(Alternately titled – ️🗝️NFTs and the keys to a universe🌌)
This is another somewhat stream of consciousness post. I think I may make these more of the norm to encourage myself to be more prolific. Less editing, more writing, for now. And a disclaimer - when it comes to Web3, NFTs and crypto investing I really don't know what I'm doing so please treat this as such.
So NFTs. Non-fungible tokens. I've written about them here earlier this year when I bought my first one. I ended that post on this note –
I bought this trippy blockchain themed NFT created by Tim West because I loved it as a piece of art. It reminded me of the first simple animation I created when I was a computer science major — a 90s Windows screensaver like scene with a ball bouncing off different corners of the screen.
The elements of the beginning of a discovery, nostalgia, and aesthetic attractiveness were large factors in me wanting to own this. But I also bought it because I feel that while it's still early the mechanism of the NFT certainly has a lot of promise.
Since then I've spent a lot more time exploring the space. Spending time lurking in Discord servers and some money on jpeg (NFT) files.
I talked about the concept of provenance and the potential for automated, equitable distribution of profits that NFTs facilitate in a permission-less manner in my last piece.
So on this fine weekend afternoon in Detroit, I'd like to talk about keys to a universe and what I'm calling for now the Blitmap template.
P.S. If you've heard me share this story or are already familiar with the Blitmap project you may want to skip ahead to the Blitmap template portion of this post.
Oh, you may be wondering...what the f$*& is Blitmap? Blitmap is a crypto native community-crafted sci-fi fantasy universe that was started by Dom Hofmann, best known as the creator of the virally popular but now sunset video-sharing site Vine. Ok, but what does that mean, Rahul?
Blitmap was started by Dom Hofmann with 16 other artists who created 100 "blitmaps", which are just fun pixel art, reminiscent of the kind of stuff you played around with during the 90s and early 2ks. They made 100 original pixel art images and then invited the internet community to make 1600 siblings. Each of the 1600 is unique and combines the composition of one piece with the palette of the other...like this.
What was also unique about this project was that all the images themselves and the logic used to create them are also stored on the Ethereum blockchain instead of pointing to another (Web 2) website (i.e., it was "on-chain").
I was one such member of the community. I had been following Dom and a couple of the artists from this project on Twitter for a bit. The process of making your sibling was playful and fun and I did that on a Saturday afternoon in early June that felt a lot like today. The cost to mint of these siblings was 0.1 ETH which I think at the time was somewhere in the vicinity of $300.
I'm not going to lie. It felt a little weird to be spending something like $300 to get the image below. But I was curious and this felt like a fun, playful, on-chain experiment. I picked two original blitmaps - Hillside and Wave - largely because they are both things that deeply resonate with me. I was born in a hillside town in India called Ooty and have grown up to love the water and the waves. That was really the extent of my thought process. I was vibing with the Blitmap experience. Hillside Wave was born.
I thought about minting a few more for fun but I really had no idea what I was doing so the thought of spending another $600-$1000 on fun jpegs felt a little frivolous and I decided against it and went about the rest of my Saturday. (That would turn out to be a mistake.)
Shortly after the collection of all 1600 siblings were created they announced Blitnauts, an expansion pack to this sci-fi universe, heroes of the Blitmap universe. I loved the playful artwork and how the Blitmaps were going to be included in the future expansion. You had to own a Blitmap to participate so I also felt like a member of a fun clique.
For the next few months, I followed the project, and some of the artists along on Twitter saw examples of what other people's Blitmaps looked like, and continued just vibing with the project. This wasn't an investment. It was just a fun, on-chain project, which seemed to be supported by a good, small community.
Then sometime in August, I started getting bids on Hillside Wave. It started at about 1 ETH which was 10x what I minted this for. This surprised and intrigued me but I mostly ignored it. The bids didn't stop. They kept climbing gradually by a few thousand dollars a day. Suddenly this playful experiment had transitioned to a potential investment.
To cut to the chase I ended up selling Hillside Wave for an amount that was in the vicinity of what I made in a year of consulting when I first started working. Suffice to say this was not insignificant.
I share this not to gloat or introduce FOMO but to be transparent. The Web3 / crypto space is strange and somewhat illegible to most observers including me. Part of my reason to play in this space is so that I can share transparently. Anyone listening can then choose to either participate or stay away. Financial gains and losses are part of that. Also, it's clear that while a lot of people don't take NFTs seriously and trivialize it with comments like "but I can copy and paste this" or "this is clearly money laundering"*, introducing transparent personal stories that have a monetary component are a way to get people to take the space a little more seriously, for good or for bad.
While this decision to sell may feel like a no-brainer, it was and continues to be very bittersweet to me. I had given up my keys to the Blitmap universe, at least for a while. I did decide after another week or two to buy into it by buying a Blitnaut. I bought this for a much lower amount than I sold the Blitmap for but an amount that was also not trivial and that early-June-Blitmap-minting-Rahul would have considered crazily irresponsible. To be honest, I'm still not sure if it was a responsible decision, the financial value may depreciate slowly or very quickly, but I am back in the Blitmap universe.
