From: thepipeline_xyz
The conversation delves into the evolving landscape of the NFT market, exploring its cultural significance, community dynamics, and future trajectory, particularly in relation to gaming and broader crypto adoption.
The Current State of the NFT Market
There is a perception that NFTs are “dead” among some circles, ironically often by those who use NFT profile pictures themselves [00:34:46]. This sentiment reflects a shift from the initial excitement around NFT art and collectibles like Top Shot moments [00:35:35]. The market then gravitated towards seeing NFTs as financial primitives and investment vehicles for passive income, which often did not materialize as expected [00:35:44].
Despite this, there was a resurgence in the current cycle, with some NFT collections breaking their all-time highs, indicating continued interest and trading activity [00:36:02].
Two Camps of NFT Engagement
Currently, two main camps exist regarding NFTs:
- Investment Vehicle: Some view NFTs primarily as a means to acquire tokens or as a vehicle for token vesting [00:36:36].
- Cultural Statement: Others, particularly the “Crypto Twitter” (CT) native crowd, prioritize the cultural impact, aesthetics, and the sense of belonging within a community [00:36:59]. This group is interested in what NFTs contribute to the world, including performance art and expressing cultural values like anarchism and libertarianism, which are roots of crypto [00:37:21].
Art is not the primary factor for many; rather, it is the network and collective of people actively engaging and outputting something they believe in [00:37:50].
Cultural Impact and Community Loyalty
The “culture is sacred” philosophy is crucial to the success and longevity of NFT projects [00:25:09]. In crypto, where traditional fundamentals may not always apply, the cultural piece acts as the “main glue” holding things together [00:26:47]. It answers why people should care and spend time getting behind a project [00:26:57].
NFTs serve as an identity and a “passport” in the metaverse, where online presence often constitutes a significant part of one’s lifestyle [00:28:14]. Unlike meme coins that tend to die off when interest wanes, NFT communities often exhibit a strange human psychology of attachment, even with “zombie community members” who deeply care about their assets [00:32:56]. This emotional feeling, though unquantifiable, is a significant psychological element [00:33:17].
Organizations like Sappy Seals focus on attracting “value-add” individuals who can produce things the founders cannot, fostering a collective of people united by a shared interest [00:27:07]. This collective, or “network,” assigns value to the NFT or token, differing from traditional business valuations based on revenue [00:28:47]. The goal is to increase this “network value” by creating interesting things that bring more people into the fold [00:29:23].
Gaming as a Key Use Case for NFTs
Gaming is considered a natural and logical use case for blockchain and NFTs because it involves digital economies and the exchange of tokenized assets [00:04:51]. It offers a “product-market fit” by allowing people to exchange digital assets within actively played experiences [00:05:07].
Wob, founder of Sappy Seals, and John Hook, co-founder of Play Ember, initiated a collaboration that will bring Sappy Seals and Play Ember to the Monad testnet [00:02:06]. Their partnership began at a gaming NFT meetup, recognizing their complementary strengths: Play Ember’s experience in building and scaling games with millions of users, and Sappy Seals’ “rabid community” [00:02:11]. Their new game concept is code-named “Sappy Quest,” an RPG Dungeon Crawler [00:03:36].
Gaming is seen as one of the “end games” for crypto in terms of onboarding actual users, as proven by past examples like Axie Infinity and projects like Prime and Parallel [00:06:00]. It provides interesting on-chain activities that can lead to broader engagement with crypto [00:11:00].
Challenges in Web3 Gaming
One of the biggest challenges in web3 gaming is the overcomplication of experiences, especially for casual audiences [00:08:01]. To attract “normies” (non-crypto natives), games need to be light-touch and provide the same level of entertainment as Web2 games, without significant technical friction [00:08:27].
There’s a perception that crypto games “suck” because talented game developers are disincentivized by the perceived risk of building in crypto [00:12:38]. This leads to less experienced developers entering the space, resulting in lower-quality games. However, this is seen as “growing pains” of a young industry [00:12:56]. As the industry matures and becomes less risky (e.g., with ETFs and stablecoin adoption), more talent is expected to enter [00:13:00].
The goal is to create products that scale and onboard people, reaching beyond the “inner cult community that crypto has” [00:07:02]. Casual games might not convert someone into a “crypto Maxi,” but they can effectively involve people if done correctly [00:12:26].
The Future of NFTs and Community
The future of NFTs and crypto adoption hinges on building engaging experiences that appeal to broader audiences [00:41:49].
“We’re literally scratching the surface of people that have been exposed to these new brands… the stuff that like web is a genius at… web 2 are going to like that they love communities they love all this stuff we’re talking about bar maybe some of the nuances of crypto but they like memes they like culture they like Brands they like entertainment they like feeling a part of something all the will resonate with them right it’s not like oh web 2 won’t get this.” [00:41:31]
The industry needs to continue pushing out new ideas and doing interesting things that matter to the world beyond just crypto, which will naturally attract more attention and engagement [00:38:09].
There is a need for more innovation in NFTs, not in terms of passive income models, but by offering something truly unique to the world [00:54:50].
“When you actually see something that’s innovative in crypto that’s actually going to be the next thing it will be impossible to understand because it won’t look like the thing that came before. It’s like when we see the game that’s actually going to be the mainstream game it’s not going to look like Call of Duty with coins, it’s going to be this completely different thing that no one’s ever seen before and will be just like super confusing at first.” [00:46:13]
This necessitates a shift from retrofitting crypto to traditional company models towards embracing new, often “cultish” and inner-circle driven growth methods [00:45:37]. Authentic, grassroots initiatives, rather than those solely fueled by large capital, are essential for success and longevity in the crypto space [00:50:37]. Authenticity is described as the most valuable currency in an attention-saturated world [00:51:37].