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NFTs and a Thousand True Fans
Day 3: 30 Days of Crypto-modeling
Buy muh art plz!
As part of researching these posts, I made a bit of AI-augmented art and turned it into an NFT!
I’m a little bit excited about the creative opportunities that could arise from combining AI and data science with a programmable collectible. Hopefully, Ill have more on that soon.
Collecting is a fundamental economic activity.
The purported use case of nonfungible tokens NFT’s is digital collectibles.
Art, comic books, pogs, Pokemon cards, stamps, sports cards, designer handbags, troll dolls, sneakers…
Tabletop games with collectible items retain a significant following. Dungeons and Dragons is still popular, and games such as Warhammer have become popular in recent years.
Entire companies such as Funko exist to sell collectibles like these figurines.
Okay. There is obvious hype and speculation in the NFT. Case in point, this guy sold his fart.
But collection is undeniably a fundamental economic activity and thus a possible tether for NFT values after that bubble bursts.
So the question to ask is, "Why is simply having a third party provide this solution a bad idea?"
Eliminating Social Media Middlemen
There could be good deal of value created by displacing Instagram, Facebook, and other social media platforms as the broker between artists and fans.
In his 2008 essay “1000 True Fans,” Kevin Kelly predicted that the Internet would transform the economics of creative activities:
To be a successful creator you don’t need millions. You don’t need millions of dollars or millions of customers, millions of clients or millions of fans. To make a living as a craftsperson, photographer, musician, designer, author, animator, app maker, entrepreneur, or inventor you need only thousands of true fans. A true fan is defined as a fan that will buy anything you produce. These diehard fans will drive 200 miles to see you sing; they will buy the hardback and paperback and audible versions of your book; they will purchase your next figurine sight unseen; they will pay for the “best-of” DVD version of your free YouTube channel; they will come to your chef’s table once a month.
Kelly’s idealistic vision was that success for creators would not on receiving the blessing of major publishers book deal, a major record label's record deal, casting by a major film company, or some other audience gatekeeper. Instead, the Internet would enable the artist to reach fans directly and get compensated directly by those fans in amounts sufficient to devote themselves fully to their craft. Further, this would lead to an explosion of creative diversity as it became unnecessary to have the mainstream appeal required by the gatekeepers.
Then social media ate the Internet, and their walled gardens made them the new gatekeepers, displacing the record labels and film companies. Further, the amount of value of the transactions between creatives and fans captured by the platform gatekeepers put the traditional gatekeepers to shame, leaving only a pittance for the creatives.
And creatives still couldn’t focus on their niche. They still need to have mainstream appeal to make a living, except that in a recommendation-algorithm-fueled attention economy, this meant creating content that gets a large number of likes and shares and hopefully goals viral.
NFTs could help eliminate social media platforms as the brokers of culture and shift things back in the direction of Kelly's vision of creators monetizing directly with their fans.
But there are still alternatives to the NFT…
But there are signs we are already moving away from social media’s stranglehold on culture. What of the rise of creative subscription services like Patreon, Substack, and Onlyfans?
And why do we need decentralization to enforce scarcity?
Why can’t Funko create its own centralized ledger to track ownership of digital collectible toys and figurines that it creates? If Funko doesn’t want do this, why not partner a company like Docusign where cryptographically protected verification is a core competancy?
Speaking of supporting creatives…