*I'm sure there is some degree of money laundering happening in the crypto space. However, with the degree of attention NFTs are getting in the media and the nature of how things are irreversibly recorded on the blockchain I suspect more conventional methods of money laundering like real estate purchases or dry cleaning operations may be preferable for people trying to stay under the radar.
Now on to the Blitmap template.
NFTs have been reduced in popular vernacular to be analogous to digital art and this isn't entirely wrong given current use cases. But you do need to periodically say the words out loud to avoid seeing them as only digital art or jpeg files.
The word token specifically is the part I want to highlight for a second here. Balaji Srinivasan wrote a great introductory piece on tokens back in 2017 that included this excerpt –
The best existing analogy for tokens may be the concept of a paid API key. For example, when you buy an API key from Amazon Web Services for dollars, you can redeem that API key for time on Amazon’s cloud. The purchase of a token like ether is similar, in that you can redeem ETH for compute time on the decentralized Ethereum compute network. This redemption value gives tokens inherent utility.
What I want to focus on now is utility. We can debate the specifics of what utility means and the degree of utility. But the reason the decision to sell Hillside Wave felt bittersweet to me was that I was losing access. Access to this emerging sci-fi universe had utility to me even if that just meant future participation in a universe something that doesn't quite even exist today in its full form.
Hillside Wave was more than a strange pixelated jpeg file on the Ethereum blockchain. It was a token that allowed me access. It was a key to an emerging universe.
I believe using this frame to understand and engage with NFTs as keys to a universe can lead to a lot of very interesting possibilities beyond just crypto art and gaming.
A brief digression to compare two emerging templates to create NFT based projects, both in very open, collaborative ways.
Blitmap vs. LOOT.
I would be remiss not to briefly explore a project that has captured the collective Web3 consciousness, vastly more than Blitmap. That project is called Loot. This was also created by Dom Hoffman, creator of Blitmap, and announced with the tweet below on a Friday afternoon in August.
All the Loot project started off as was a series of 8000 randomized NFTs with a series of phrases on them. "adventurer gear". Gear for possible players of a game. The key twist here was that there was (and is) no game. No definitions, no constraints, no copyrights. Just 8000 bags of gear in text-heavy images that you could mint for free on the Ethereum blockchain (you did need to pay network gas fees). The rest was up to the collective imagination of the community.
What happened next was quite astounding to witness even for practitioners in the space (i.e., not me). All 8000 bags were minted in a matter of hours, unlike Blitmap which took weeks I suspect.
Then in a matter of days people started and are continuing to build things around Loot. Generative artwork to imagine what this gear looked like. Spreadsheets identifying the rarity of different gear (e.g., Divine Robes are quite desirable). A token called ALGD was created around Loot and liquidity was generated by the community for this token. It would be a little too much for me to get into the mechanics of this here, partly because I'm still learning this myself, but I'll just say that Loot bag holders suddenly found that their NFTs were valued in the thousands of dollars AND the ALGD tokens they were airdropped were worth thousands of dollars. There continues to be a buzz of activity and discussion around Loot and the idea of NFT projects being introduced in a manner that encourages truly decentralized building and development around it.
People have even described Loot as a social network and as a pivotal moment in the Web 3 space.
While I have been fascinated with the Loot project (procured some mLoot and am on the Discord) and the emerging decentralized social and creative dynamics I'm more excited about Blitmap as an accessible template.
Hopefully, the differences in approach here are clear. Blitmap is more controlled world-building with a roadmap, a core set of creators with a vision, and a somewhat small but expanding, engaged community.
Loot is the start of an idea. A spark that was thrown out into the universe for anyone to take and run with, perhaps in many different directions. Perhaps 100 strange interesting things will emerge. Perhaps just a couple. It's unlikely to be none. Loot is fascinating but chaotic. A lot of interesting things may emerge from this but I don't see it as a pattern for sustainable world-building.
Ok so here is why I find Blitmap such an interesting experiment and possible template.
I think we can and should think of any project – business, book, art portfolio and so on – as a form of universe (or world) building.
The size of the universe is irrelevant to start. It can be a rhyme you make up for your kid or a professional video game or a small business where you sell excellent pickled radishes or a neighborhood cocktail bar you build with a few determined friends.
Each of these is a universe. For the universe to make sense to you and to the people you want in it, the universe needs lore. Perhaps an origin story to start and then lore that emerges from this. You can be deliberate about this or neglect this entirely. If you're not deliberate about it someone else will make up the lore for you. Even if it's a rhyme you make up to sing to your kid. You know that if your kid enjoys it or grasps on to it even slightly there will be lore built around this. A quick rhyme can take on a life of its own. It could be a small universe with just the two of you residing in it for the time being.
But because we don't always view endeavors as universe-building we don't take into account a few things - the lore, access to and ownership of this universe.
Here come the keys. NFTs are the keys. By deliberately thinking about and creating keys you can address the lore, access and ownership.
