot of people have said hey crypto might actually be cool for this uh but we've never really seen something pick up or take off like you have these little ephemeral experiences right um through just like being obsessed with crypto land whether that's uh you know friend Tech or something like these these

fantasy top like you're having early signs of people starting to do different stuff other than just buy meme coins um but it's it's not quite there yet and so yeah spending a lot of time just like hanging out with Founders trying to figure out how do you build something that is real in in that consumer Lane yeah I um I wanted to let Ben go first because I felt like I might derail the conversation but I I was I recently made a transition because I was previously at another fund um until before I joined Bane where I was more so like having a generalist perspective and I was honestly focusing on like truthfully the whole space cuz I was the only analyst there at the time so I I had to take a wider lens and look at kind of everything now I've like narrowed my

scope significantly and I'm pretty much focusing exclusively on just sort of media as a category um and where that's going new business models around media new new um yeah really new business models around media um and so I'm almost exclusively focused on that at this point um I'm like almost like zoning out most of the even conversations that are happening on the Twitter obviously you have to you have to pay attention to some extent because you have to know what's happening around you but I'm like very sort of in a uh a whole a corner right now information wise awesome I want to I want to dive in deeper on both sides there but Ben going back to you first um you mentioned right

before we hopped on the call you're talking about SE club's demo day can you walk us through some of the highlights from that yeah totally so C Club runs these three-month cohorts um in this case it was nine startups kind of for for that whole window of time uh and the culmination point is this demo day which we actually had yesterday uh there's a good recording it's basically five minute pitches for each one so it goes pretty quick if you're interested in startups it's it's definitely worth looking at um and yeah we had I think more than 7,000 people come and listen into that uh which is crazy um unclear like I don't think that was synchronous I think that's total now like after the fact 24 hours later right but um just cool to see a bunch of these teams work really hard

uh and then compress like their whole company into five minutes right because it's so hard you get very close to your problem and being able to tell those stories can just be can be tricky um and yeah I mean it it kind of spans a lot of different categories there's some sports stuff there's like tokenizing real life um there's you know NFC chips there's like I don't know I mean it's a pretty intentionally eclectic uh group of people and teams but all people that we think really have a a a shot at doing something that people want to be part of um and yeah so that's kind of the Quick Pitch yeah I I want to say just like yeah shout out to the seed Club because I feel like they are one of the few places in crypto that like intentionally

allows for like The Eclectic stuff to to have its its place um and so yeah I just want to give them a shout out because I feel like that's much needed in our space what was one of your I don't I guess maybe don't pick a favorite here but what were some of the uh the most exciting pitches that you heard maybe on a a lane that um something like new or novel that maybe the market hasn't seen before specifically as it relates back to demo day definitely I don't know about for you Ben but definitely for me there was one project that was innovating around the this like Vision model they had they had built that sort of allowed you to create like IRL

games um it's you have to watch the demo for it to like really click but it's they're kind of pitch was you know we spend so much time online as it is like why not just gamify real life and and make that more immersive um so that demo if you guys I recommend watching that that kind of blew my mind a little bit because it was a it was a mix of like tokenization and like AI you know Vision model Innovation like there was a lot sort of happening technically under the hood um so that I thought that was really sick personally totally that one was called side quest um and they're yeah they're kind of working at this intersection of computer vision and crypto where you think of like Pokemon go and and being able to interact with the real world in some way um but adding

tokens to different like activity Loops um so you could literally have touching grass burning you a grass token is like a stupid example right of of just how these things work because you could prove that hey oh look look I'm touching this grass um and it's it's more just conceptually cool like for anyone who's spent a long time around crypto it's just taking the stuff that we love to do on the internet and pulling that into real life um but it's a little bit trickier for me to to pick favorites obviously just working with all these teams but I think um everyone in there had an angle that uh I think people who really follow crypto closely would find interesting yeah I felt bad asking that question halfway through I was like ah I'm not trying to make you pick a favor here but it's cool it's cool to see uh

it's just cool to see like the innovation in that types of of uh business lines we're seeing in crypto right like um another like semi silly example that I recently came across was baxis who is like bringing the wine and spirits Market on chain which that's kind of like going the reverse route of what you just described right we're taking existing assets tokenizing them bringing them onchain making deeper more liquid markets that's kind of the goal uh versus what you just described is super interesting because it's kind of taking the onchain experience and bringing it into the real world that is actually something I spent no time looking into but will be at the top of my list I wonder how you um I feel like this is something that we don't look at at all then like I you had the backx interview um sem I related to Consumer

crypto but like for me I feel like my consumer crypto lens is so deteriorated now I just I'm not sure but I kind of want to understand like how you would even approach kind of taking that and as a VC like okay there's a cool lens to it like I'm interested I watched this chipped one for example which was and I thought it was like genuinely really cool but how do you view that from an investment point of view I I mean obviously like depends on what how much you guys can share about this process but kind of want to understand how you approach it yeah I um I think there's there's a lot of different ways to to go about that I think the way I think about something

