Paper 29: Why I Sold My Moonbird
How I have become fatigued by NFT projects
Contents
Why I Sold My Moonbird
This Week in NFT World
New Interviews
Thought of the Week
Meme of the Week
Before I start this week, a free offer as part of my update on Airdrop Szn 1 which I launched via 32 Dreams.
If you’d like to get onboard either Arbitrum, zkSync, or Starknet, reply to this email or message me with which one you want and I’ll send over a free “taster” tutorial.
We launched Airdrop Szn 1 to save people time looking for interesting protocols and airdrop opportunities on Layer 2s. Our cohort is up to almost 80 NFT holders who get access to our discord where we provide weekly tutorials, strategy breakdowns, and more.
Example strategy breakdown
We appreciate it is difficult to keep track of everything going on in this space, so we try to present information in a way that helps you.
(DRAFT) Tokenless bridges: it’s a pain to know which bridges are tokenless and which chains they support, so we present some clearly like this
We’ve seen an uptick in interest recently (we’ve done another ETH in volume the last couple of weeks), I think because people are waking up to the narrative/importance of Layer 2s.
$OP and Optimism are on the rise
Arbitrum Odyssey Campaign should be back soon as Nitro will be ready on August 31
zkSync is going live in less than 100 days
Starknet announced their token
You can find out more info and mint Airdrop Szn 1 NFT here, and feel free to message me if you have any questions.
1. Why I Sold My Moonbird
This week I sold my Moonbird, which was my most significant investment in the space for a while.
Here I lay out some of my reasons because I think some of them are actually relevant to a lot of projects at the moment.
It is obviously not financial advice. There are many reasons to believe PROOF will continue to do very well.
a) Taking away what has already been given
Moonbirds were sold to customers with the IP rights included; Kevin, Justin, and Josh decided a few months later to “set Moonbirds and Oddities free” and remove holder’s exclusive IP rights.
For the people who do care about IP rights, that is a big deal.
Lakoz lost a six-figure deal as a consequence of the decision.
And some people like j1mmy consider that value directly accrues from the exclusive IP rights.
I’ve read lots of people say: “many of you were not going to do anything with the IP rights anyway.” This is a childish response imo.
It doesn’t really matter what the rights are, the point is they were on the table at the point of sale. (I am well aware that it is within the law for the rights to be changed later.) In this way you have been sold one thing, whose nature has changed a couple of months later - and that sucks. (This was not lost on Josh below.)
b) Happy for change - if worth it
I am not in the camp that suggests that leadership should never make these types of huge decisions, nor that leadership need to constantly ask for the community’s permission or approval.
I think leadership should take the decisions which they think best based on good evidence and reason.
I’m simply not convinced by these reasons. I might be wrong on all of these, but I do NOT think:
People who do not own Moonbirds will start to remix Moonbirds for commercial purposes
It is a big deal for a huge company to enforce some IP/trademark issues
Value will accrue to tokenholders as a consequence of Moonbirds becoming CC0
Moonbirds became a top-tier NFT project without being CC0. So what is the marginal benefit of this decision? And to whom does that benefit accrue?
c) Mismatch in incentives between company and tokenholders
To whom does the value accrue?
This is the biggest question that all top “NFT community” projects face. And many are “failing” right now because they can’t convince NFT holders that value will accrue to them.
This is what @bitfloorsghost brought up rightly in their latest newsletter.
Are they building out the PROOF brand with the hopes that the NFTs gain value by association, or are they intentionally designing products specifically for our community, that other people outside the community get to use (as a secondary benefit).
@bitfloorsghost, Constructive Criticism
Was this CC0 decision one that benefits PROOF or the tokenholders more?
I think it helps PROOF more than it does tokenholders. But thinking beyond this - what are they actually building and how will it benefit holders?
It may be the most brilliant, revolutionary thing (and I hope it is for holders) but I’m fatigued by the language of promised futures and have no more appetite for this sort of risk when communication is lacking in other regards.
d) Communication - at best incompetent, at worst dishonest
Communication sucks in this space.
To PROOF’s credit, they do it regular and often, which is more than others - but that doesn’t mean the right messages are being communicated.
One particular moment stuck in my mind.
Regarding the Oddities reveal, the team explained that they should have provided more information on the reveal so that there wasn’t so much speculation on those NFTs.
When I heard this I was very close to selling to be honest. In my mind two things could be true:
they did not know there would be speculation on an asset which they hadn’t explained properly = incompetent (how could you be a part of this space over the last 18 months and think speculation would not take place?); OR
they did know there would be speculation and wanted there to be speculation so they could gain more secondary fees (14.4K E secondary volume to date)
One of these conclusions is true, and I am not comfortable with either.
e) Buckle up - wait, what? No thanks
I do understand this space is like being on a rollercoaster - I often enjoy that aspect.