Blitmaps were the key to the Blitmap universe. Perhaps Blitnauts might be as well, that portion of the lore is still deliberately cloudy, possibly because the creators are still thinking and writing. Perhaps they are keys that unlock doors to different things in the universe?
Keys are the unlock for the lore + access + ownership
And what Blitmap did so interestingly (and what I believe can be a template to many) was allowing members of the community like me to be part of the process of creating their own keys. The keys weren't just handed to me. I was given some constraints and then the ability to craft my own keys. The nature of the keys and what they signify imply a degree of scarcity but also not a zero sum game.
Now let's take these three things and see how they can have very interesting impacts in the world outside of jpegs.
Oh jeez this stream of consciousness is now at almost 2500 words so let me try and wrap this up in a few hundred words more...no promises. Lets play out the template with a make believe IRL (in real life) example so that I lightly steelman my own thinking.
Lets pretend a group of founders are opening up a neighborhood bar in West Village, Detroit.
It's called Ultrasound Crafts (and here in emoji form 🦇🔊🥃).
Building a neighborhood cocktail bar is a non trivial investment so they seek some degree of conventional funding to get started. But our founders have universe building in mind and want to create something that allows the community to be a part of the lore, to have access and a degree of ownership.
The decide to experiment with a tokenized approach using NFTs.
The founding team decides to create a series of NFTs, one thousand three hundred and thirteen (1,313) in total to start. Each NFT is accompanied by a piece of Detroit themed cocktail art. Each supporter can mint up to 10. Don't get greedy, y'all.
Supporters get to create their keys (NFTs) by mixing and matching a few different attributes to create this piece of art (attributes could be a type of cocktail or type of liquor perhaps combined with a neighborhood in Detroit, a color palette, etc etc, you get it). Art is cool but we are need utility. These NFTs are going to be keys to the universe that is presently Ultrasound Crafts (but could expand beyond this).
Utility in this case could be in the form of IRL benefits. As an example holders of NFTs in which bourbon is an attribute will have discounted access to pours of special barrel aged picks that are brought in every quarter. You don't get discounted access if bourbon isn't an attribute to your NFTs. But hey if you NFT featured a pineapple guess who's getting discounted access to drinks on tiki night?
Oh and all you beautiful NFT owners will have lifetime access to an annual holders only cocktail extravaganza. Are we having fun yet?
I got distracted by this question for a bit - how is a token might different from equity in a company. Another excerpt from Balaji Srinivasan's piece on tokens is relevant here –
Tokens aren’t equity, because they have intrinsic use and because they are non-dilutive to the company’s capitalization table.
But Rahul, how is this NFT based tokenized approach different from just doing a crowdfund on a platform like Kickstarter? Also, how is different from just another rewards program or mug club that my local brewery has? Fair. But I think an interesting aspect to NFTs on a blockchain is that they are tradeable by design and can also be composable to lead to new and interesting possibilities.
Lets say Ultrasound Crafts 🦇🔊🥃 becomes widely popular. OG NFT owners paid 0.5 ETH at the time of mint. But now as demand for the tastemakers at Ultrasound increases the value of these NFTs increase. Others who see value in being part of this emerging universe can make offers to existing owners. By creating NFTs on a blockchain like Ethereum the founders of Ultrasound Crafts can allow users to make these trades independently.
Or say you are a holder of 10 NFTs. You can gift this access to a few friends by just sending it to their Ethereum wallet. Or perhaps you are sadly leaving Detroit. You can decide to keep all but one NFT and see if you can put the others up for sale or send them to your friends.
NFTs holders could have a degree of ownership, perhaps on the future roadmap for the bar, or just by being able to vote on things like design choices or new additions to the already stellar menu.
Oh yeah I also mentioned composable. Say Ultrasound Crafts wanted to partner up with the favorite local restaurant and butcher shop Marrow Detroit who perhaps just ventured into the smart contract world also. There could be ways by which NFT holders are airdropped an one time use NFT from Marrow for a special fall event. Somewhat unrelated blocks that could build on each other to create utility for holder.
Ok one last thought. Say the founders of Ultrasound Crafts decide a year later that the time has come to expand the universe and embark on a new project called WAGMI Tacos (🏆🌞🌮). They could reward existing Ultrasound Craft NFT holders with a WAGMI Tacos NFT. (WAGMI = we're all gonna make it)
The universe is expanding and OG supporters who still have keys can continue to have a degree of access, ownership, and be part of the expanding lore.
Something like this has already happened to me by virtue of being part of the Blitmap universe. I was airdropped this NFT called Song of Fire which is something that will some utility in a planned game called Sugar. I have no idea what this is but it's cool that my keys allow me a degree of access to something seemingly unrelated. It's also presently valued at more than what I minted Hillside Wave for.
I hope you can tell that I'm just riffing with myself and making this up the world of NFTs broadly and the Blitmap template that I've had the pleasure to witness has me even more interested than I was a few months ago. Like I ended my last piece on NFTs...
...I feel that while it's still early the mechanism of the NFT certainly has a lot of promise.