like that when I look at chips specifically is like I think there's a thesis behind that about advertising and referring and distributing and that sort of behavior going P top and I think you see a lot of people building sort of Primitives on top of that like I would say Zora's protocol reward is actually a similar idea um there's other people who are building similar things in different verticals and so I think the question there is not necessarily like how can you you know build a wall Garden at the protocol air but how can you build you know a real incredible delightful user experience and I actually think that's why it's interesting that they have a hardware component even though that's hard to build because that is something that is more of a you know could be more

of a technical mode around it in the long term it's it's it doesn't scale upfront but think that that's interesting but that's like when I when I look at something like that for just to give like an example that's kind of like where my mind goes as as a BC if like you know how I could potentially break this down you know into something that might be investable and when you say Zora there were you just meaning like how I think my understanding is that the the content creators themselves actually get a fee split with the chain yes like the idea that you could sort of create a an incentive mechanism within the the the protocol or that within the assets that allows people to be permissionless compensated for their distribution no matter how small it is and and that that doesn't require necessarily a platform to be measuring

you know what your distribution is or even defining what that is like if you post a mint link on foraster and 10 people mint that you just get 5% you know rewards permissionless and so that idea you see you see showing up as a perative in a lot of different places whether it's you know fashion referrals or recipe referrals or you know gaming referral r s you know name your name your vertical yeah I think I'll jump in and say that the lens that that we use at C club for the most part is just building something people want to be a part of um and it's it's interesting even just to set SE Club aside for a second we've we chatted with wob from sappy seals um Natasha from boy club on rpod um like these are kind of upcoming episodes even smoovie from sunko uh and

you think like they're all building stuff that people just want to be a part of it's not necessarily that the tech is that much better than the next thing or that the nft is that better that much better that much cleaner it's like okay how do you get these people to want to be a part of something and then we can build from like the base of having people who are super fans and so I think something like chipped is interesting because you're really in a lane on your own right when he's a special founder you end up with this kind of like it girl crypto brand and you can build networks around that there's like the physical component there's the social component um you can expand Beyond Just Nails right and so I think a lot of it is just like this is a special thing

that people want to be a part of um and it's a little bit you know fuzzy sometimes but some from a VC perspective anyway like sometimes you're just betting on a Founder um and that qualitative Lane of like can they do something that people want to uh be a part of yeah and to Ben's point I think part of like the hard part as an investor is being able to like see the bigger Vision in something that could look like a toy up front because I think a lot of people look at that and they're like like nails like you know but like there is there is there is like a whether you buy into it or not there is something else that could be underneath that so I I I totally agree with that I think that that's what people are trying to do with something like

that yeah I um I want to talk about something you mentioned Natalie which is I guess distribution channels and getting a fee of that I feel like that's such a like clear narrative especially but it's it's a clearer narrative than I think a lot of other stuff has but I've been focused on gaming over the past week and gaming has no clear narrative I think it's like really struggling because the cool gaming like the interesting gaming is fully onchain gaming it's not like slapping a wallet on something or putting nfds on chain but that is people it's just difficult to make Gamers care about it I think but I feel like be sharing is a lot easier but on the other hand I guess before I

joined crypto I was kind of like really against financialization of everything but like as you're in crypto you're like everything will be financialized but do you guys like when you see some of these consumer apps do you ever feel like uh I don't know if this is necessarily A needs to be financialized apart from like obviously stuff that doesn't have a fit I am I guess the way I think there's like two ways to approach that I think one way I think about it is that if we're being honest with ourselves I think social media and the consumer experiences online are all are are already highly financialized in a lot of ways we just don't actually see the revenue from that like Instagram is a mall in a lot of ways we just don't

actually really reap any benefits from that being the case or the fact that it's such a money printer on on the advertising side even though we are the people that create the content and the distribution in many in many cases that creates that so there's like one side of it where it's like it's already kind of like that so let's just let people participate in it I think the other side of it though is that I think what's so so powerful about the nft As A Primitive in a lot of ways is that media for a long time at least has had to be commoditized to become valuable and so the idea that we can have these things that are that don't have to be commoditized to sort of have their value be legible to a market um is a really interesting idea um and so over time

I've come to see it more like that and less of like oh it's bad to financialized and so I'm I'm more there's like a lot of different ways to do financialization there's like you know there's Zora there's pump. fun there's friend Tech but I don't think it's a bad thing like with large I wouldn't say Pacho you mentioned something interesting there which was uh you're like sort of your gaming thesis which you alluded to saying that the cool gaming is only onchain gaming one I want to get you to like paint that picture for us a little bit better and then that and Ben I'm curious what you guys think about gaming as it stands today I um yeah I this is this has been very difficult to explain and which is why I've been working on the reports for

so long because there's like technically non fully onchain gaming is as an investment it's better because it's easier to build it's there's less like it's more similar to the traditional gaming flow um because you only have to do a few clicks but with onchain gaming especially at its current stage it's very difficult to the point that it's almost impossible to build like a complex on chain game but last time that I did this with with another analyst with brick I mentioned that it has a Vibe but it's very difficult to explain the vibe but it's like the people building fully onchain games are interested in building games fully onchain and that's all they want to do like they're nerd sniped they want to