But in light of these uncertainties on the future, and the other points I have raised, I have opted out of “buckling up”.
f) Closing thoughts
Apart from the the CC0 decision, many of these issues are not exclusive to PROOF. There are problems at the core of the NFT value proposition for certain types of projects:
It is not clear to me how highly valued community based / PFP collection NFTs continue to accrue value to holders over time, unless they are established as a veblen good OR the value of the network is outrageously high.
It is not clear to me that it is ever in the best interests of the company to communicate clearly with holders.
Founders and representatives of companies appear to me more like politicians or religious leaders invoking holders to “trust the process” or “believe” or “just wait until you see…” or “something something community”.
I am bored of these types of projects with this communication.
I will be focusing more on collecting art, my own writing, DeFi, and the interesting unclear legal predicaments in this space.
2. This Week in NFT World
Moonbirds CC0 announcement - Kevin Rose, CEO of Proof, made the 10,000 piece Moonbirds NFT collection CC0. This waives the commercial rights of the holders and turned the collection over to the public domain, where anyone is now free to build on top of the art. The Moonbirds floor price was trading at approximately $25,000 - $30,000 and after an initial sell-off has recovered to that approximate level.
Magic Eden incorporates NFTs on Ethereum - Magic Eden, the main marketplace for NFTs on Solana, has incorporated NFTs on Ethereum. This means you can buy Solana NFTs with ETH, and Ethereum NFTs with SOL. OpenSea has significant marketshare as a marketplace, so this could be seen as a threat to that position.
Instagram integrates NFTS - Instagram has integrated NFTs, and enlisted the help of artist and poet in the web3 space, Amber Vittoria, to onboard new artists and creators to display their NFTs on the platform.
Lamborghini enters - Lamborghini are giving fans an opportunity to collect a series of NFTs over a number of months to obtain rare digital collectibles, wallpapers, digital sketches, and irl VIP tours.
We spoke about all of this and more in this week’s episode #13 of NFT World.
3. New Interviews
I didn’t have any chats this week but I am super happy to announce three exceptionally interesting people for interviews in the next two weeks.
On Wednesday this week I will speak with Gabagool - he is the founder of Information Token (essentially a decentralized venture studio), the Writing Token (a project to explore writing and NFTs) and involved in Velodrome (a trading and liquidity marketplace on the Ethereum Layer 2, Optimism). He and I have been going back and forth for some time chatting about various interesting aspects of the space - so I’m delighted to be get into more detail with him.
And on Wednesday the week after I will speak with VJ and Safa of Tallylabs, the creators of Jenkins The Valet and Azurbala. These projects are some of the most well supported / anticipated in the space - and my good friends SpaceWalk and FilmBook never stop talking about them as an exemplar of how to run and deliver a project leveraging IP in this space - so I had to ask them on to the show to chat.
For people who are less familiar with these chats - they are designed to get into the minds of successful founders in this space and help along any aspiring creators/artists/founders on their own journey.
4. Thought of the Week
As the Merge approaches - the moment where Ethereum moves from a Proof of Work to Proof of Stake network - there are rumours of a fork coming and the “creation” of new crypto: ETH POW.
A fork of a blockchain is essentially when the rules of the blockchain are changed, the blockchain splits into two: a chain which is governed by the new rules and nodes which have updated their software; and a chain which is not governed by the new rules and is run by the nodes which have not updated their software.
Why is this relevant? Because it appears that if Ethereum is forked, if you have 10 ETH, you will then also have 10 ETH POW.
The question is: will your 10 ETH POW be worth anything?
Hasu thinks not for these main reasons in summary:
stablecoins will almost certainly not be redeemable on ETH POW
it is only miners who want ETH POW (because they are the ones losing out financially by the move to POS); everyone else is happy with the move
the talking up of ETH POW is a “retail trap” - designed to get people to buy into it so that others can sell their own ETH POW at a higher price.
A very intriguing sub-plot to the merge and something to think about!
5. Meme of the Week
Introducing the most provably successful model on which you can structure your new NFT project. Shoutout @MinisterOfNFTs
Have a great week,
B
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Disclaimer: The content covered in this newsletter is not to be considered as investment advice. It is for informational and educational purposes only.
I hold some of the NFTs mentioned in these newsletters.
lovely papers BCheq! The merge is certainly something I've not paid enough attention to.
Interesting insights, thank you for sharing