spend weeks and weeks building random stuff they want to one story that was really I opening was uh I can't remember his name but he went on stage at the fully onchain game convention and he basically spoke about how they were building these 2025 people engineering teams to play Dark Forest and which is an onchain game which is and it's like very it's not particularly good um but they were like super into it and building like coinbase engineers and stuff they were building on top of this game that just for the money obviously for the money but also because they were genuinely interested in it and I feel like that's what fully onchain gaming attracts versus semi onchain gaming it's like okay like we slap an NFD on it we

raise however much money we can raise and then oh there's a token three years you have to wait for the game to actually be live but it's coming guys don't for like don't threet it's it's almost there it's like it's a completely different developer Community is a better way to put it than Vibe but that's just my fault yeah I am oh man I mean I'll preface this by saying I'm by no means a gaming expert or no I have no level of like real depth in this category as far as crypto is concerned but I will say conceptually I'm definitely nerd sniped by fully onchain games like for sure I I totally get that whole story narrative and I

would like to see that exist in the world and I think it will um and again like I'm saying this without a lot of knowledge to me I'm always interested in like leaning into the stuff that we can't really do without crypto like exploring the block as a medium so for me like that's always going to be the much more interesting stuff the hybrid web 2.5 like more Trad stuff is less interesting for me personally but you know I'm showing there's people building viable businesses in that space as well so yeah I think the way I look at it is there's a bit of a barbell um you know you like the extreme onchain uh game stuff like the Realms people coming out of loot uh some treasure things like there there's an early crypto Nerf type

of hey we really want to do something that's medium specific here and then there's the AAA like in theory parallel would be a good example there um right or or the pirate people who're like cool we want to build like a very serious game here not that the UN people aren't serious but you know what I mean the scale is is a kind of different conversation um and I think it's so hard that's maybe my headline comment of just gaming is hard um in either of those buckets right where most stuff dies like both most of two of my childhood best friends actually are game designers um and like 99% of stuff dies and you just like see it in their careers and I don't think crypto is any different I think it's just like it's got some cool

potential to do some other things like You're extending what gaming means uh but yeah this stuff is just hard yeah I um that like games are genuinely very difficult to the point that you either have to attempt to build hits and take the 99% like rejection SL failure or you have to build like there's Subway Surfers and then there's like yeah Metro runners or something you have to like repeat these similar games um but I don't know I've I've become disillusioned with it now this week I think like I'll add one extra thing and just say the stuff that gets me most stoked um is stuff that acknowledges

that crypto itself is a game like a bigger game environment um and I think like Cambria is an interesting example um where you're like okay for for now there's just duels and beding but at some level that becomes like a different interface to how people can experience crypto as opposed to just having a metamask browser extension games like that become like a UI for the entire set of blockchains that we already use stuff to do um like you can do swaps and you can do all these other things inside of a game environment um so when I think about it it's it's kind of like how do you extend the crypto as a game idea through other interfaces um that stuff is cool to me yeah like the crypto the game experiment was I thought was really interesting um I've few things in crypto

have gotten people that like revved up um over just like not just pure speculation so yeah there's some interesting stuff happening for sure we'll see I'm kind of giving up on it at least Natalie do you have any expanded thoughts on like the acquisition of uh crypto the game by Unis swap Labs like I'm I'm curious if you are trying to like piece back together their uh intentions there yeah their Visions right because you know they built an amm and now they're they're they obviously want to be more than this I think that's clear but uh yeah I'm just curious how you how you put yeah I I've thought about it I have been able to reverse

engineer it but I think it's really interesting and just like worth paying attention to like that that's like some kind of signal to me I don't know what it means yet but I was like I would just never have guessed that that really threw me off when I saw that headline yeah it does feel like they want to kind of get just get one step closer to that uh that relationship with the consumer and crypto the game kind of feels like yes it's a game but it also feels more of like this social media type play as well um and one thing you said earlier that I've been pondering since is when you fra framed Instagram as a mall the thing that jumps in my mind there is that uh you know meta doesn't want to give up the ownership of that mall so how do you think about the

push and pull between like yeah of course the users probably want ownership of the all as well but uh the existing incumbents kind of have this power and are you'd have to think are you know that they owe the uh the duty to their shareholders to not let it go yeah I think um I I guess my answer to that is kind of meta I think that crypto represents the sort of structural transformation to the internet that just eventually makes those business models unviable I think you just have to believe that that's the case um and I think we're like seeing that happen very very very slowly but I think you have to believe that that's like where this is all going um fundamentally before we move on to more conversation let's have

a quick word from block demon thanks to our fantastic sponsor layer zero all right guys for this week's layer zero segment I'm joined by Andrew senior director of blockchain engineering at block demon thank you so much for coming on yeah no worries um just to kick us off do you want to give an introduction on what you guys are building building over at block demon yeah sure so you know block demon has been around for around six or seven years um you know we started out as an infrastructure company RPC you know full nodes archive nodes um along the journey we kind of moved into staking um you know as part of that we then started building data products and backend Services um some of those we've offered up to our customers like you know um staking reports and all this sort of stuff um in the last year the the team

that I've been working on mostly is kind of an innovation team we've been very much looking at what is onchain how can we tap into that um you know we see the advert of layer 2s and and the proliferation of you know evm um so you know we're kind of thinking into the future and Building Systems that can you know um serve our customers maybe in a year's time where all of this is kind of interoperable so you know really looking forward to the the kind of next iteration of interconnected blockchain technology perfect and how does layer zero fit into the product yeah well you know if you think about the future where everything is pretty much interconnected kind of like we have with the internet um layer zero you know is building kind of a technology platform that allows for messaging to be sent across these

different ecosystems um so you know really what what we're doing with the the layer zero technology is you know when we look at our wallet and we see that we're adding all these different chains You could argue that they're still isolated right um but if you have a technology like layer zero with you know it's it's MES passing technology we're able to move assets around the different chains in a very trusted way um and then if you you know expose that and build those capabilities for our customers for instance in our institutional or in our retail wallet then you know it it's it's kind of it's a natural evolution of our stack and and the the technology that makes sense um do you have any exciting developments coming up over the next six to 12 months yeah sure we' have a couple so you know we're we

bought an NPC company a couple of years ago and and now we're kind of you know doing stuff with that technology right so we have an Institutional wallet that's on Prem um you know we're adding a lot of the the blockchains that we already support um and then we're also adding you know defi Integrations into that that allow our customers to basically transact on chain so you know we have um a lot of uh um interesting stuff coming out over the next couple of quarters mostly with uh you know onchain um cross chain swaps defi um yield all all these sort of things all tied up into our our Mobile wallet and our and our institutional umam wallets perfect thank you so much for joining us Andrew what's the best attempt that we've had for social F now forecaster for social social F

specifically like like a more financialized thing than foraster or including that I guess I just I use social fi and social apps related to crypto interchangeably we can do either I mean yeah I I it's hard to say what's beat that at this point um especially like Ben and I were were both that farcon um out in La not too long ago and like being able to see the community in real life as well like that's that's a real Community we can talk about the Bots and like of course there's Bots and you know that's a thing but that is like an actual community of people who are there and care about it regardless of price up or down um and like stuff has happened there people are building followings audiences businesses so that's probably like the the most real

foray thus far yeah it's a small space ultimately I think that's the the main conclusion right now um forecaster is cool lens is cool um I'm like sympathetic to frch and fantasy top and these more kind of like hyper financialized games but if you look at the user counts it's like how many people are really using these things right you can roll like a college hackathon app and have more more users than most crypto products and so for now it's kind of like I am stoked that people are experimenting with this stuff like I like the idea behind a lot of it um but you know to me none of it really has broken out or it's like that vitalic tweet from whatever that was 2017 have we earned it right it's like we haven't

really earned that category yet like there's there hasn't been anything that really has crushed it uh but I'm optimistic I just want to say it out loud because this is the sentiment around social F right now is why don't people realize that social f is a grift and there is no reason to put this on chain zero value question mark and I think this is kind of ridiculous first of all as a take but also I think CT is this is one of the things that I I think about quite a bit is like there's people who just kind of want to have fun um and then there's people who are like I need everything to be hyperf financialized which is fine both sides are fine but the hyper financial side never sees

value in this like the people building cool stuff and the other one also kind of looks down on the other one so I'm I guess it's a long-winded way of saying like why do you think this take happens about social F about gaming about consumer apps about every that is not hyper financialized or defi yeah my first thought there is like okay so time. fun recently hit the market um which is basically a friend Tech V2 is honestly how I describe it it's at the core primitive is the same you're you're sort of paying for access to the individual um like frch did this through chats uh everything was like

within the same app time. fun is doing this with like a slight twist where you like tokenize your minutes and then you can like the purchaser can redeem these minutes for like a telegram chat a one-on-one call a video call just like a messaging um platform as well so it's broadly the same idea with like a a new iteration on it I think it's cool that we're like iterating on things Mt and I had a good light speed debate on this and it's like this got a lot of heat for just being a frch you know spin-off um but I I think there's like Merit in that in like taking an idea iterating on it forking it and then iterating on it right like we see this in defi ethereum has the most re robust defi ecosystem because of

this um you get these small improvements and then ultimately they tend to work themselves back into the original protocol anyways right like sushi swap did not defeat Unis swap Unis swap lot better over the long term um and so taking that all back to the original question like I think just we're in an era or a meta of financializing these things and I I mean blockchains are inherently Financial they're these asset ledgers that swap assets from person a to person b or or wallet a to wallet B and there's that's what the meta is right now will that be the meta forever it's hard to say um I I get why it's frustrating like I experimented with time. fun personally I was like okay like this isn't for me but um I get it yeah I um I don't know I think the

met the more like medit take is that Twitter has CT has just become a little bit nihilistic lately um and I just think that what I've done and what I would recommend to other people is just to maybe cut down on the time a little bit and just reconnect with whatever that thing was that brought you into crypto where whether you're a gamer or you like medbots or you like fashion I would just encourage people to like a retab back into that and just tone the dial down on the the CT nalism just a little bit because that's 100% true it and I have a theory that it's because everyone is trading meme coins that is like a inherently depressing activity you get this like huge endorphin boost and then you either capitalize on it and sell or you you just retrace everything

and lose money and that's depressing and it's just like this cycle over and over and over again uh it kind of like fits into this like broader view of how Tech is just killing people's attention spans right you just swipe through Tik toks all day long like I don't know that's what it feels like to me and then you just speedran this like whole Cycle's worth of excitement in three months and now everyone's like depressed that is literally what it feels like has happened yeah I that's that's that's all I can really say to that totally I don't I don't actually have too much to add I just think my thought was like this guy probably is down bad on on dgen or on some coin he roundt trip right like I get it at one level it's fine to be critical of these things to some extent because like you

know crypto is so full of grifting that you just have to be careful not to get sucked into the wrong thing um but I also think people are probably too nihilistic to Nat's point where it's like you know if someone is trying in good faith to build uh something over like a three to five year time Horizon like just you know you got to let let that play out and the idea for for social anyway um of having open social graphs where other people can build experiences on top of like a set of data structures um is just cool like regardless of of price like that's the world that you would want to see like if anyone is in crypto um hopefully they'd be more aligned to like that version of an Instagram versus the current version of Instagram um and so it's like yeah

does all this stuff have to be financialized probably not but does all this stuff have to be on chain in one way or the other I think there's at least interesting experiments that are like worth riffing on there that you just have to give a little bit more space for um and yeah the cynics will say what they want to say kind of regardless yeah just stop scrolling and believe in something that's that's the tail just believe in something P's favorite phrase of all time it's real I I love that what do you guys think about like all right so nft were super super hot last cycle they had this like very generic form of this pfp token basically that has uh not fully I I mean I I I don't really love nfts to put my opinion into this matter

but um I'm just curious what you guys think about it like I I know you guys have good views on this and how do you think the nft market shapes up going forward would just say it's like there's a yeah there's there's like the initial Euphoria insane like oh my God these monkey pictures are every where on the internet and across like mainstream culture this is what you become known for um and in some ways it's just a different Ponzi flavor for CT to play right it's it was an unsolved game people would admit these things they would go up people would make money and a lot of folks are left holding the bag um I think you can split you know the evolution of nfts as a category after that run um into sort of this like Gartner hype cycle chart if you guys are

familiar with that where like really over pumps um really Giga dumps and that's where we are sort of like the the oversold area if you will and then the stuff that comes out of that is still cool um and so there's a few different ways you know a few different conversations to have off of this but for me the core thing is just being able to own things natively on the internet seems like a primitive that will matter going forward um nfts are kind of like a facilitator of that whether it's owning art or Collectibles um or having some sort of game economy that you know we'll see if ever if that ever happens from Pico's perspective but um it's really just this thing of like hey this is a new primitive um and in the same way that like icos kind of invented tokens

and they all died and then now we're hoping to come up with a different model where tokens have some value I think nfts are sort of in that lagging version of the same cycle where we're going to start to see some carry value but maybe not as much as like a board eight being 153 eth or whatever it topped out at um so yeah we can talk about speculation we can talk about app design we can talk about collecting there's a lot of things but I'll pass it over to Nat because I think she's got a good framing here yeah I mean it depends it depends how much of a rabbit hole you guys want to go down but I think um I think increasingly there's kind of like two ways to think about the design space of nfts I think one is just like

the metadata which so far has been like the the static pfp things like just linking to a picture of a JPEG you know there's people who have taken that a bit further and they've done you know a dynamic nft or things like this but I think increasingly we're on more interested is in and the actual design of the token program I think that we're not paying enough attention to the fact that you can do a lot in there to actually make the media programmable and to just there's like a whole that's like a whole design Space Rabbit Hole to go down so I'm I'm interested in that side of things increasingly and less so in like just the onchain pointer to a piece of offchain metadata I think that's like the the frame that we've been stuck in for a while but I think there's a lot

more there and I'm hoping to like explore that in the coming months what do you think of before I say this I want to say I'm not bearish onchain gaming because if this like just I need to hedge always I love onchain gaming but just in case I I've gone down that like I'm at the bottom I'll I'll be positive again regarding the pointing to metadata I feel like this was one of the reasons that well it wasn't one of the reasons it blew up because it was speculation but it was used to justify how well Bitcoin inscriptions and ordinals did and this is like I think the puppets guy talks about this a lot and how he wanted

he did not like that a lot of the art on ethereum was just pointing to an ipfs uh versus like Bitcoin is actually in the set and this is not related to the Token programs as much but I kind of want to get this take out as well like I think that's a lot more interesting and if you're in nfds definitely um but I also don't see people caring that much I'm very bearish today for some reason maybe I need more sleep like this is not usually how I am I'm usually very positive very happy I'm always like yeah let's do everything on chain whatever it's probably a good Market signal folks pay attention to that but uh Natalie where do you see some of that Innovation happening uh

like is it chain specific or is it like more come being driven by the app developers that are like here's what we need and like we're just going to pick the place to build it that's the easiest to build yeah this is this is and I my answer to this question I think is going to eliminate why I think a lot of people are so nihilistic because it's not happening in any of those places it's happening in the creative scene it's people making onchain instruments and people creating 3D worlds inside of nfts that are like separate from whatever the metadata actually points to um and so those are like again things that look like toys but if you kind of draw them out 5 10 years you can start to imagine that that goes in quite interesting directions but yeah it's it's interesting and that's where I've been

spending most of my time lately cuz it's actually not in the quote unquote like hackathons and the the the you know the VC places it's it's that's where the artists are and you know and the the creative discords and these sorts of places is where the stuff is actually I think the most like the frontier of it in my opinion totally no I would I would agree with that I think there's actually more experimentation than people might think happening in evm land um not not not to say like there isn't stuff also happening on bitcoin or salana um I just think it's one of these things where the the original take is hey like these nfts are essentially a scam because they're just pointing to another input in a database which is like totally valid critique um but you look at you know art

blocks is all on chain uh terraforms is like a funky example that Nat and I often talk about doing stuff that's not just a 2d thing like there's like a dynamic aspect to this um you know we can go through the list um but I think a lot of it is this question of like what is actually cool that you can do uniquely with a blockchain that is more what I'm interested in than just being like hey here's like a picture of an animal that you know lives in some database it's like you know sure but yeah I think the onchain stuff is much more interesting there are flavors of that though right yeah and to to that point I actually like I know you said that somewhat as a joke but I actually think it's a really important point to make because it kind of points to the

schor the schi morphism of the current nft meta because if you think about that that idea of like pointing to a piece of offchain traditional metadata it's like it's kind of like having a TV and just like putting plays on TV instead of realizing that you can have like nonlinear time and cutting and like you can reimagine the the the kind of like audio visual medium entirely and you can have a TV show and that's like something that's entirely different from a play or just like putting a PDF file on the internet sort of instead of having like an interactive web page and so yeah that's like that's I think that's like how I kind of think about this current meta of nfts where it's like it makes a ton of sense we're like here's things that we already have and own let's

create provenance and markets around them but like you can actually use the blockchain as a medium in and of itself to sort of create new things which I think is the next step if you will yeah I guess it's the same reason people were super excited about frames as well because it completely changed the way you interact with the post themselves um I think the only recur I guess like generative nft that I can think of right now is the GM da one which kind of every time he sent it over it acquired new metadata and like it represented that so if I sent something to Daniel it would be like bukachi sent this to Daniel and then if she sent that to you Ben it would add Dan sentus to Ben I um I'm kind of what are the

leading I guess leading is not the right word but what how can I like do some more reading on this with some more research on this I feel like this something yeah I think I mean happy to like just share some stuff with you guys in the in in the chat but I think terraforms um as like just a project is probably the best thing to explore cuz I would say that's probably like the furthest thing out on the frontier um but also like just the art block stuff as well is also worth diving into um a lot of the just the the more experimental generative art on chain um world so yeah happy to share resources but but the terraform is some great like jumping off point one thing that I had two other people who are very very interested in nft the

one thing we talked about was the same shift away from BFB nfts but apart instead of going into like the generative side we mostly talked about how Zora and drip house basically and like opening up going away from collecting to going away from owning to collecting and I thought that was also quite interesting and looking at some of Zora's numbers it's also like obviously picked up people love the app I I I like Zora on drip house I kind of struggled because a lot of the art was like Alec Monopoly style art which I'm just not interested in but on Zora I actually found a lot of I guess it's it felt more like browsing for images that I want rather than buying um I think the only time I

haven't felt like buying with psbs was like buying maladies and puppets because I wanted to be specifically part of that group I like actually enjoyed it um but yeah how do you you guys think about that like opening up going from owning to collecting instead yeah I think that's absolutely the next step like I'm a Zora power user I meant Everyday um the dopamine hit if you think you get a dopamine hit from like Instagram likes the dopamine hit you get from people collecting your media is like 10x so I recommend people just put stuff out there and I would say to people who come on Zora like do not think that you need to like have some sort of profound essay or visual to drop like write a note in your in your p in your like Notes app and then just mint

it like just don't make it super complicated or highbrow um but yeah I think that's absolutely the future to Zora to me is kind of like onchain Tumblr um which I think is amazing because it's like a scene um what you feel like you go there and you can like it it it has that vibe to it so yeah I'm a fan I'm definitely a fan don't really have anything to add I think it really just comes down to this thing of being able to own stuff online right like you abstract away blockchain you abstract away like the Ponzi nature of speculating on these things and some of it is just like hey that's a behavior that we probably do because we spend so much time on the internet anyway like Mak sense that we should be able to own stuff just different relationship um to

like how content gets made and consumed of all kinds um and I think both drip and Zora have their own kind of Riff on that but yeah definitely a fan as well I was say drips like doing some cool stuff uh like I know they're really putting some effort into expanding the content they offer like they want podast on there they want different types of media they want like more Global media as well like one thing I've like I this is space is fairly new to me and so one thing I've recently picked up on is which intuitively makes sense is based on where you live there is such a different desire for like you obviously there's different cultures and like what appeals to you is so so different especially on like the consumer media and social side um even talking to Kyle Sani from

multicoin he was talking about how like when they like one of the the sectors they're interested in investing in is wallets and like how you get wallets into the hands of people will vary greatly different depending on which like region of the world you're targeting uh or like uh the telegram uh blockchain ton you know they love to like highlight how many monthly active users they have but one of our analysts on our team Ryan Connor is pointing out how like yeah that's great but they're the it's not like a homogeneous group of users they're all like highly uh segmented across different region of the world and thus like you don't just get to tap into all of them simultaneously because they like different things um so I don't I don't know that's something I've been thinking about way more is like the regionality of what people find

interesting yet we have this like inherently Global uh infrastructure with blockchains dear Point Dan I think I per I have a personal thesis which is like sort of cut a little bit of Half Baked about curation having to become more sort of like a local and decentralized again partially just because of the sheer volume of content that we see on the intern and the fact that AI is probably going to crank that up by at least an order of magnitude and I think that most web 2 companies today their business models and their actual platform infrastructure is built for a certain amount of volume from a Content moderation perspective from a curation perspective and like I just don't know how that goes and so I think to the regional perspective I do think it's

something crypto could be useful for is helping to facilitate more local and decentralized curation because I think that that's probably going to be more needed as time goes on Daniel it was kind of crazy that you managed to both defend Solana and complain about user counts in the same sense I was hly shocked at how well you pull it off um that's what they call me the Sultan of salana these days yeah it's you and bit Bo what I was going to say is that this is not related to crypto anymore but I want to ask about it pumping out generative content my biggest fear for crypto is and this is always been my biggest fear for crypto because I always before I joined crypto

I was a no social media I only had like a brick phone um I wasn't on the internet at all so I'm like constantly kind of yearning for the past where I don't use the internet at all and one of my worries is that when this isn't related to like I guess it is if you're pumping out generative content and Ai and like you said Facebook Instagram they they don't have any reason to not I guess um so this out My worry is that people are just going to be like I'm done and I feel like I'm seeing this a little bit on at least my like surroundings people are like I'm done like I'm genuine like okay a lot of people quit Instagram but even at a higher level they're like I'm just not going to go on my phone today just going

to like leave the internet for a little bit I think that's my biggest bease for crypto that people just get sick and tired of the internet we go back to the old days no phone just taking walks talking to people good luck think the other side really this is team team Europe versus Team North America on on that take I think I honestly I wish that would happen but I don't think it will that' be that I'm like that too yeah really wow this is a horrible take by me I'm not going to let this there's I think there's you're not alone there's that there is a community of people but I think the larg community of people is is probably in a different

place fully addicted swiping swiping swiping interesting a lot of my friends are just not online anymore maybe I'm you're living a no you're you're you're you're crushing it like it dud do you if you can that's awesome no like just logging off CT even like you mentioned it's it's hard for me but I see people who just don't even check their phones sometimes they like how do you guys do this like must be nice uh B and Natalie you guys both spend a lot of time with Founders so I'm ious like what what um what like key mistakes have you seen people make uh that is like a a something you'd love to see Founders stop making I'll like I guess I'll I'll slightly rephrase it to

say like what's the thing I see most people missing or not thinking enough about I think the number one thing that I feel is missing um when I speak to the average crypto founder is just a conviction and a vision I feel like a lot of people can tell you what they think might happen in the next six months or the next 12 months but there's not a lot of people who are are able to see around the corner and like also convince you of it and then also like actually believe that it's going to happen enough to where they're like they're like their the full force of their energy is behind it like you feel it when you interact with them I think there's a lot I don't think we have a talent shortage in crypto but I think we do have like a vision belief

inspiration shortage so yeah I would just encourage people to just tap into whatever inspiration sources they have because I think we're that's gen generally what I see lacking the most in my conversations conviction and communication love that Ben what about you yeah one sort of Riff on the conviction thing is I think a lot of there's a lot of talent like Nat has said there's a lot of people who want to build cool stuff um but there's just a like crazy scattering of attention um like you go you have like a hundred darts versus one spear being the analogy like it's super rare to have one person build one thing um for like a long time period um versus like hey I kind of have this side hustle and then I also was like involved in this other thing and

I'm advising these five things like you don't have the Steve Jobs is overused as an example um but if you look at even Zuck like some of these bigger Founders where you're like yo I did one thing for 20 years and absolutely kicked ass at it crypto doesn't really have people like that or they are very few right um you know you think about Raj and toally as good examples of like yeah we want to make this our our life's work that's kind of the model right where you want to see more of that and I think a lot of Founders are uh non-committal so it is really that conviction Point um I also think if I had to add something completely different um just like being able to find good people to counterweight your weaknesses um is important sounds obvious but I feel like

there's a lot of people in crypto who are like you know you would do really well if you had a COO you would do really well if you had like some other person to just like help you with this Vision so even if you get to conviction uh being able to build out people around you uh is key for some people that might be a comm's person but no that's another great Point as well one uh one I'm curious what you guys think about this this idea is one thing I feel like I've seen in crypto is people get like enamored by the tech I think all of us probably included and you're like holy like this is awesome like I just want to build something here they like all right like I'm I want to build something on a blockchain like let me back into the product idea which

probably isn't the best way to figure out what people want versus going the other way we like hey like here's a product idea I'm fired up to build I'm going to go build it and then I'm like hey like all right let me plug this thing into crypto rails and I get benefits X Y and Z so there's like the path dependency of how you create this idea to bring it to to reality is what seems to matter here I'm curious if you guys see any of that of like Founders that are obsessed with crypto and kind of back into the product to build to be able to say like you're building something in crypto uh if you see more of that or the other way around where it's just like product people who are excited to build something awesome and figure out that hey using crypto makes

makes my products better I am actually almost exclusively only interested in the second category from an investor perspective um cuz those actually because of the way you approach it end up being the things that are more interesting and useful because it's like I'm only coming to crypto cuz I I I had to and I just happen to maybe understand that I'm a tech person so I've been around the space but like that and you're honestly only really starting to see those Founders come in more recently I feel like but yes number two is like what number two it's kind of like this this conversation of founder market fit uh to throw out a buzzword of like you know you talk to people and you're like wow you really built to build that business right you know I'm thinking of

uh like a friend of mine that's a good example is Adam from tala which is this like defi Hub on optos super random example but he has been obsessed with financial software since he was like 14 years old trying to do all of these different things whether it's like you know using Bitcoin to get around csgo market like skin markets things like this and so the convergence for him is like yo I just want to build Good Financial software that's not me I don't really care about that but that's him and that's like why you know some Venture people would get to wanting to support someone like that um but I think to your kind of original question there's definitely a barbell of people that fit on the the kind of the other side of the equation which is like yo I'm I'm an entrepreneur I want to make

some money like I feel like I fit in this category what exists out there that I can build and there's nothing necessarily wrong with that it's more just like it's less of a venture conversation and more of like how do you get to making money pretty quickly like is there a way to drop a token and fair launch something like are you you know able to take a different route to find success um yeah so there there're sort of two buckets but the Venture side really is only focused at least in in my experience as well with those people with the vision since we're talking Venture what are you guys seeing these days that you are happy that you're finally seeing that you used to not see I guess like what is there more out of that like people are

building I'll be honest I'm not really watching the market super closely these days like even even the Venture Market it's much um it's a little bit of like a a kind of stepback in reevaluate mode for me these days um but it but it has been nice just to see the more more people being serious building consumer stuff I think I just want to let that play out for a little bit longer um that is a trend as great but I'm not super like you know in the moment yeah I don't have too much to add I think um you guys did a great episode with Jeff from hyper liquid and it's a good kind of example of I think people looking at uh a few areas in crypto that

have some product Market fit and thinking like okay from first principles how would we make this like even better so you're seeing some Founders take runs at at those sorts of things um and then it is more along the kind of experimental lines right like there's there's some consumer stuff I do actually think there's pretty consistent gaming ideas I don't know how much of that is getting funded um but there's a lot of people still kind of riffing on like how could we actually do this on on the blockchain gaming side of things um but yeah it's it's a little bit of a a lull after like a really intense six to n month um kind of runup if that makes sense that's and I don't know how to ask this because I always failed to ask about I'm going try what do you think of

I guess valuations at this point for like in general because VC is you it's so hard to get an insight into how you guys do stuff so I want to get to that um I think valuation I'll I'll I think the the the what I've seen is that there's a little bit of like a weird thing where there's a couple companies in crypto that will get some traction and like you guys you guys saw the forecast around like that's public information out and and those companies will get these massive massive valuations and then it's like prior to that you know stuff is really I can be at a really reasonable you know seed maybe even cheap valuation but there's like not a ton of in between it's like it's either like too early or you have like a tiny bit of traction and then

it's just like a trillion dollars so yeah it's a it's a little bit of uh not a ton of M middle ground it seems like at the moment yeah I feel like on that like higher valuation side of the the conversation it's it's basically this problem if there aren't that many good products prods are good Founders to fund in the first place and there's just there's more money sloshing around the ecosystem than there are good Founders and so that's why you just you get these pretty what you know what could see seem inflated uh valuations on these things uh just because you know there's a lot of money chasing not that many um investment opportunities and then like not said on on kind of the preed seed stage stuff um on the one hand it can

seem cheap in relative terms whether people are raising at like 10 mil or 20 mil or five or something um and a lot of that funded but if you ever go and talk to people outside of crypto they're like what about that is worth $10 million like what like that even the low end is kind of whacked um so yeah it's a big it depends I um I noticed that recently my girlfriend's in VC and like they fund actual not actual but like real invest in a real company they're real VCS yeah no and I was like and some like just telling her about she's probably like insane yeah it's crazy dadel do you have anything to add are we no I know this

has been a pleasure Ben and Natalie I appreciate you both coming on yeah thank you guys for for having us I feel like I'm famous now I've been on zero X research oh man hey if any other listeners out there if you love coming on if you love listening to the show we're always uh loving to have our power listeners on so hit up Bako on the DMS yep just send me Twitter DMS that that'll work work out but um guys also make sure to check make sure to check out liquid culture um Natalie and Ben's podcast as well as I guess Bane capital and Seed club rachio with the shill to finish yeah I love it we'll put the links in the show notes as well to all those

things of course awesome guys thank you cheers have a good one y'all [Music]